German beauty retailer Douglas is set to shut more than 20% of its bricks-and-mortar destinations in Europe.
Around 500 are set to close by autumn 2022, the majority of which are in Southern Europe. The figure also includes 60 of its 430 German stores.
Some 2,500 jobs will be affected by the decision, however, this number will depend on negotiations with unions, a spokesperson told Cosmetics Business.
“We will try to offer employees affected jobs in other shops but as many of our shops are closed due to lockdowns this is not very likely,” they added.
The group said the decision was part of its #ForwardBeauty movement as the retailer invested in its e-commerce platform, which it kickstarted in 2018.
However, months of lockdown due to the Covid-19 outbreak has accelerated online shopping and with it Douglas’ efforts to push e-commerce.
For 2020, Douglas reported sales of €1bn via its e-commerce platform, also triggering the retailer’s decision to move more of its operations online.
Record sales in e-commerce were also reported for the financial year 2019/2020 with a 40.6% increase to €822m.
“We have a deep understanding of our customers’ needs, understand their purchasing behaviour and we will continue to drive the transformation towards e-commerce initiated in 2018,” said Tina Müller, Douglas’ CEO.
In spite of its online success, the retailer reported a decline in group sales of 6.4% and a 16.7% reduction in operating profit.
It also emerged last year that the group could begin a financial restructure in 2021 as it reels from the effects of the pandemic.
This could see the retailer refinance or strike a deal to amend its maturities, or choose to swap its debt for equity.
As of June 2020, Douglas’ net debt stood at €2.1bn.