Estée Lauder has announced details of its restructuring costs and charges as part of the Leading Beauty Forward initiative, which is said to total between $600 to $700 million.
The Leading Beauty Forward programme is a three year plan that was announced this month, and is said to free up resources in a bid to give the company scope to invest in training, development and organization models.
In a filing with the U.S. Securities and Exchange Commission, Estée Lauder stated that $89.7 million of the charges will be put down to optimizing the supply chain, support structures and removing underperforming operations. Meanwhile around $48.7 million will be spent on employee-related restructuring costs.
While the cost-cutting exercise is said to put 900 to 1200 jobs at risk, it is said to create $200 million to $300 million in annual net benefits.
According to WWD, Estée Lauder Chief Executive Officer Fabrizio Freda said, “The end result of all this…is that we will develop more funds to invest in our growth … these extra funds will be invested in more advertising, will be invested in more freestanding stores and will be invested in better in-store activities across department store and specialty.”