Gallering Through Uncertainty: Employees Wade through Signa's Insolvency
The storefront at Galeria on Düsseldorf's Königstraße stands vibrant, as crowds of shoppers enter and leave carrying hefty shopping bags. Christmas tunes fill the air, while just across the street, Carsch lies hidden behind a construction fence, its future in limbo. The bustling department store and the stagnant construction site perfectly encapsulate the paradox of the entire Signa universe.
The looming question: "What now?" This sentiment has been prevalent among the roughly 13,800 Galeria Kaufhof Karstadt employees ever since the potential sale of the German department store chain was announced at the end of November.
Many employees choose to remain silent on the situation, fearing the consequences of voicing their concerns publicly. They worry about the wrath of management or colleagues turning against them due to their statements, which may affect the continued existence of their store. Many believe that the best course of action is to "keep their head down" because no one can predict how long this crisis shall last.
Ulrich Wiegard, Head of the Works Council at the Galeria store at Hermannplatz, Berlin, shares the sentiment of many employees and fears a mass exodus due to the uncertain situation. "It's particularly bitter for the employees because it's not their fault," he remarks. Such comments are a common theme among customers during the Christmas season, as some ask for discounts on certain items, and others inquire about possible store closures.
However, some suppliers have begun demanding advance payments, causing a feeling of discomfort among employees. Wiegard states, "You go through this Christmas period with a queasy feeling. Who knows how long this will last." He hopes that an investor will be found, and the uncertainty will give way to security and continuity.
Galeria spokesperson confirms that they practice open communication with employees, updating them on a regular basis, through store management, about good sales as well as Signa's situation. They are also focusing their resources on the core business, hiring temporary workers to prepare for the Christmas season.
Thomas Vieweg, Head of the Works Council at the store in Nuremberg, echoes the optimism of his colleagues when he states that Galeria's performance is going well, with employees noticing a positive change across the company. Despite the persistent talk of the death of department stores, Vieweg remains hopeful about the future, thinking that strong sales are vital for maintaining liquidity.
Retail expert Johannes Berentzen does not believe that Galeria can be saved and foresees an imminent insolvency filing in the spring. However, he remains confident that employees will find excellent employment opportunities in other sectors, such as catering and hospitality, as the demand for skilled workers remains high in the retail sector.
Joffrey Kallweit, head of the works council at the Galeria store in Dortmund, expresses the feelings of his colleagues during this difficult period. "The mood is not good... but they're not letting themselves down." Kallweit expresses optimism, believing that they will persevere as they have in the past.
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Enrichment Data
The current situation of Galeria Kaufhof Karstadt employees is tenuous in light of Signa Holding's insolvency, highlighting a series of challenges. On November 29, 2023, Signa Holding filed for insolvency in Austria due to financial pressure and unfavorable business conditions. This filing affected the large department store chain, Galeria Karstadt Kaufhof, which had already faced previous insolvencies in 2020 and 2022.
In response, a consortium, led by NRDC Equity Partners, with support from Richard Baker (co-owner of Hudson's Bay Company) and Bernd Beetz, has stepped forward to acquire approximately 70 of the insolvent chain's stores, aiming to revitalize the struggling retail business and provide stability for its employees. If this acquisition is successful, it could result in a more secure future for the remaining stores and employees, although the details of the acquisition and its impact remain unclear.
Sources:
- "Signa files for insolvency" -
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