Bon-Ton Layoffs Job Cut: fires 1200 employees: Finance Trading Times

Bon-Ton Layoffs Job Cut: fires 1200 employees

The NASDAQ listed retail giant Bon-Ton based in Boston has decided to go for layoffs. The company is in the business of retail sales and marketing. Now company Bon-Ton has deiced to go for a big Bon-Ton Lay off or Job Cut. The economic crisis is hitting all sectors. It is learnt that these layoffs are being done because of the declining sales and to save costs. Bon-Ton Layoffs

How many employees will be fired by Bon-Ton layoffs?
Around 1,150 employees will be asked to leave their jobs at Bon-Ton. It will also suspend its 401(k) plan to make savings.

How many employees does Bon-Ton have?
As of March 28, 2008, Bon-Ton had approximately 32,700 full-time and part-time associates. 700 employees are in York, PA and 1900 in the Milwaukee area.

Which department of employees will be affected by the Bon-Ton Layoffs?
Most of the job cuts will be in the manufacturing department.

How much savings can be made by outsourcing and Bon-Ton Layoffs?
Around 70 million USD annual savings will be made by the job cuts.

Any compensation or severance package for the affected employees of Bon-Ton?
The employees who are losing their jobs will receive career transition benefits, including severance payment

WHat are the primary reasons of Bon-Ton Layoffs
The worsening global economy means that there is a decline in sales and hence that is the reason that company is deciding to go for manufacturing job cuts mainly.

WHat actions are being taken by Bon-Ton to come out of the economic crisis?
Actions to be taken in fiscal 2009, which starts Feb. 1, include:
-Reducing corporate and store personnel by approximately 1,150 positions;
-Reducing other non-employee-based costs;
-Eliminating 2008 bonuses for senior executives;
-Eliminating 2009 merit-based wage increases across the entire company;
-Suspending employer contributions to the company’s 401(k) plan;
-Reducing capital spending to $40 million, and adjust inventory levels in response to sales trend.

Any other news about Bon-Ton?
As per Triangle BizJounral, "We are taking necessary actions to reduce costs in response to additional pressure on the retail industry brought on by significant deterioration in both the financial markets and macroeconomic environment," said Bud Bergren, Bon-Ton’s Milwaukee-based president and CEO. "We believe the reduction in force and other initiatives we have outlined will improve our cost structure and will better position the company for the current difficult economy and for the longer term."

The employees who are losing their jobs will receive career transition benefits, including severance payments, Bergren said.

The retailer estimates impact of the actions will be an increase in operating income of $70 million annually.

The costs associated with the reductions, including severance payments, are estimated at $3 million.

Bon-Ton said it also is reviewing the value of its intangible, long-lived and tax assets. Bon-Ton executives expect the company will record a "material non-cash charge" to reduce the reported value of the assets.

"We have a strong franchise with eight regional nameplates, a loyal customer and associate base and a merchandise mix that differentiates us from our competitors," Bergren said. "In addition, we have strong vendor relationships and an experienced and talented management team. We believe the implementation of our cost saving plan will further strengthen the company for the short term and position it well for the future."

Bon Ton operates 281 stores, including 12 furniture galleries, under the Bon-Ton, Bergner’s, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger’s and Younkers nameplates. It also operates Parisian stores in the Detroit area.
Let's hope that alternative jobs are available to the affected employees of Bon-Ton Layoffs Job Cut.
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