Estee Lauder estimates restructuring to cost up to $700m

Estee Lauder has estimated that the charges and costs to undertake restructuring plan as part of the ‘Leading Beauty Forward’ programme will be between $600m and $700m.

The three-year initiative has been launched this month to enable the brand to free-up resources so that it can invest in training, development, reported Globalcosmeticsnews.com.

The firm informed the US Securities and Exchange Commission that costs of $89.7m are meant for optimising the supply chain, and eliminating operations that are underperforming.

Another $48.7m has been allocated for employee-associated restructuring costs.

Earlier this month, the cosmetics brand announced its plans to axe up to 1,200 jobs.

Estee Lauder chief executive Fabrizio Freda was then quoted by Rappler as saying: "Reallocating resources to new capabilities and higher-growth areas, and lowering our cost base will regrettably include selective workforce reductions in certain areas of the company.

"We will make difficult decisions about affected employees with sensitivity, consistent with the values of our company and will make a concerted effort to retrain and redeploy employees wherever possible."

Estee Lauder is a US-based company that manufactures skincare, fragrance and several haircare products. Some of its brands include AERIN, Clinique and Aveda.