After the traditional Esprit brand filed for bankruptcy, there was hope for a new beginning. However, an ex-supervisory board member is now dampening the prospect of continuing the business.
The branches of the fashion brand Esprit have been an integral part of German city centers for decades. After there have been numerous changes at the top of the international clothing group in recent years, the employees now seem to be facing an uncertain future. Esprit had to file for insolvency for its European business on Wednesday (t-online reported).
Business operations will continue until further notice. The approximately 1,500 affected employees in Germany have been informed, as the company said on Wednesday. But are their jobs secure?
According to the fashion group, the bankruptcy will be accompanied by a new beginning in business. The company said the aim is to make the European business, which is largely managed from Germany, fit for the future. Discussions have already been held with an interested financial investor. The negotiations regarding the acquisition of the trademark rights for Europe are therefore at an advanced stage.
However, a former board member of the group does not see the future prospects as rosy. Wolfgang Schlangmann, who was on the board of directors and supervisory board at Esprit between 2021 and 2024, no longer believes in maintaining the branches. He no longer sees any prospects for the insolvent fashion company.
According to Schlangmann, Esprit’s core business, its 57 own stores in Germany, has been “highly loss-making for years,” the experienced manager told the “Rheinische Post”. “In my opinion, every Esprit branch in Germany will have to close,” said the former board member.
Will the new investor remain loyal to the branch business?
Schlangmann joined the clothing provider, which was founded in San Francisco but is now based in Hong Kong, in 2020. In March 2024, he resigned from his position as Executive Director at Esprit and left the company.
According to the announcement, the previous managing director Man Yi Yip will be leaving the company. The lawyers Christian Gerloff and Christian Stoffler are to take over the management and restructure the fashion group. Esprit has been suffering from falling sales for “some time now,” said Gerloff. Significant parts of the European business are affected by the insolvency. The Esprit subsidiaries in Belgium and Switzerland had already filed for bankruptcy in March 2024.
As several Esprit employees reported to the “Rheinische Post”, the two restructuring experts announced at a works meeting on Wednesday that the British investment company Alteri Investors would soon take over part of the Esprit business. The negotiations were in the “final stage,” it was said at the staff meeting.
Esprit: another inglorious chapter
However, ex-Esprit board member Schlangmann believes that Alteri will not take over the loss-making branch business, but only the “only profitable part of the company”: the rights to sell the brand’s goods within other retailers such as Galeria or Peek & Cloppenburg.
It would be another inglorious chapter in the history of the once popular fashion label. The company had already filed for bankruptcy in 2020 and had to close around half of all 100 branches of the fashion chain in Germany. The majority of the 6,000 employees at the time also had to be separated.
Then Hong Kong billionaire Karen Lo joined Esprit and promised to take the restructuring case back to the top of the world. But even back then, the trade journal “Manager Magazin” wrote about a “risky plan” with “questionable means”. Four years later, it appears those fears have come true.