Following a drop in sales amid the COVID-19 health crisis, Burberry is to reduce its workforce by 500 positions globally with the inclusion of 150 jobs in its British head offices. The moves are part of the luxury brand’s plans to reduce costs by £55 million, The Guardian reported.
Burberry has 3,500 workers in Britain, and the brand said it would maintain its downtown London and Leeds headquarters. However, it would reduce head office positions through a number of departments. But the brand noted that positions in manufacturing and retail locations were secure per the report.
Retail locations will not shutter beyond Britain. However, the retailer indicated per the report that it sought to “improve retail efficiency.” Burberry Chief Operating Officer Julie Brown said the firm was having its collection of 13 Hong Kong retail locations “under review.” The area once comprised 8 percent of the brand’s sales, but it now represents under 3 percent.
The 500 employment positions compose approximately 5 percent of the organization’s worldwide. Chief Executive Marco Gobbetti said per the report, “We are sharpening our focus on product and making other organisational changes to increase our agility and generate structural savings that we will be able to reinvest into consumer-facing activities to further strengthen our luxury positioning.”
The company had called off its shareholder end-of-year payment in the past, which was valued at roughly £120 million in 2019. It took as a loan £300 million through a business support program supported by the British government.
In separate news, two big British retailers said they would cut more than 5,000 jobs after coming to the realizing that consumers would not likely return to their old habits after a pandemic that has changed retail.
Boots, which the Walgreens Boots Alliance owns, said it would cut 4,000 jobs and close 48 optician locations. In addition, the John Lewis department store chain could lose 1,300 jobs and close eight retail locations.