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Burberry cost cutting could see store closures

With an incoming chief executive a business will always undergo change, especially a company the size of British retailer Burberry.

Marco Gobbetti, who has relinquished chief designer Christopher Bailey of his management duties, is expected to visit all of Burberry's 500 stores as part of its turnaround efforts.

Gobbetti will see firsthand which stores are working, which require updating and which could be considered for closure.

Gobbetti, who started online one month ago, has the grand task of implementing the changes to deliver strong sales and pave the future for the iconic British brand.

Although Burberry posted a three per cent rise in sales the three months to June, largely driven by strong UK and Chinese sales, the new boss has taken on the task of cutting 100 million pounds from costs by 2019, reports the Retail Gazette.

In his previous role at Celine, Gobbetti earned a reputation for being tough on store quality, closing more stores than he opened while in charge.

In recent years Burberry has hammered ahead with store openings to meet increasing Chinese demand.

The tour is already underway in the US where Burberry operates from 74 stores, according to This is Money.

This market was one of the least profitable for the retailer last year, with sales falling five per cent in the year to March.

Photo credit: Burberry