Galeries Lafayette is entering a new phase in the management of its store network in France with the launch of a project to grant franchises for seven locations to Societe des Grands Magasins, a family-owned company specialising in high street retail space. This project, which would involve the sale of premises and operations, relates to the stores in Angers, Dijon, Grenoble, Le Mans, Limoges, Orleans and Reims.
At the same time, Hermione People & Brands (FIB group retail division), already an important franchisee of Galeries Lafayette, would take over the stores in Pau, Rosny and Tours, whereas the business assets of the Avignon store would be entrusted to Philippe Sempere and Nicolas Chambon, who already operate the franchise for the Beziers store.
Three years after arranging franchises for 22 Galeries Lafayette stores to Hermione People & Brands, this new phase aims to reinvigorate these high-quality commercial and property assets, all ideally located in the central areas of mid-sized French provincial cities, by entrusting them to partners specialising in retail assets with strong local roots, who are therefore well suited to adapt each of the stores involved to customer expectations in their regions.
Based on the experience acquired over the last years, Galeries Lafayette has built up specific expertise in this more agile operating model, which has proven its merit for the retail group and will allow it to maintain its strong brand presence throughout France while refocusing its investment priorities and efforts on its main French flagship stores, the ramp-up of its omnichannel strategy and its targeted expansion outside France. At the completion of this scheme, which is expected by early 2022, Galeries Lafayette will be operating 19 stores directly and 38 as franchises. This project would have no impact on employment. As is the case for all other stores in the network, the newly franchised stores will continue to have access to all Galeries Lafayette fashion offerings and will be included in its programme of marketing campaigns and in-store events.
Commenting on this announcement, Nicolas Houze, Chief Executive Officer of Galeries Lafayette and BHV Marais, commented: “The crisis we have just experienced offers an opportunity to accelerate our transformation. We are convinced more than ever that the department store model is still relevant, and we wish to move forward with it using approaches taking advantage of stronger local ties and improved specialisation. The new phase we are entering today with this project to franchise 11 of our stores in France is in keeping with this perspective and is unquestionably a win-win solution, for us, for our franchisee partners and for the stores concerned. We will continue to raise the profile of the Galeries Lafayette brand and its fashion expertise as a key high street fixture in mid-sized French cities, while giving fresh impetus to these stores thanks to the involvement of very active partners. With 19 stores operated directly and 38 as franchises, we would reach a new balance in the management of our store network in France. As a responsible employer, we will remain fully committed to supporting our employees over the course of this project, in close collaboration with employee and union representatives.”
