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Shiseido offers early retirement to 1,500 employees to boost profitability

Shiseido is offering early retirement to around 1,500 of its Japanese employees, as the global beauty giant looks to boost growth and profitability.

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The Tokyo-based skincare firm said the plan will be offered to employees who meet certain age and tenure requirements, representing about 3.7 percent of its employees worldwide. Applications will be open April 17 through May 8. Meanwhile, the estimated financial impact of the cost-saving measure has already been incorporated into the firm’s full-year forecast.

“After Covid and with the Japanese economy starting to recover, there has been an increase in opportunities to examine new career options, while re-considering factors such as working styles and life plans,” the company said.

“Amidst that background, Shiseido Japan will implement significant reforms, which will support those employees exploring alternative opportunities beyond the company.”

The early retirement plan at Shiseido forms part of the firm’s ‘Mirai Shift Nippon 2025’ transformation strategy, with the goal of sustainable growth and improved profitability moving toward 2025. The company also plans to focus on developing new markets and is looking to cut costs by about JPY 25 billion (USD 167 million) over the next two years.

Founded in 1872, the Shiseido portfolio is made up of its namesake Shiseido brand, as well as Nars, Drunk Elephant, Anessa and Elixir. In December, the group announced it had acquired skincare brand Dr. Dennis Gross Skincare.

In its most recent earnings update, Shiseido revealed it had been hit hard by China’s sluggish recovery post-pandemic, reporting a nearly 40 percent slump in 2023 earnings, with operating profits dropping to JPY 28.1bn from JPY 46.5bn.