// Estée Lauder cuts 2000 jobs as it reduces store estate
// It plans to save over £300m a year
// The beauty brand has concessions within department stores such as John Lewis, House of Fraser and Debenhams
Estée Lauder is axing 2000 jobs worldwide as it plans to close stores and department store beauty counters to save as much as $400 million (£302 million) a year.
The US cosmetics giant, which owns Mac, Joe Malone and Clinique, said it will shutter between 10 per cent and 15 per cent of its standalone store estate.
Meanwhile, concessions within department stores such as John Lewis, House of Fraser and Debenhams will also be reduced.
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The job cuts will affect around three per cent of Estée Lauder’s workforce.
The company’s net profits more than halved to $680 million (£513.4 million) in the 12 months to the end of June, while sales during its fourth quarter dropped by 32 per cent.
Sales of its make-up brands dropped 18 per cent across the year.
Despite online sales rising, it was not enough to offset the company’s losses.
Estée Lauder cut down at least $800 million (£604 million) in costs during its fiscal year by reducing advertising and travel spend as well as pausing its recruitment process.
However, it warned that profits in the first quarter of its new financial year would come in below analysts’ expectations.
Estée Lauder is not the only business on the high street to announce job cuts, after major retailers recently revealed thousands of redundancies as a result of the Covid-19 pandemic.
Frasers Group said earlier this week that it plans to invest “in excess of £100 million” on its digital elevation strategy and warned of store closures as it continues to shift its focus towards online.
Marks & Spencer also confirmed it will axe a total of 7000 jobs over the next three months as part of its efforts to transform the business amid the crisis.
LK Bennett is also seeking to restructure its store teams which will lead to 19 redundancies.