Burberry, the renowned British designer brand, has unveiled plans to cut approximately 1,700 jobs as it grapples with significant financial losses. The company, best known for its legendary camel, red, and black check pattern, has recently undergone turmoil. It recently announced a record busting £66 million deficit in the previous financial year. Burberry announced a new £100 million cost-savings plan that will start by Spring 2027. This move is expected to produce a close to 20% reduction in its headcount worldwide, with the brunt of staff layoffs coming from head office teams globally.
Founded in 1856, Burberry has a long history of craftsmanship, particularly known for producing high-quality raincoats in Yorkshire since 1972. The company operates an apotex manufacturing facility in Castleford, West Yorkshire. There, it manufactures trench coats that sell for as much as £1,000 to £10,000 a pop. Despite these losses, Burberry’s chief executive, Joshua Schulman, who took over the role in July last year, expressed optimism about the brand’s future.
In Burberry joined the parade of luxury companies announcing cost-savings plans in November, with 39 million. The financial outlook kept worsening, so the company decided more action was necessary. Schulman reiterated the need for these changes in order to continue the viability of UK manufacturing.
“But I want to be very clear that we are making this change to safeguard our UK manufacturing, and in fact we will be making a significant investment to renovate this factory in the second half,” – Joshua Schulman
The bulk of the job losses will be in the UK, where most of Burberry’s workforce is located. Schulman pointed to obstacles raised by the macroeconomic climate, yet projected an optimistic future at hand for the brand’s impending comeback.
“While we are operating against a difficult macroeconomic backdrop and are still in the early stages of our turnaround, I am more optimistic than ever that Burberry’s best days are ahead,” – Joshua Schulman
He pointed out that there’s been chronic overcapacity at their Castleford, ID plant, which he called “just plain not sustainable.” Schulman looks forward to repositioning Burberry for growth by concentrating on the company’s primary talents.
“The continued resilience of our outerwear and scarf categories reaffirms my belief that we have the most opportunity where we have the most authenticity,” – Joshua Schulman
Burberry looks readying itself for seismic structural shifts. They want to better align their operations with store traffic at peak times and improve overall efficiency. The path forward will require careful management of resources and a commitment to quality that has defined Burberry for over a century.