Bloomberg
Edcon Holdings, South Africa’s largest clothing retailer, plans to cut jobs at its 13 000-employee Edgars chain starting in May as it aims to reduce costs at the flagship division.
“The chain is still below its productivity and efficiency targets,” spokeswoman Debbie Millar said yesterday. “Job losses are regrettable.”
Edcon, controlled by US private equity firm Bain Capital Partners, has been revamping some of its 190 Edgars stores in an effort to improve market share. The chain has started selling international brands as concessions in the shops.
The company had started a consultation process with affected employees and would provide exact numbers of job losses later in the process, Millar said. Not all stores would lose staff and cuts would include managers, she said.
Second-quarter sales rose and losses narrowed as trading at discount chains such as Jet improved and new brands were introduced, unlisted Edcon said in November last year. Retail sales advanced 5.9 percent to R6 billion in the three months to September 28 as cash sales grew 17.4 percent.
Bain bought Edcon in 2007 for R25bn in an effort to tap rising consumer spending in the country. South African retail sales growth slowed to 3.5 percent in December from a revised 4.4 percent the month before. Edcon will report third-quarter earnings tomorrow.