Burberry will close its under-performing Thomas Burberry brand and axe up to 290 jobs at its South Yorkshire factory, after the luxury brand reported a 3% fall in like-for-like sales at its stores.
The closure of Burberry’s lower-priced bridge brand is part of a £50 million cost-saving initiative which could also lead to a further 250 redundancies in Spain as the business restructures its operation there.
Thomas Burberry, which sells in retailers including Urban Outfitters and on etailer Asos, was relaunched to the UK wholesale market in 2003 after a break of a few years.
Charlie Peel, menswear buyer at independent department store Williams & Griffin in Colchester, Essex, said: “The brand never recovered from being pulled the first time. When they brought it back a few years ago, people had moved on.”
Burberry’s sewing factory in Rotherham, South Yorkshire, will be closed and supporting operations scaled back, which could result in up to 290 job losses. Burberry’s Castleford manufacturing facility in West Yorkshire will stay open.
Group underlying sales rose 9% to £329m for the third quarter to December 31. Underlying wholesale revenue grew by 8% to £95m over the period.
However, the luxury brand said it expected its wholesale arm to be down by a high single-digit percentage on an underlying basis for the second half.