Ace & Tate’s loss is growing and could result in layoffs and other cutbacks.
The Dutch eyewear brand posted a loss of 11 million euros in fiscal 2022, according to its annual report, Dutch news outlet Quote reports. In 2021, the company still recorded a loss of 7.7 million euros. However, in 2022 sales increased by EUR 12.5 million to EUR 55.5 million compared to the previous year.
Ace & Tate attributes the fact that the company is slipping deeper and deeper into the red to rising salaries. This is not surprising as the eyewear brand opened more stores and hired 74 additional employees. In addition, the increase in losses is due to the Corona-related shop closure. The temporary staff stayed at home and the government supported the permanent staff. Ace & Tate received 3.8 million euros in support, as reported by Quote.
The red numbers have Ace & Tate considering cost savings. This comes in the form of savings at headquarters, reducing marketing costs and reducing labor costs by laying off employees. The list of possibilities also includes demands for rent reductions and stopping shop openings.
While the bottom line result isn’t positive, it’s in line with expectations as Ace & Tate looks to invest in growth and international expansion. The management therefore adjusts the course of the company and from now on focuses more on profitable growth than on growth rates. This puts the company in a better position to fund its growth, the company said.
This translated and edited post previously appeared on FashionUnited.nl.