Burberry criticised for ‘wasteful’ stock destruction

A decision by UK fashion firm Burberry to destroy £28.6m-worth of stock to guard against counterfeits has drawn criticism from groups who say the practice is wasteful and damaging to the environment.

Burberry revealed the destruction in its latest annual report, which also trumpets its commitment to becoming carbon neutral, and “reducing, reusing and recycling” any waste created in its business. The incinerated goods included around £10m-worth of products from its cosmetics and beauty range.

The company says the move is all about protecting its intellectual property and making sure the surplus stock doesn’t end up being diverted for sale on the black or grey markets, devaluing its brand, while industry observers also say that it is also about recovering duties on exported goods. That can take place on destroyed goods, but not those that end up in discount sales.

While Burberry is the company in the spotlight at the moment for the practice, it seems it’s a widespread phenomenon in the fashion industry, although companies aren’t required to reveal whether they do so. One documented case involves Cartier, Piaget and Montblanc parent Richemont, which reportedly bought back and destroyed $€200m-worth of unsold luxury watches earlier this year, denting its profits. Another case involved Swedish retailer H&M, which was accused last year of burning 60 tonnes of unsold garments since 2013 but denies the claims.

Burberry said in a statement that it "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.”

It also said that destroying the cosmetics was a one-off and resulted from the licensing of its Burberry Beauty lines to US company Coty, but the move hasn’t gone down well with some shareholders. One investor asked at its annual meeting last week why shareholders couldn’t be given the opportunity to buy the unsold items. Meanwhile, customers have taken to Twitter to register their disapproval:

Main image courtesy of StockSnap / Pixabay

Related articles:

     Want our news sent directly to your inbox?

Yes please 2


Home  |  About us  |  Contact us  |  Advertise  |  Links  |  Partners  |  Privacy Policy  |   |  RSS feed   |  back to top