Sephora layoffs: Cosmetics Retailer Giant Plans To Fire About 3% Workforce In China

Sephora Layoffs: This came after Sephora appointed former Nike Asia e-commerce chief as its new Greater China head to revive its fortunes on the mainland as the brand has been struggling to expand

Sephora Layoffs: Cosmetics retailer Sephora is reportedly planning to lay off 3 per cent of its employees in China as the LVMH-owned brand seeks to revitalise its struggling operations in the world's second-largest economy, reported Bloomberg, citing familiar sources.

Sephora China has terminated office and store staff and encouraged others to resign, affecting an estimated 10 per cent of its over 4,000 employees in the country, according to sources in the report. Additionally, some senior executives, including the heads of retail and e-commerce, have also left the company.

However, a spokesperson clarified to the publication that the head office positions affected by the streamlining account for less than 3 per cent of Sephora China’s workforce of over 4,000. The spokesperson declined to comment on the specifics of store staff reductions, stating that the company does not address market speculations.

“In response to the challenging market environment and to ensure our future growth in China, Sephora China is currently streamlining our organisational structure in our head office to ensure we have the right capabilities for long-term sustainable growth,” a company spokesperson told the publication.

The shakeup came after Sephora appointed former Nike Asia e-commerce chief Ding Xia as its new Greater China head to revive its fortunes on the mainland as the brand has been struggling to expand in China.

Sephora’s presence in China represents a key foothold for one of LVMH’s largest brands, particularly as the retailer has been scaling back its operations elsewhere in the region, closing its Taiwan and South Korea locations over the past year. Despite its strong performance in the US, Europe, and the Middle East—where it was LVMH’s second-largest revenue contributor after Louis Vuitton in 2022—the brand has struggled to achieve similar success in China.

The brand suffered about 330 million yuan ($46 million) in combined losses in 2022 and 2023, according to annual reports from skincare manufacturer Shanghai Jahwa United Co. Ltd., which holds 19 per cent of its mainland business.