Versace Cuts 350 Jobs

Versace has been a brand in transition for a while now but new CEO Gian Giacomo Ferraris has been shaking things up lately. His latest move is an announcement that the Italian fashion house will lose 350 jobs worldwide by the middle of next year as part of a cost-cutting initiative that also includes a thorough evaluation of Versace's store network. The brand recently decided to close stores in Japan, formerly one of the biggest luxury goods markets.

The Wall Street Journal reports that the company is expected to post a pre-tax loss of €30 million ($44.4 million) on revenue of €273 million. This is a sharp contrast to 2008 when Versace posted a net profit of €9 million on sales of €336 million. Part of the decline is due to a fall in sales in the company's wholesale business and the financial collapse of IT Holding SpA, which produced clothing for Versace under brand licensing agreements. Versace re-launched the secondary line Versus at Milan Fashion week earlier this month.The brand will move forward with new runway designs and will instead focus its fat trimming in the areas of production, distribution and logistics. That's good news for Donatella Versace, the brand's designer who also holds a 20 percent stake in the company. Her daughter Allegra Versace Beck has a 50 percent stake bequeathed to her by her late uncle Gianni Versace and her other uncle Santo Versace has the remaining 30 percent of the company. Ferraris came aboard this spring after Donatella Versace's repeated battles with Giancarlo Di Risio.