Edgars could close 1,300 stores and cut 40,000 jobs

Edgars is at risk of going under and closing many stores.

This is according to a report in the Sunday Times, which said Edcon – Edgars’ owners – is in massive financial trouble.

The report states that Edcon has asked shopping mall landlords for help and for reduced rentals in a bid to save the company.

In return for a “two-year 41% rent holiday”, Edcon will give landlords 5% in the business.

If this does not work, Edcon faces liquidation, the closure of 1,300 stores, and the cutting of 40,000 jobs. This could result in the country’s biggest ever single job loss, if indirect jobs are also taken into account.

The report added that Edcon is also seeking R2-billion in emergency funding from its owners and the Public Investment Corporation.

The path which led to the current problems are a result of poor management, said the report. It added that Edcon hit hard times after Bain delisted it from the JSE in 2007 – taking a R25-billion to take it private.

While Edgars is know for clothing and accessories, it has branched out to other sectors in recent years.

In 2015, Blue Label Telecoms launched a series of commercial stores called Edgars Connect.

The stores were run in partnership with Edgars and sold SIM cards, handsets and tablets, and value added services.

At the time, 22 stores were open, and the group aimed to open 400 in total.

Now read: New products and fibre partnerships for MWEB in 2019

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Edgars could close 1,300 stores and cut 40,000 jobs