As sales prestige beauty sales continue to slow in several European countries, Marionnaud has initiated a drastic restructuring of its network. The retailer, which counted more than 1,100 stores in 11 countries in Europe, is closing several points of sale to focus on the most profitable stores.
Out of the Polish market
Marionnaud is therefore pulling out entirely from the Polish market with the closure of its 21 perfume shops in the country. Watson says the group wants to “focus its activities on other Central European markets, including the Czech Republic, Slovakia, Hungary and Romania.”
Closures in Spain and Portugal
In the Iberian Peninsula, the group is dramatically reducing the size of its retail network. Following negotiations with the employee representatives, Marionnaud Iberica has announced its intention to focus its business on 43% of its network. As a consequence, a total of 73 stores - 69 in Spain and 4 in Portugal - out of 128 will be closed.
At the end of the operation, Marionnaud will be present in Spain and Portugal through 55 stores and will employ 330 staff, compared to 660 previously. The crisis, which has hit the two countries since 2008, has led to a significant contraction of the selective beauty market and recovery is yet to come (sales declined by -7% in 2012 and by -2.1 % in 2013 according to The NPD Group).
New management
Conjointly to this restructuring, the group’s top management has entered a transitional period.
In France, where Marionnaud has accelerated the renovation of its 531 stores and reopened its flagship store on the Champs-Elysées, Eileen Yeo has succeeded William G. Koeberlé as the new CEO. Mrs Yo was previously co-CEO Marionnaud France since her arrival in the company in 2013.
After more than 8.5 years in the Group, William Koeberlé will leave it definitively this summer to pursue “personal projects”. During this transition period, he will monitor public affaires issues for the company, according to AS Watson.
Owner carries on investments
The Marionnaud group was acquired in 2005 by the world’s leading retailer of health, beauty, fragrance and cosmetic products, AS Watson Group, a subsidiary of the Hutchison Whampoa-Group. At a press conference at the end of February in Hong Kong, Hutchison Whampoa’s Group Managing Director Canning Fok said there is no plan to sell this division in which the group will continue to invest. However, Hutchison Whampoa has indicated that the Marionnaud business would be excluded from the future IPO of approximately 25% of AS Watson & Co shares.
