Burberry Will Be "Starting" To High-End Consumers.

After confirmation of the departure of Christopher Bailey, Burberry CEO Marco Gobbetti announced

The main goal of the comprehensive reform is to refocus the brand positioning on the high-end.

Consumer.

According to the world clothing and shoe net, Julian Easthope, an analyst at Barclays Bank, expects the third quarter year-on-year sales to grow by 3%, which is also a positive growth in the sixth quarter, and sales of Burberry have also been given Christmas gifts.

A boost.

Back in November, Gobbetti innovates the company's development strategy. On the basis of a clearer brand positioning, Burberry will substantially reduce the number of stores, especially those that affect wholesale business. In addition, Burberry will also give up some of its poor shopping malls "store stores" and close stores that are not close to high-end luxury consumer communities.

In this regard, citing Gargreaves Lansdown stock analyst Nicholas Hyett, Burberry said that it is progressing well, and it is expected that there will be strong earnings momentum and truly control the fate of the brand. Of course, the plan is still in its early stage.

Hyett also warned the market situation, "brand authority will be affected by sales figures."

Although analysts are positive about the potential of Burberry, the brand is still facing the conflict between higher capital requirements and lower sales figures in the short term.

Burberry shares fell 10% on the day of the press release.

The smooth implementation of the new brand strategy will be the primary task of Burberry in the new year, and it is also a potential driving force for share price.

Christopher Bailey

In October 31, 2017, Christopher Bailey, President and creative director of Burberry, confirmed that he would be leaving in March 31, 2018. During the 17 years when Bailey joined the Burberry, he led the brand to undergo a series of pformation. Earlier this year, Bailey had taken off the title of the chief executive of the brand -- his two major positions as chief executive officer and creative director, which is rare in the field of luxury brands. His step by step may partly indicate that the creative personnel may not be able to take account of the operation of professional managers.

In July 2017, Marco Gobbetti took over as chief executive of Burberry. Before that, the outside world had always thought that the position of CEO who took over by Gobbetti was really hot. In its annual report of fiscal year 2016, which was announced before its appointment, data showed that the company experienced a 10% decline in performance and a 7.3% drop in profits.

In addition, he needs to continue to complete the goal of substantially reducing costs for the group in the last two fiscal year: the target of fiscal year 2018 is 50 million pounds, and in 2019 it will grow to 100 million pounds.

Incumbent CEO Marco Gobbetti

After the Gobbetti took office, the performance significantly rebounded, mainly due to the strong sales results in the Chinese and British markets. The sales in the mainland of China mainly increased by 15% based on the layout of WeChat advertising and distribution network. Meanwhile, the market in Hongkong also had the signal of growth opportunities due to the rebound in the number of tourists in China, while the British market had gained the good result of the decline in the pound.

In addition, one of the tasks that Gobbetti has already completed is to announce the decision to shelve Liz's plan to build a factory after discussing with senior executives.

The establishment of the new project will initially make the knitting and windbreaker production in the same place, and thus create 200 new posts, which is also regarded as an important part of the company's 50 million pound downsizing plan.

Investors' argument over the high pay of their top management team is also a top priority for Gobbetti to tackle. In the group's consideration of cost reduction, Christopher Bailey and chief financial officer Julie Brown have given up their bonuses.

HSBC has made negative comments on the above series of financial compression efforts made by Burberry, saying that reducing costs can only protect the short-term profits of the group. "The survival and development of luxury brands still depend on sales growth rather than cost control."

We can see that after experiencing the turmoil of personnel, there are still many tests that Gobbetti needs to accept.

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