Versace Cuts Staff in the US

Versace has cut personnel at its US branch by 5% to concentrate the entire sales division at its Milan headquarters. A drastic 'austerity program' was announced previously by Santo and Donatella Versace, not only with regard to overhead expenses but also the cost of goods sold. The objective is to save 50 million within the next 12 months to make up for the deficit posted in the annual report for 2002, which closed with a net loss of 5.8 million despite capital gains of 25 million from the agreement with Luxottica.

Medusa took drastic steps last month and the some of the Group's top managers, involved in the retail and wholesale sectors, were let go. At the New York offices, fifteen people have already been given the pink slip, including several executives such as Jessica Mitchell, VP in charge of wholesale, sales director Cynthia Barrett, and retail director Keith Scott. According to recent statements by the Versace family, 'The company is not up for sale'.