Yesterday Versace reached an agreement with unions in Italy to move forward with cutting 350 jobs, or about 26 percent of its workforce, by June. The cuts are part of CEO Gian Giacomo Ferraris’s plan to stop bleeding money. He expects operating losses for 2009 to total $42 million, while he estimates sales fell about 19 percent. Ferraris also plans to close down Versace’s three-year-old accessories factory in Milan (though about 37 of those employees will be relocated to Versace’s separate ready-to-wear plant). Accessories being the bread and butter of luxury labels, Ferraris said the cuts won’t mean a reduction in accessories production, and expects accessories to generate 40 percent of revenue this year, up 5 percent from last year.

Ferraris reiterates in Bloomberg the sentiments of many buyers so far this year, which is that 2010 probably won’t be much better than 2009. Not until 2011 does he expect to “break even on the bottom line.”Under Ferraris, Versace also launched a lower-priced line for fall called Versace Collection, which is 30 to 40 percent cheaper than the main line. Meanwhile, the label continues to operate other lines, including Atelier, consisting of custom dresses retailing for upwards of $22,000; the signature collection, which includes menswear and womenswear starting at around $1,100; and Versus, designed by Christopher Kane, which starts at around $280. VIA NYMAG