Burberry’s retail-led growth strategy is focused on digital integration. The company is investing in underpenetrated markets such as Asia Pacific and Latin America as continued growth in luxury goods sales is forecast. The company’s targets are 25 of the world's wealthier cities, as these benefit from high levels of tourism and high net worth residents.
Features and benefits
MarketLine Case Studies describe topics such as innovative products, business models, and significant company acquisitions.
Fact-based and presented in an accessible style, they explain the rationale of commercial designs and illustrate wider market and economic trends.
Burberry recorded a 35% revenue increase in 2010/11 compared to the previous year. China contributed 5% to underlying growth. Non-apparel, including handbags, small leather goods, scarves, shoes, belts and jewelry, remain key drivers of the company’s growth, contributing 40% of retail/wholesale sales during 2010/11.
The company increased the number of directly operated stores by 105 in 2010/11. Overall Burberry store productivity increased by 11% in 2010/11. Average unit retail prices rose during the period, while product flow and replenishment capability improved. About half of the new stores were opened in existing high profile markets.
The company now has 57 shops in China, and this figure is expected to almost double within the next five years. In Latin America, the group now has three stores operating. Through franchise partners, the first Burberry stores were opened in Armenia, Egypt, Israel, and Mongolia during 2010/11.
Your key questions answered
How is Burberry delivering such a strong performance during a period when many retail businesses are struggling?
What are the opportunities of investing in underdeveloped markets? How does a company imprint a brand image in customers' minds?