NEW YORK — As part of a major restructuring plan, Fila has laid off 550 of its 1,900 employees, representing 29 percent of its workforce.
Of the 550 pink slips being handed out, 350 are in Europe, with the bulk of them in Italy, the brand’s former base. Fila was based in Biella, Italy, until Sports Brand International finalized its $351 million purchase of Fila’s worldwide subsidiaries from Fila Holding SpA in June.
The news was especially hard to take in Biella, where most of the Italian job cuts are taking place. Sergio Perino, a regional representative for the national union CGIL, said workers are striking, demonstrating and requesting political intervention to prevent the job cuts.
“The logic [of the cuts] escapes us,” Perino said. “These are not just numbers, these are people.”
In a statement, Jon Epstein, SBI’s chief executive officer who previously headed Fila USA, said the decision to institute layoffs was needed “to compete and prosper on a long-term basis.”
“The strategic reorganization is another critical step in making Fila an efficient and flexible organization in a highly competitive market and in building a solid foundation for the company’s future growth,” he said.
Epstein has been busy analyzing the business, beefing up senior management and enhancing core products with more of a fashion flair. This month, the company will close its footwear research and development facility in Peabody, Mass., shifting those functions to Montebelluna, Italy. Fila will shutter its 14 factory outlet stores in the U.S. by the end of the year. There are also plans to shift its footwear sourcing center to China from Taiwan.
Fila executives in the company’s Spark, Md., office could not be reached for comment Monday and staffers in the New York office declined to comment.
Fila is still exploring “the disposition of nonstrategic assets and alternative courses of action to improve its presence in the different markets,” according to the statement.
Under the new management, the brand is focusing on key markets, trying to reduce the lead time and streamlining the corporate structure. Regional headquarters are being set up in Maryland, Milan and Seoul. The company plans to strengthen the apparel and footwear design team and its marketing team in Sparks and New York.
Fila has signed a deal with Proline, a subsidiary of Mint Apparel in the U.K. Through the new deal, Proline will handle the brand’s sales and operations in the U.K. and will help with product design, development and sourcing.