Burberry’s boss reveals the British plan as he tries to revive the luxury brand’s fortunes
Burberry’s boss yesterday vowed to return the brand’s focus to “timeless British luxury” as he outlined plans to revive its fortunes and fend off takeover talk.
Joshua Schulman, who took over the top job in July, admitted that the company, best known for its trench coats, had lost its way in recent years.
But he emphasized that the 168-year-old company had a strong future as an independent company.
It comes amid recent speculation that Burberry, whose share price has fallen by two-thirds since April 2023, could be snapped up by Italian skiwear company Moncler.
Turnaround plan: Burberry boss Joshua Schulman, who took the top job in July, admitted the company, best known for its trench coats, had lost its way in recent years
Schulman, a New Yorker, impressed investors after promising to highlight the company’s outerwear offerings, including its signature plaid jackets and scarves.
He said the current marketing campaign ‘It’s always Burberry weather’ – featuring British stars such as Oscar winner Olivia Colman sipping tea and enjoying the amazing British countryside – has already helped improve the perception of the brand.
And the group will spend less energy on “niche” and “modern” designs, which are “targeted at a narrow base of luxury customers,” Schulman said.
“We focus on timeless British luxury, juxtaposing heritage and innovation across all our touchpoints in a more recognizable expression of Burberry,” he said.
His emphasis on the need for change was underlined by results which showed a 20 per cent fall in sales in the six months to September 28, as this swung to a pre-tax loss of £80 million.
Schulman, who took over from Jonathan Akeroyd, said he was on a mission to “course correct” after mismanagement of the brand and its core products.
Prices for products like handbags had risen too high, Schulman added, and Burberry would now offer a wider range of prices on flagship outerwear products. Currently the jackets range from £1,150 to £7,900.
But Schulman was confident that the group would still maintain its desirable luxury status and was in no hurry to lower prices to become “accessible.”
Questions have been raised about creative director Daniel Lee’s future at the company.
But Schulman said yesterday, “everyone is focused on the same results, and everyone works very well together.”
Chairman Gerry Murphy has previously said the company “probably went a bit too far and too fast” in raising prices and targeting a super-rich group.
Against the backdrop of the swirling takeover talks, Schulman said landlords and customers see “benefits for Burberry to be an independent luxury brand” as it sets it apart from fashion house rivals.
This will have been reassuring news for those who fear that Burberry could be the next to leave the London stock market.
Both Moncler and Burberry have declined to comment on rumors of a bid.
Schulman, the former boss of handbag maker Michael Kors, struck an optimistic tone when he announced an ambition for annual turnover to reach £3 billion – although he gave no deadline for this.
AJ Bell investment director Russ Mold warned: ‘The one thing Schulman has no control over is Chinese consumer confidence, with the weak situation in China being extremely unhelpful for Burberry given its dependence on this market in recent years.’
DIY INVESTMENT PLATFORMS
A. J. Bell
A. J. Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund trading and investment ideas
interactive investor
interactive investor
Invest for a fixed amount from € 4.99 per month
Sax
Sax
Receive €200 back in trading fees
Trade 212
Trade 212
Free trading and no account fees
Affiliate links: If you purchase a product, This is Money may earn a commission. These deals have been chosen by our editors because we believe they are worth highlighting. This does not affect our editorial independence.