The Body Shop is to cut 300 jobs at its head office while almost half of its 198 stores in the UK could close with the loss of hundreds more jobs as the business battles for survival.
Administrators told staff on Tuesday that seven stores would close immediately, with more set to follow, while numbers at its offices in London and Littlehampton in West Sussex were being cut by 40% to 400. It is not clear if jobs at the group’s warehouse, also in Littlehampton, will be affected.
The retailer, which employs more than 2,200 people in the UK, called in administrators last week, less than two months after being taken over by the restructuring specialist Aurelius. It is understood The Body Shop’s entire team focused on activism – a key part of the ethical group’s identity – has been ousted.
The seven stores that will shut on Tuesday are: Surrey Quays (London), Oxford Street near Bond Street (London), Canary Wharf (London), Cheapside (London), Nuneaton (Warwickshire), Ashford Town Centre (Kent) and Bristol Queens Road.
The joint administrators Tony Wright, Geoff Rowley and Alastair Massey from FRP said: “After years of unprofitability and following a full evaluation of The Body Shop’s UK business, the joint administrators have concluded that the current store portfolio mix is no longer viable. As an immediate step, seven stores will close today, with additional closures to follow. It is expected that at the conclusion of the restructuring, more than half of The Body Shop’s 198 UK stores will remain open.
“A reduced store footprint will coincide with a renewed focus on the brand’s products, online sales channels and wholesale strategies, bringing the brand in line with industry peers and supporting a return to financial stability.”
In total, 1,600 people work in the retailer’s stores, so almost 800 jobs could go if the group closes half the estate.
The administrators said the head office job cuts were part of creating “a forward-looking strategy and more nimble, financially viable model” and that swift action would “help re-energise The Body Shop’s iconic brand”. They added that relationships with key franchise and wholesale partners in Asia, the Middle East and Europe would be “a cornerstone of future success”.
Staff said they would have to apply to the government-backed Redundancy Payments Service for their payoffs, with some having spent served decades at the ethical business.
“It’s a shocking way to treat people,” one insider said.
It is understood that most departments have been hit by at least some job cuts, including IT, marketing, sustainability and those working on the European websites, as well as the activism team.
Aurelius is understood to be the main creditor, with secured debt that will ensure it gets paid by administrators before most other creditors. It is expected to take back the chain, but only after many shops have closed and jobs been cut.
The Body Shop was bought by Aurelius for an initial payment of £117m in a deal agreed in November and finalised in early January.
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The future of the group’s Irish, mainland European and Japanese divisions also hangs in the balance after being sold to a group called Alma24, whose main director has close links to Aurelius. The German arm of The Body Shop, which has about 60 stores, was put into insolvency last week and workers in Belgium, where there are about 16 stores, have been told it is also heading for insolvency.
The Body Shop’s fair trade suppliers who work with local communities of growers and producers from the Amazon to Africa say they have been left with more than $1m (£790,000) worth of beauty ingredients that may now never be ordered or paid for by the beauty chain.
The Body Shop has passed through three owners since it was sold by its founder, Anita Roddick, shortly before her death in 2007.
Roddick, who set up the business in Brighton in 1976, campaigned against animal testing of cosmetics and promoted natural products sourced ethically in a way that would support small producers around the world.
She shocked fans of the brand by selling up to L’Oréal, the cosmetics multinational that owns Maybelline and Garnier, for £652m.
The brand was then sold on to the Brazilian natural cosmetics group Natura, which already owned the Australian Aesop beauty brand, for €1bn in 2017. After Natura built up debts in buying the home-selling cosmetics group Avon, it quickly sold off Aesop and then The Body Shop.
