Burberry's Bold Move: 1,700 Jobs at Risk as Company Faces £66m Loss

Burberry, the iconic British luxury fashion house, is facing significant challenges as it plans to cut approximately 1,700 jobs in a bid to reduce costs by 2027. This decision follows a startling £66 million loss reported for the previous financial year. As part of the restructuring, almost 20% of Burberry’s global workforce could be affected, with significant cuts anticipated at the Castleford factory in West Yorkshire, a site known for producing its famously priced trench coats.

CEO Joshua Schulman, appointed only last year, emphasized that while the majority of job losses would occur at the brand’s head office teams worldwide, the focus would primarily be on the UK due to the concentration of staff. Notable changes include scrapping night shifts at the Castleford facility, which has been deemed unsustainable due to overcapacity. Schulman stated, “For a long time we have had overcapacity at that facility, and that is simply not sustainable,” while also assuring that investment to renovate this factory would take place in the latter half of the year.

In addition to job cuts, Burberry aims to streamline operations by aligning staff schedules with peak store traffic and improving procurement and real estate efficiency—these adjustments are positioned to save an annualized total of £100 million by Spring 2027.

While Burberry’s iconic products such as outerwear and scarves continue to perform well, Schulman faces the challenge of revitalizing the brand against a difficult economic backdrop and declining luxury goods demand, particularly in China and the Americas. Investment director Russ Mould highlighted Schulman’s strategy of slashing costs as a classic turnaround maneuver, indicating a return to Burberry’s traditional strengths rather than pursuing higher-end market strategies that previously yielded poor results.

The continual shifts in leadership and strategy signal a bold attempt to realign Burberry with its core customers while injecting some innovative freshness into its offerings. In the face of these operational changes and market pressures, Burberry’s future hangs in the balance as it seeks to navigate this tumultuous period.