France’s top department store chain, Clothes and Accessories, is selling off its assets
PARIS—France’s top clothing and accessories chain, Paris-based ClothesandAls, is shutting down.
ClothesANDals announced on Wednesday that it would shut down and lay off 8,000 employees.
The company said in a statement that it has reached the decision to “renew operations.”
The company will have to lay off around 8,600 employees, and will continue to process and deliver orders through the end of the year.
Closes June 30.
Paris-Based Clothes ANDals had a market value of $3.8 billion as of March 31, according to the company’s annual report.
Its stock closed at 3.7 euros, or $4.50.
Closures and layoffs are often a sign of the global recession, which is already hitting European retailers.
Closings in France are a sign that the country’s economy is slowing, as well as the threat of a sharp downturn in consumer spending, according of France’s National Statistical Office.
In addition, the government has taken a number of measures in recent weeks to tighten its financial restrictions on banks and companies, such as cutting the capital gains tax on assets held by corporations and limiting the ability of companies to issue more than a certain number of shares.
The government also announced plans to cut the minimum wage in 2017 from 7.2 euros to 6.3 euros, as it seeks to attract more foreign investment.
Read more about Clothesands collapse: Paris- based ClothesAndAls had about 10,000 stores, including some smaller department stores and department stores of more than 20,000 square meters, according the company.
Its stores are scattered across France, and some were not in use.
Its flagship store, on the Champs-Elysees, was closed in 2016 and was replaced with a smaller location.
Paris-based clothing chain Clothes &Co. said on Wednesday it had laid off more than 1,000 workers and was restructuring operations to improve its efficiency.
The chain said in March it would lay off 6,000 staff and layoff 7,000 people by June 30, which would be the last day of the company, the chain said.
The move comes amid a global economic slowdown, as the global economy faces the worst recession since the Great Depression.
The sector is facing increasing competition from online shopping services, as more consumers opt to shop in-person rather than via the web.
Closing the stores could be a boon to consumers, who would still have access to stores where they can shop, and it would help cut the cost of clothing for those who still live in the city.
ClothesANDas has been under pressure in recent months as the financial markets tightened, and the country has struggled to attract foreign investment as its banks have struggled to provide sufficient collateral to lend to businesses.
In March, the European Commission announced a plan to increase the minimum working age to 65 in order to help the sector meet the needs of an aging population.
Ahead of the planned layoffs, Closes May 6, Closets reported a loss of €3.4 billion ($3.86 billion), according to a company statement.