Burberry announces sweeping job cuts and £100m savings push after heavy annual losses and poor global sales.

Luxury fashion house Burberry has announced plans to cut 1,700 jobs globally as part of a sweeping cost-cutting drive, following a disappointing financial year that ended with a £66 million loss.

The dramatic restructuring was revealed by Burberry chief executive Joshua Schulman on Wednesday, as the iconic British brand grapples with faltering sales and rising pressure from shareholders. The job losses, amounting to nearly one-fifth of Burberry’s global workforce, are intended to reduce operational costs by £100 million annually by 2027.

Although the cuts will affect global operations, Schulman confirmed the impact will be most keenly felt in the UK, where a large portion of Burberry’s head office and factory workforce is based.

Among the most affected is Burberry’s Castleford factory in West Yorkshire, which has been producing the brand’s signature trench coats since 1972. The night shift at the facility — where coats can retail for up to £10,000 — is set to be scrapped entirely.

“For a long time we have had overcapacity at that facility, and that is simply not sustainable,” Schulman said. “But I want to be very clear that we are making this change to safeguard our UK manufacturing. We will be making a significant investment to renovate this factory in the second half of the year.”

Staff rotas across retail outlets will also be restructured to “align schedules with peak store traffic,” meaning job reductions in-store are likely as well. The company says the proposed cuts are subject to consultation.

Burberry’s plan includes further savings from procurement, real estate, and operating expenses. It builds on a previous £40 million savings programme launched in November.

Founded in 1856, Burberry has long been synonymous with British fashion and craftsmanship. But recent years have seen the brand struggle, particularly under former chief executive Jonathan Akeroyd, who aimed to reposition Burberry further upmarket. That strategy failed to reverse declining sales, particularly in China and the Americas, and Akeroyd was replaced by Schulman in July 2024.

Under Schulman, formerly of Coach and Jimmy Choo, the company is shifting its focus back to its “historic strengths” — trench coats and scarves — where it retains authenticity and global recognition.

“The continued resilience of our outerwear and scarf categories reaffirms my belief that we have the most opportunity where we have the most authenticity,” Schulman said. “While we are operating against a difficult macroeconomic backdrop and are still in the early stages of our turnaround, I am more optimistic than ever that Burberry’s best days are ahead.”

Analysts reacted soberly to the announcement. Russ Mould, investment director at AJ Bell, said: “These are some pretty radical steps in its continuing recovery effort. Schulman is pulling the classic turnaround lever of cutting costs, including a drastic planned reduction in the firm’s headcount.”

Mould also noted that Schulman’s pivot back to the brand’s roots could be the right move: “A strategy of trying to compete with higher-end rivals hasn’t worked out, so it makes sense that under Schulman the company is returning to its historic strengths in classic outerwear products.”

Despite the sweeping changes, Schulman insists the cuts are about survival and future growth — not retreat. Yet with demand for luxury fashion weakening globally and confidence in the brand rattled, Burberry’s transformation plan is likely to face further scrutiny in the months ahead.