Marimekko Corporation, Press release, 13 August 2020 at 7:50 a.m.
Due to the coronavirus pandemic, the global fashion and specialty retail sector is facing the worst crisis in decades. The pandemic has expedited the transformation of consumers’ purchasing behavior and intensified structural changes in the sector, such as digitalization. It has accelerated the shift to digital sales channels among customers — including new customer groups — and this will also influence Marimekko’s distribution channel choices in the future. At the same time, the coronavirus crisis has taken uncertainty over the global economy to a completely new level, and consumers’ increased price sensitivity as a result of recession and growth in surplus inventories due to the pandemic create pressure for profitability for the fashion sector.
Marimekko’s operating environment is undergoing a great transformation. Due to the coronavirus pandemic, the company has already been adjusting its retail operations since spring. To strengthen its long-term competitiveness in the new environment, Marimekko has now decided to initiate consultative negotiations with its personnel in order to reorganize and streamline its operations in Finland based on both production-related and financial reasons. The company has also decided to initiate corresponding processes in its organizations in Scandinavia, North America and Australia.
"To strengthen our future competitiveness, we must make sure that our organization structure, competencies, job contents and working methods respond in the best possible way to the dramatic transformation in consumer behavior, driven by digitization and other external dynamics intensified with the pandemic. Our strategy has for some time already been leaning on this direction, but now the ongoing changes put increasing pressure on our operations as well," says Tiina Alahuhta-Kasko, President and CEO of Marimekko.
"I find it extremely regrettable that, in order to reorganize and streamline our operations, we need to initiate consultative negotiations in Finland as well as corresponding processes in our above-mentioned international organizations. With these unfortunate but necessary measures, we aim to secure the financial position of our company in the long term," Alahuhta-Kasko continues.
The consultative negotiations to be initiated will include all Marimekko operations in Finland, with the exception of the retail store staff and the production personnel at the printing factory in Helsinki. The corresponding processes in Scandinavia, North America and Australia will apply to all operations except the personnel in retail stores. Through the reorganization and streamlining of cost structure, the company seeks to achieve annual savings in costs estimated at around EUR 1.5 million in total.