Habitat employees demonstrated on Friday, November 24, in front of the store in the Pont-Neuf district of Paris, which was promised to close “within two weeks, during the Christmas sales period”, panics Ratiba Hamache, central CGT union delegate. The furniture brand, owned since 2020 by Thierry Le Guénic, is facing a “dramatic situation”fault of “payment of its suppliers and service providers since spring 2021”says the union representative.
During a meeting of the social and economic committee on Thursday, November 16, the management of the company, which employs 500 people in France, announced the closure of eight of its twenty-six stores operated in France. In addition to the Pont-Neuf store, whose twenty employees, according to management, will be reclassified in other points of sale in the Ile-de-France region, the list of closures includes the stores in Grenoble, Reims, Toulon, Nice, Albi and Rennes. and Nantes.
“Habitat is impacted by the current decline in store traffic and the drop in purchasing power in a context of downturn in the home equipment market”explains, in a press release, the company, recalling having been “faced, over the last two years, with the energy crisis, rising transport costs and raw materials” and to have “inherited from a difficult past”.
Negative cash flow
In 2020, the Cafom group, franchisee of But and Darty stores, offloaded the Habitat brand, which it had not managed to turn around since its acquisition in 2011. The chain had thirty-six branches, including twenty-seven in France, one in Monaco, five in Spain and three in Switzerland. The distributor then specified that the said Housing division had “generated an annual turnover of 100 million euros for a cash consumption of 13 million during the financial year ended September 30, 2019”.
This transfer was accompanied by “means of implementing a development plan”in order to “return to profitability”, specifies the reference document of the group listed on the stock exchange. Habitat’s cash flow had been replenished to the tune of 15 million euros and benefited from stocks valued at 18 million, specifies in World Hervé Giaoui, president of Cafom.
The brand’s difficulties are today such that it has not been able to honor the purchase of the Habitat brand, in accordance with the agreement planned with Cafom for an amount of 12 million euros, before October 2023. Without waiting for this deadline to expire, the two parties revealed, in March, that they had extended this purchase option to September 2026 and were continuing the exclusive license contract.
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