Job cuts loom at Burberry

United Kingdom
Published:  20 July, 2020

The British luxury brand is said to be in talks to eliminate 5% of its workforce internationally, the equivalent of 500 jobs, to offset the damage to its business caused by the pandemic and to pave the way for recovery. 

According to media reports, that number includes 150 office-based roles at the UK headquarters; however, the company stressed there would be no cuts to manufacturing or shop floor jobs in its domestic market. The restructure also includes rationalisation of office space and retail operations and is expected to deliver savings of around £35 million (US$44.1 million) in fiscal 2020-21, with annualised savings of £55 million (US$ 69.2 million) and an associated one-off restructuring charge of £45 million (US$ 56.7 million).Burberry said those savings are in addition to the previously announced £140 million (US$ 176.3 million) cumulative cost saving program.

As part of a wider move to tighten operations and “to sharpen the focus on product, agility and efficiency,” Burberry is in the process of setting up three new business units: ready-to-wear, accessories and shoes, with each unit having dedicated commercial planning, merchandising and product development teams. Previously, those teams had worked across all three categories.

As reported in ILM, Burberry’s sales declined 45% in the first quarter.

Source: Yahoo Finance