Guess aims to slash about 9 per cent of its global retail network by closing down 100 stores worldwide. Most of these closures will be in North America and China over the next 18 months, as many of the retailer’s leases in these regions are set to expire soon. During the closure, the company lowered its costs by furloughing all the store staff and half the corporate workforce while at the Los Angeles headquarters laid off 150 employees. Its management also reduced some wages by as much as 70 per cent and canceled all uncritical capital expenditure. In April, the apparel store stopped rent payments, and is now negotiating with landlords. Over the next three years about 70 percent of the company’s leases are expected to expire globally.
In the US and Canada, one-third of Guess stores will have their leases coming to an end soon and 15 percent of their European stores will be up for renewal in the coming year.