FNAC Fashion Nightmare

Few chains inspire the kind of attachment that FNAC does. Staffed by salespeople with PHD-equivalent educations in the arts and technology, for the last two decades, the French retailer has been the single most influential store of its kind in Europe. Whether it’s obscure Glasgow wonky LPs, limited edition Pasolini DVDs, or imported American DJ gear, you’ll find it there.

Like many brick and mortar retailers in the EU, FNAC has been badly hit by the growth of Amazon, and the Euro crisis. The subject of fierce labor disputes, (including a highly-publicized kidnapping in Paris,) the chain has begun the painful process of downsizing. The lead photo, of a recent employee demonstration in Turin, and the following translation, of a flyer handed out at the event, testify to the turmoil.

FNAC FASHION NIGHTMARE

A JOB IS A LUXURY

FNAC is a French chain of megastores selling books, CDs, DVDs and technology products. In Italy, it owns eight stores and an online shop, and employs 600 people. FNAC is member of the PPR Group, which owns, among others, the Gucci and Bottega Veneta brands. François-Henri Pinault owns PPR.

On January 13th 2012, FNAC’s head office issued a press release announcing a vast reorganization of the company, outlining savings measures for each country where FNAC is present. The announcement devotes one sentence to the future of FNAC Italy: “In Italy, where [economic] conditions remain unfavorable, FNAC will consider all possible options and will make a decision by the end of the year.” (It’s) just one sentence, but (it is) enough to make the PPR Group’s intentions clear: no more investments in Italy.

Today, eight months after this communication, FNAC Italy employees have not received any information about the company’s future. Repeated requests for clarifications and information have not obtained any results. Eight months have passed, waiting in silence and uncertainty.

In the meantime, the December 31st deadline is approaching – the date by which the decision about the future of 600 FNAC Italy workers will be taken – and the possibility of closure is becoming more and more real.

Extremely concerned about the situation, and surprised by the unacceptable silence of FNAC and PPR Group management, FNAC Italy employees are asking for clear, comprehensive and credible answers about their future.

Here are the statements of PPR Group to the press, while the possibility of FNAC Italy’s closure is becoming more real:

Alexis Babeau: (We’re) sorry if we haven’t undergone any crises, but rich people are always more numerous. François-Henri Pinault’s right-hand man explains why the ambitious target of the PPR group will be reached without difficulty:

I can’t see why this sector shouldn’t continue to grow. The rich all over the world are increasing, and will increase more and more. Therefore the number of people wanting to gratify themselves with exclusive clothes and accessories will always be greater.

We don’t have any money problems. We are able to finance our operations without asking the banks for support.

With 4.9 billion [Euros] in proceeds in 2011, in less than 10 years you should reach 14.4 billion. Are you more busy, or concerned?

I would say optimistic, and thrilled with the challenge. Which is relevant, since the turnover of the luxury market should triple in less than 10 years.

Sales are increasing. Incomes are rising. What about the employees?

In the luxury division of PPR, in 2010 there were 11, 803 people working. In 2011 we increased their number of little less than 15 percent to 13, 542. And we are still hiring.

Quoted in Panorama

11th July 2012

MONSIEUR PIANULT, IF THE CRISIS DOES NOT WORRY YOU, IT WORRIES US. WHAT ARE YOU THINKING OF DOING WITH THE 600 EMPLOYEES OF FNAC ITALY?

Translated from the Italian by Giulia Pace. Photographs courtesy of Joel Schalit