This movement was not a one-time event, as it occurred at a time when trading was difficult, with company closures and financial problems at major corporations in the UK and the US. In this case, the subsidiary of the Portuguese group has been in the process of withdrawing for years. In 2020, when the pandemic hit trading activities, A Loja do Gato Preto had 25 companies in Spain and had plans to expand, as stated in its annual report for that year. Now, with the latest planned closure, its network will be reduced to eight stores: two in Madrid, two in Catalonia and four in Andalusia. All are located in shopping centers.

In parallel, three Labor Regulation Files (ERE) in just six months. The layoffs that saw the workforce reach 200 people in 2020 have been reduced by less than half. “They say that business has changed, and now people are buying online,” said Adrián Reyes, chairman of Union Action UGT Comercio, which has negotiated the terms of the ERE.

Reyes focused on the company’s lack of information. “They haven’t given us their 2022 annual report yet”, referring to last year’s closed results, which is where the subsidiary’s financial health should be detailed.

Intention to live in Spain

The company also did not answer questions from elDiario.es about the reasons for the closure and layoffs. “At the moment we cannot give a statement because the negotiations are ongoing in accordance with the regulations in force, but our intention is to keep the brand in Spain,” he said via email. Also about how many shops he plans to occupy. “This is an internal process and we don’t have any information to provide you at this time,” they added in a second email.

Regarding ERE conditions, unions reported that compensation amounted to 95% of the equivalent of unfair dismissal (45 or 33 working days per year) and was capped with a maximum of 18 monthly payments. This affected, in total, 20 store employees in the Mediterráneo shopping center and Parque Comercial Gran Plaza, in Almería; from Mataró Park (Barcelona) and the Madrid venue in Velázquez. In the first half of this year, the network’s Portuguese subsidiary had reported 45 terminations, of employees it had in stores in Madrid, Malaga, Girona and Valladolid.

On this occasion, according to the union, it does not anticipate that there will be another cut, because A Loja do Gato Preto has stated that it “does not intend to terminate a new contract for the next 6 months, that is, until March 31, 2024”. In addition, an additional fee has been agreed in case of late payment. Specifically, one at 25% per annum in respect of the first three payments (October, November and December) and 50% per annum for the remainder of the last three fixed payments (January, February and March 2024), on amounts not yet paid as of date, as demonstrated by UGT.

Change of owner just before the pandemic

A Loja do Gato Preto was born in 1986 with a focus on decoration and in 2002 opened in Spain. Just before the pandemic, as explained in its 2020 annual report – the last available on the Mercantile Registry – changed hands. “On January 9, 100% of the capital was acquired by Grupo Aquinos, which specializes in the manufacture of sofas and mattresses,” he argued. “Since then, we are part of a larger Portuguese group that will allow us greater project, visibility and corporate modernization in the difficult specialty retail sector.”

That year, the pandemic took a toll on his income. 38% was cut as it rose from 19.5 to 12 million euros. But the red number was lowered from 2.9 to 1.2 million. Of course the accumulated losses from previous years were more than 13.6 million.

The company is not talking now about its plans in Spain, but commented two years ago that it intends to grow. Its CEO, Joaquim Pássaro, confirmed in March 2021, in a interview in the Portuguese newspaper Dinheiro Vivo, which is looking to open up to seven stores in three years in France, Germany and Italy, and is analyzing options in the UK. Also, they changed the name to Gato Preto because those two words centered more on the brand’s DNA.

In the 2020 report, the subsidiary stated that it was undergoing a transformation process related to “rebranding”. They also concluded a process called “turnaround”, which involved “the stabilization of the team in the new organization set to meet the challenges facing the company within the scope of its strategic plan and for the next three years”.

And he’s convinced that he wants to grow in online sales and in an omnichannel strategy. In that year, the year of the pandemic was a year full of surprises, as was the case with other distribution companies that focused on furniture and decoration, whose sales increased along with social restrictions. In the case of A Loja do Gato Preto, its activity in e-commerce jumped more than 67% in that year, although the amount was still small, approaching 581,000 euros.