why Pimkie is downsizing and wants to close 64 stores

The ready-to-wear sector in France has been shaken for several months by a violent crisis. Tuesday, March 28, the brand specializing in jeans, Kaporal, announces its placement in receivership. In February, the San Marina shoemaker went into liquidation, leaving 650 employees out of business. In September: liquidation of Camaïeu and investments in recovery of Kookaï, Gap and Go Sport.

>> Ready-to-wear: Pimkie announces the closure of 64 stores and the phasing out of 257 positions by 2027

But you don’t have to mix it all up. The crisis often has a good back and does not explain all the routs. There is the obvious impact of the Covid-19 episode. The sale of textiles suffered from its non-essential nature during the confinements which deprived the shops of their traditional customers. Habits took hold and last year sales remained 10% below their pre-crisis level in 2019.

Alongside this, there are brands that have not been able to take the turn of the Internet or online sales. Inflation has reinforced concerns about purchasing power, favoring the rise of second-hand trade and then there is business management. Camaïeux, Gap, Go Sport and the Galeries Lafayette in the region have they not finally suffered from too great a diversification of investments by their owner, the Bordeaux billionaire Michel Ohayon – in the first hundred fortunes of France – who is also very busy in real estate, luxury hotels and positions abroad?

The Pimkie case

As for Pimkie, the new owner wants to transform the company through a savings plan. Pimkie has been loss-making for several years. Management cites a decline in store traffic and sales in general. The ambition is to revitalize the whole, but for this, it will be necessary to go through a long-term project and a profound reorganization, including the reduction of the number of stores from 300 to 64 and the elimination by 2027 of some 260 positions. out of a total workforce of 1,400.

The brand was bought in February from the Mulliez family (historical owner of Auchan) by Pimkinvest, a consortium led by the groups Lee Cooper France and Amoniss, owner of Kindy. Brands and brands which, after having encountered some setbacks themselves, have recovered and are currently holding their own.

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