The footwear and sports fashion company Munich is negotiating the application of a Workforce Adjustment Plan (ERE) to lay off about 65 workers from its store network in Spain, around 16% of the workforce.
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Sources from the workers’ legal representation have told EFE that the management of the Catalan company cites economic reasons to justify the layoffs, including a drop in revenue in their physical stores.
The company owned by Xavier and David Barneda points out that it is a “painful” decision but motivated by the losses recorded in part of the store network. Before the ERE, they tried to apply other measures, as well as renegotiating the lease conditions.
The consultation period for the layoff plan ends in mid-August
According to its website, Munich currently has more than 40 physical points of sale, including stores – most of them located in shopping centers – and spaces within El Corte Inglés shopping centers in various autonomous communities.
The brand wants to close around fifteen of these stores, in cities such as Barcelona, Madrid, Seville, Málaga, Zaragoza, or San Sebastián, according to the legal representation of those affected. The closure process will be uniform, as there are different contractual situations in the premises where these stores are located. The consultation period for the ERE ends in mid-August.
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The workforce adjustment plan affects the company La Tormenta Perfecta, which encompasses Munich’s store network, and the employees working in them.
In March of this year, it became known that the company was negotiating with banks a refinancing of its debt, which exceeds 20 million euros. The historic Catalan company is going through a delicate moment. Revenues in the last year have not grown as expected.
Market sources then pointed out that there were several loans to be repaid due to the strong bet on opening own stores throughout Spain and diversifying products beyond sports shoes.
In the last fiscal year, closed in March, Munich expected to keep revenues stable, around 70 million euros, compared to 80 million recorded two years ago. Headquartered in Capellades, the workforce reaches 400 people.
