Debenhams is cutting more than 300 jobs at its headquarters as it slims down its back office team in line with a swathe of store closures.
The redundancies in merchandising, buying, design and other administrative functions come after the British department store went into administration last month – the second time in a year.
The retailer, which shut its stores temporarily in March under the government’s high street lockdown, has since said it will permanently close at least 11 of its 142 outlets.
Negotiations with landlords have secured agreement on retaining 120 sites. The future of an additional 11 hangs in the balance including five in shopping centres owned by the property firm Hammerson, which has signed a deal to bring Next beauty halls into the sites, after news of Debenhams’ administration.
Debenhams is seeking to grab some of the Hammerson sites back. The future of four sites in Wales is also under debate after the Welsh government said Debenhams must pay its business rates bill on the properties.
A spokesperson for the retailer said: “Debenhams’ preparations to reopen the vast majority of its stores from 15 June are well under way following the successful conclusion of lease negotiations on 120 stores.
“In the context of a retail industry undergoing profound change, the management team is working on the future shape of the group, with a view to exiting administration as a going concern. With a leaner and more flexible operating model, Debenhams will have the ability to adapt to what are likely to be fundamental shifts in the future trading environment.”
The majority of staff have been furloughed, although the website has continued to trade.
Like many other retailers, the department store chain, which employed more than 20,000 people before its latest administration, has been badly affected by the coronavirus lockdown.
However, even before that, Debenhams was struggling with a £600m debt pile. The group’s poor financial situation resulted in administration in April 2019, which wiped out its shareholders and transferred ownership to a group of financial investors, including the US hedge funds Silver Point and GoldenTree.