luxury brand burns R $ 141 million in products to prevent sales promotions

Decision to incinerate goods by fashion company aims to reduce inventory and prevent products from being sold in promotions, second specialists.
20/07/2018 18h07 - Updated 20/07/2018 18h07
Photo: disclosure

Burberry, famous British luxury fashion brand, incinerated clothes, accessories and perfumes not sold in the amount of 28,6 million pounds – or equivalent to R $ 141,7 millions – last year to preserve the brand.

In the last five years, the total value of goods destroyed by Burberry surpasses 90 million pounds – R$ 446 millions.

fashion companies often destroy unsold goods to prevent them from being stolen or sold for low price.

Burberry says the carbon dioxide emitted by the burning of the products was offset, making the action “environmentally sustainable”.

Rubbish on luxury fashion
“Burberry has careful procedures to minimize excessive inventory to produce. On the occasions that the disposal of products is required, we do it responsibly and continue to seek ways to reduce our waste and redeveloped”, said a company spokesman.

The company said last year was atypical, because it had to destroy a lot of perfume after signing a contract with the American company Coty.

As Coty produced new stocks, Burberry decided to dismiss 10 million pounds of old products – mainly perfume.

In the last years, Burberry has strived to become the exclusive brand again after a period in which counterfeiters “They put the Burberry label on everything they could”, said Mary Malone, who teaches about the fashion industry at Manchester Metropolitan University.

And destroy unwanted products is part of this process, she said.

“They are doing this so that the market is not flooded with promotions. They do not want the Burberry products from falling into the hands of those who can sell them at a discount and devalue the brand”, disse Malone.

environmental costs of the fashion industry
Burberry is not the only company to deal with excessive luxury stocks.

A Richemont, owner of brands Cartier and Montblanc, We had to buy back watches worth 480 millions of euros (R$ 2,1 billion) the last two years.

Analysts say part of the clocks would be recycled – and the rest, thrown away.

Environmentalists complain the generated waste.

“Despite their high prices, Burberry shows no respect for their own products, the hard work and the natural resources used to manufacture them”, Lu Yen Roloff diz, do Greenpeace.

“The increasing amount of surplus stocks indicates that there is overproduction, e, rather than reduce its production, they burn clothes and products in perfect condition.”

“It's a dirty secret of the fashion industry. Burberry is the tip of the iceberg”, she says.

Dilemma of luxury brands
Tim Jackson, director of the British School of Fashion at the London campus of Glasgow Caledonian University, says fashion brands like Burberry live a paradox.

To satisfy shareholders, they must continue to expand, even at the risk of “dilute their identity and create excess inventory”, disse Jackson.

“They never have to solve this problem.”

In November, Burberry announced an action to “reenergizar” your products.

This includes raising the status of the brand, close stores that were not in places “strategic” and create a center of excellence for luxury leather goods.

The company also cut spending, which helped increase profits.

In its last fiscal year, ended 31 March, the company reported an increase of 5% profit, they came to 414 million pounds (R$ 2 billion), with sales reaching 2,7 billion pounds (R$ 13,3 billion).

Source: G1


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