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Layoffs hit Bolingbrook-based Ulta Beauty as makeup sales remain sluggish during pandemic

Layoffs hit Bolingbrook-based Ulta Beauty as makeup sales remain sluggish during pandemic

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Ulta Beauty

BOLINGBROOK — Ulta Beauty has laid off corporate and field management employees as it adjusts to the impact of the COVID-19 pandemic.

Eileen Ziesemer, spokeswoman for the Bolingbrook-based beauty retailer, declined to specify the number of workers or locations affected but said it was a “meaningful but relatively small” share of its employees. The layoffs took effect Tuesday.

“While incredibly difficult, these decisions were made thoughtfully with a focus on resetting our corporate cost structure to operate more effectively and efficiently in the short-term as well as optimizing our enterprise capabilities to thrive in the long-term,” Ziesemer said in a statement.

Ulta also eliminated open roles, reorganized some groups and added a small number of new roles in areas the retailer plans to invest in, Ziesemer said.

As of Feb. 1, before the pandemic, Ulta had about 18,000 full-time and 26,000 part-time employees, according to its most recent annual report.

While Tuesday’s cuts were the first affecting corporate employees since the pandemic began, many store associates have been furloughed, and the retailer eliminated two of the management roles at stores to create a new, combined role in November.

More than half the furloughed employees have been called back, the company said last month. While nearly all stores are open, some services remain limited. Ulta has 1,262 stores in the U.S., including 55 in Illinois.

Ulta had been growing through mid-March, but COVID-19 has been tough on many retailers and the beauty industry is no exception. Ulta’s stores were closed for weeks, and sales remained down even as stores reopened. Sales online and at stores open at least 14 months fell nearly 9% during the 13 weeks leading up to Oct. 31 compared with the same period the prior year.

Makeup sales struggled as many consumers remained home, though products used “above the mask” performed better, CEO Mary Dillon said during a call with investors last month. Meanwhile, sales of fragrance, bath and skin care products grew as consumers sought self-care, she said.

Ulta halted its planned expansion into Canada to focus on growing its U.S. business but new store openings, which paused temporarily during the pandemic, have resumed. Ulta opened 17 stores during the third quarter of 2020 but closed 19. The retailer said it expects to open at least 30 during the 2021 fiscal year.

That doesn’t include stores that will open inside Target stores, giving Ulta access to a broader customer base. In November, the retailers announced a partnership that will put scaled-down Ulta shops in 100 Target stores next year.

Crain’s Chicago Business first reported news of the layoffs.


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