Philip Green's British fashion group Arcadia plans to cut 500 of its head office workforce of 2,500, it said on Wednesday, blaming the coronavirus crisis for the restructuring.
"Due to the impact of Covid-19 on our business including the closure for over three months of all our stores and head offices, we have today informed staff of the need to restructure our head offices," the Topshop-to-Dorothy Perkins group said.
It said the cuts were essential to ensure it operated as efficiently as possible in "very challenging times".
Arcadia has been hit hard by the coronovirus lockdown, furloughing 14,500 of its 16,000 employees during lockdown.
And the company was struggling long before the pandemic reached the UK.
The fashion group was on the brink of collapse last June, after creditors backed a rescue plan that involved the closure of 50 stores, 1,000 job losses and rent cuts of up to 70%.
The majority of branches hit were Topshop, Dorothy Perkins, Burton and Miss Selfridge stores.
Experts are now calling for new measures from the Chancellor to support the stores that have been closed.
Milan Pandya, a partner at tax firm Blick Rothenberg, said: “It is vital that the Chancellor announces a clear and comprehensive plan to support non-essential retailers. The sector needs continued short-term support but also longer-term assistance whilst it transforms.”
“For many retailers a real cash flow crisis has arrived. With stores re-opening and Autumn/Winter season purchase orders having to be made, many retailers are having to commit to spending cash against a backdrop of real uncertainty – will customer demand bounce back or will there be further lockdowns such as in Leicester or country-wide.
"The pressure on working capital is immense and this is before many businesses consider the further cash needed to support investment to pivot the business to strengthen long term survival prospects, most commonly developing the right e-commerce platform.
"The fashion industry alone employs in excess of 900,000 people, many being in retail stores. If the recent spate of closures and redundancies continue the government has a real long-term problem of unemployment as many jobs will be relatively low-skilled.”
