Tom Tailor

A Tailor-Made Recovery Plan

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The clothes haven't been flying off the shelves at Tom Tailor.
  • Why it matters

    Why it matters

    Tom Tailor is stuck in the troubled middle-market of fashion retail and has been unable to differentiate itself from rivals.

  • Facts

    Facts

    • Tom Tailor was founded in Hamburg in 1962 and now has 1,500 outlets across several Western European countries.
    • The company had revenues of almost €1 billion ($1 billion) in 2014 but has overstretched itself.
    • It has announced it will close up to 100 of its stores this year, ax the Bonita brand for older customers and cut 100 jobs.
  • Audio

    Audio

  • Pdf

With its share price down by more than half and its rapid growth halted, the Tom Tailor fashion chain didn’t present a pretty picture to its investors last year.

Dieter Holzer, the company’s chief executive for nine years, now hopes to give them a brighter one with his new plans for tight austerity measures, to be presented together with the company’s 2015 later on Tuesday.

After first mentioning plans to save €10 million, or $11 million, he recently said he intended to reduce costs in 2017 by as much as €20 million. To do this, he planned to cut around 100 administration jobs and close between 80 and 100 of the chain’s 1,500 stores. The Bonita brand, aimed at older customers, would also be axed.

“We are leaving no stone unturned, and are investigating in every store,” Mr. Holzer said. At the same time, he intends to open only 30 new stores – after 132 openings and 41 closures last year.

Mr. Holzer has squandered a lot of trust. Last autumn, he had to revise profit targets because costs were too high. And the Bonita chain, which was acquired in 2012, has not met its high expectations.

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