RESHORING CASE

Burberry

Company details
Code: 
Burberry
Company name: 
Burberry
Company country: 
United Kingdom
Number of employees: 
10851
Sector: 
C - Manufacturing
Sector detail: 
C14 - Manufacture of wearing apparel
Sub-sectors: 
C14.1 - Manufacture of wearing apparel, except fur apparel
C14.1.9 - Manufacture of other wearing apparel and accessories
Reshoring details
Reshoring announcement date: 
03/11/2015
Starting implementation date: 
January, 2012
End of Implementation : 
December, 2018
Reshored to: 
United Kingdom
Location of affected unit(s): 
Leeds
Location code: 
UKE42
Reshored business function: 
Production
Partial or Total reshoring: 
Partial
Reshoring governance mode: 
In house (in own facilities)
Estimated job gains: 
200
Reasons for reshoring: 
"Made in" effect
Risk of brand counterfeiting
Unattractiveness of the offshore market
Case narrative: 

Burberry is a famous fashion brand established in Britain in 1856 and has more than ten thousand employees.
In 2012, critiques were made against the company due to the fact most of the production was not made in Britain. Pressure from customers led to the backshoring of part of the company's production from Asia to the UK. Moreover, Asian markets' appeal has decreased while the "Made in" effect for luxury products has grown in relevance. Burberry faced a slowdown in its key Asian markets which has sent the company’s share price falling.

As a result, in 2015 the company announced that it intented to invest at least £50m in a new UK factory to produce its trademark trenchcoats, creating 200 extra jobs in Yorkshire. The facility in Leeds will draw together production of the coats and the gaberdine cloth they are made from – currently made at two separate sites in Castleford and Keighley.

All 800 current staff are expected to move to the new site by 2018, which will give Burberry the capacity to potentially triple its current UK production of 5,000 coats a week. Work on the new factory will start next year.

 

Sources: 

The Guardian, 3 November 2015

Offshoring details
Offshoring location: 
China
Offshored business function: 
Production