Chanel responds to alleged China layoffs

What happened Luxury fashion house Chanel found itself at the center of swirling layoff rumors last week as Chinese media outlet Jiemian News reported plans for a significant downsizing of the brand’s China headquarters in Shanghai. Citing what appeared to be a leaked internal memo, the reports suggested that Chanel intends to reduce its headcount in China from 462 to 373 employees by the end of 2025 — a nearly 20% cut. The document, widely circulated on local platforms, detailed a gradual quarterly reduction in staffing as part of a broader organizational realignment. The memo pointed to a “reprioritization per business needs” and called for “collective agility and energy to focus on highest impact priorities.” What Chanel is saying publicly In response, Chanel issued a rare public rebuttal, dismissing the claims as inaccurate. The French maison stated that the figures quoted in local reports were erroneous and reaffirmed its long-term investment in China, emphasizing ongoing efforts in talent development and retail expansion. “China is a key market for Chanel, and we have full confidence in its long-term potential,” the brand said in an exclusive statement shared with WWD on April 2. “Chanel is maintaining its plans for people development, also upgrading and expanding its retail network in China to continue offering its customers an exceptional and exclusive experience.” The French maison cut 70 roles (around 2.5% of its workforce) in the U.S. in January, with the decision to reduce headcount succeeding previous moves to limit spending and help Chanel “better adapt to the current economic challenges,” the brand said in a statement. The Jing Take This is not the first time Chanel has had to play defense amid mounting speculation around its China operations. In October last year, the house denied earlier rumors of sweeping layoffs across administrative, management, and frontline roles, which claimed reductions as high as 50% in certain departments. Recruitment freezes were also rumored, though never officially confirmed. The recent headlines arrive at a critical moment for the brand. Chanel has been doubling down on high-visibility activations across Greater China, including its Métiers d’Art 2024/25 show in Hangzhou in December, staged against the picturesque backdrop of West Lake. The event generated significant buzz on Chinese social media, with the hashtag #ChanelHangzhouGlobalDebut surging to the top of Weibo’s Hot Search, amassing over 18.84 million views. Yet, despite the viral impact, reviews of the collection were mixed — a familiar pattern for the brand's major fashion showcases. Chanel’s global growth vs. regional pressures Strategically, Chanel’s retail footprint in China remains more exclusive than expansive, with just 18 boutiques compared to the 40 to 50-store networks of competitors like Hermès. This tight distribution model supports its aspirational positioning, but also fuels curiosity and speculation about its behind-the-scenes business moves. Globally, Chanel has continued to perform strongly. The brand reported $19.7 billion in revenue for 2023, up 16% year-on-year. However, earlier this year, it also announced a modest 2.5% workforce reduction in the U.S. — hinting at cost-conscious recalibrations against a cooling luxury backdrop. With Chanel’s 2024 financial results expected next month, all eyes will be on how the house balances narrative control with operational transparency, especially in a market as media-savvy and sentiment-sensitive as China. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

‘No layoffs’ in China: Chanel

Upgrade to Pro

Sectors

Insights

Company

‘No layoffs’ in China: Chanel