Burberry is going to cut 500 jobs, 150 of which in its British headquarters. Along with other measures, this should save the luxury brand 60 million euros annually.
Burberry has been hit hard by the coronavirus crisis: its retail sales have dropped 48 % in the past three months, The Guardian reports. In Europe and the Middle-East, the drop was as big as 75 %. In its British home market, the luxury brand suffered from the decrease in tourists and the fact that stores have been closed for longer than throughout the rest of Europe.
It will be in Britain, therefore, that Burberry will take the toughest measures. 150 of the 3500 employees in the United Kingdom will lose their jobs. Efficiency will have to improve outside of the UK as well, even though the company says no foreign shops will be closed for the time being. Stores may lose some staff, while more staff working from home will allow the company to reduce the amount of office rent it pays.
The situation in Hong Kong is as of yet too uncertain to make reliable forecasts, Burberry said: sales have fallen dramatically due to the tensions with China and the coronavirus outbreak. COO Julie Brown only said that the company "is evaluating" the situation in the area.
All measures combined should be able to lower the company's costs by 55 million pounds (60 million euros) per year - a sum that will be reinvested in marketing (pop-up stores, digital campaigns and events). These new cuts come on top of an earlier set of measures that was designed to save 140 million pond (150 million euro).