Sephora China Cuts Jobs

Sephora is cutting jobs in China, the LVMH Moët Hennessy Louis Vuitton-owned company confirmed Wednesday.

The beauty retailer, which has been in China since 2005, is trimming its workforce by 3 percent, the equivalent of around 120 jobs amid a slowdown in China.

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“In response to the challenging market environment and to ensure our future growth in China, Sephora China is currently streamlining our organizational structure in our head office to ensure we have the right capabilities for long-term sustainable growth,” Sephora China said in a statement.

Speaking at a WWD Beauty Inc event in May, Alia Gogi, president, Asia Sephora, said that while the retailer’s sales were up in China last year, the country’s recovery is taking longer than expected.

“What it is forcing all brands to do, including Sephora, is to be very laser-focused on our strategies,” said Gogi at the time, explaining the retailer is doubling down on its “differentiated portfolio strategy.”

Curation is key to this. Over the past two years, Sephora has staged in China well-received launches for the likes of Anastasia Beverly Hills, Hourglass and Tatcha. The Drunk Elephant and Fenty introductions happened in May. “The Chinese consumer genuinely appreciates localizing,” Gogi said.

Addressing the beauty brand community at large at the conference, she counseled: “Be patient. One of the things about China is when it does come back, you will need to be agile — that becomes even more important — and it will come back very fast.”

Earlier in the week, the Estée Lauder Cos. said it expects further declines in prestige beauty in China next year, while North America is softening as well.

“We are cognizant that overall global prestige beauty growth has tempered in recent months as reflected in the current declines in mainland China and Asia travel retail, particularly Hainan,” said chief financial officer Tracey Travis during an earnings call.

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