Newly-minted Burberry chief executive Joshua Schulman will use the brand's UK heritage in a bid to win back customers and turn around the loss-making company's fortunes. The revamp will see a renewed focus on trench coats and scarves with the distinctive Burberry check, with a less ambitious pricing strategy on bags and shoes. Mr Schulman, who took up the top post in July, has also announced the launch of a £40 million cost savings programme that will result in an unspecified number of job losses.
"We took pricing too high across the board," Mr Schulman said at an analysts' briefing "We created new brand codes...
that were not familiar or recognisable for our customers." Read more: New Burberry chief to return to brand's British roots His comments came after Burberry posted an adjusted operating loss of £41m for the six months to the end of September, with the company suffering more than its peers from consumers' waning appetite for luxury goods in China and elsewhere. There will be a £29m inventory writedown to get rid of unsold stock.
Sales in Burberry's second quarter fell at the same pace as in the first three months of the year, with revenue for the first half down 20% in constant currencies. Leather goods and shoes underperformed in the first half, Burberry said, while outerwear did better than average. Asked about what had gone wrong at Burberry, Mr Schulman said: "We took pricing too high across the board.
We created new brand codes...
that were not familiar or rec.