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Tuesday, October 6, 2015

bebe Cuts Several Design, Merchandising, and Production Jobs

Another clothing retailer making employment moves.

On October 1, 2015 bebe stores, inc. announced that, as a result of the Company’s focus on more streamlined lifestyle assortments and increased efficiencies across business functions, it has implemented a workforce reorganization.  In other words, they are reducing the number of employees.

This reorganization will include the reduction of over 50 positions primarily in the design, merchandising, and production areas.

The Company expects pre-tax costs associated with this initiative to be approximately $1.5 million, and anticipates annual cost savings of approximately $4.8 million.   In addition, according to their press release, Manny Mashouf, Chairman of the Board of bebe, will be re-engaged with the Company, working closely with the design and merchandise teams to help guide this initiative.   We wonder if Manny believes that his assistance in the design and production process will help alleviate the disruption potentially caused by the 50 plus people being downsized.  Let’s assume the board had limited options and had to reduce the work force.  But let’s not assume or be convinced that one person’s assistance (no matter how qualified they may be) can replace the work being done each day by 50 plus people.

bebe also announced on October 1st that the Company's Board of Directors has authorized a $5 million share repurchase program.  Share repurchases may be made in open market or privately negotiated transactions, subject to market conditions, applicable legal requirements and trading restrictions under the Company's insider trading policy.  The program may be suspended or discontinued at any time.

Jim Wiggett, Chief Executive Officer, said, “While the decision to reduce our workforce did not come easily, it was believed to be in the best long term interest of the Company. We appreciate the dedication of the affected employees and thank them for their efforts.”

Mr. Mashouf commented, “I am excited to be working closely with a very talented group of designers and merchants. I look forward to collaborating with the teams to create great, innovative, branded product that speaks to the needs of the bebe woman. ”

bebe stores, inc. is a global specialty retailer, which designs, develops and produces a distinctive line of contemporary women’s apparel and accessories under the bebe and BEBE SPORT brand names. bebe currently operates 163 bebe retail stores, the on-line store, www.bebe.com, and 37 bebe outlet stores. These stores are located in the United States, Puerto Rico and Canada. bebe also distributes and sells bebe branded product in approximately 100 doors through its licensees in 20 plus countries.

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