Burberry Would Rather Burn Merchandise Than Discount It

Burberry, the upmarket British fashion label, has burned more than $37 million of unsold stock in the last 12 months in order to stop it from being sold at discount prices. That brings the total to more than $117 million of Burberry products destroyed over the past five years. The luxury label is famous for its trench coats and handbags.

The company routinely burns unsold products to prevent them from entering the discount market when new lines are released. Last year, Burberry had to destroy a large amount of perfume due to signing a new deal with Coty. About $13 million of old perfume products was burned for this reason.

Environmentalists quickly criticized the move. Lu Yen Roloff of Greenpeace, said, “Despite their high prices, Burberry shows no respect for their own products and the hard work and natural resources that are used to made them. The growing amount of overstock points to overproduction, and instead of slowing down their production, they incinerate perfectly good clothes and products.

Burberry said that it used specialist incinerators to capture the energy generated from burning its products, making it environmentally friendly. A spokesperson for the company said, “Burberry has careful processes in place to minimize the amount of excess stock we produce. On the occasions when disposal of products is necessary, we do so in a responsible manner and we continue to seek ways to reduce and revalue our waste.”

Designer brands commonly destroy unwanted stock to preserve the exclusivity of their goods and prevent them from falling into the hands of illegal counterfeiters. Richemont, the owner of Cartier and Montblanc, destroyed more than $521 million of watches to reduce an excess in goods in the Asian markets. Luxury brands Chanel and Louis Vuitton also burn or destroy unsold stock.

Last November, Burberry announced a revamp that included taking its brand further upmarket, closing stores that are not in “strategic” locations and cutting costs. The moves appear to be paying off. In Burberry’s most recent financial year, the company reported a 5 percent rise in profit, while sales stayed relatively stable.

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