Burberry unveils turnaround plan as it swings to half year loss
Burberry has announced a new turnaround initiative as it looks to “reignite” its appeal to to luxury customers, improve performance and drive long-term value creation.
The fashion brand unveiled the plans as it reported its results for the six months ending 28 September.
During the period, the company posted an adjusted operating loss of £41 million compared to a profit of £223 million at the same time in the prior year.
Meanwhile revenue fell by 20% to £1.09 billion.
Burberry said its new strategy includes offering timeless British luxury in which it will lead with its signature outerwear. It will also be working to foster a high performance culture and capabilities and will be aligning distribution with product and its customer strategy.
Actions taken in the last 90 days have included the launch of its “It’s Always Burberry Weather” Outerwear campaign and “Wrapped in Burberry” Festive campaign to reset the brand in the eyes of customers.
It has also revamped its visual merchandising to accentuate outerwear and scarves in stores and updated styling online to appeal to a broad range of luxury customers.
In a further move, Burberry has appointed new leaders within marketing, product merchandising and planning, as well as in its Americas region.
It has also implemented a cost saving programme and is working to address inventory overhang and restore scarcity.
Joshua Schulman, chief executive of Burberry, said: “Burberry’s original purpose to design clothing that protects people from the weather is more relevant than ever. Our recent underperformance has stemmed from several factors, including inconsistent brand execution and a lack of focus on our core outerwear category and our core customer segments.
“Today, we are acting with urgency to course correct, stabilise the business and position Burberry for a return to sustainable, profitable growth. We have a powerful brand with broad appeal among luxury customers, authority in the outerwear and scarf categories which have remained resilient through this period, and a strong presence in all key luxury markets.
“Now, we have a clear framework to reignite brand desire, improve our performance and drive long-term value creation. Building on our strong foundations, I am confident that Burberry’s best days are ahead.”
