Biography Burberry Cancel Shanghai Big Show

The Chinese mainland market is also starting to sweat the world's luxury brands.

According to the fashion business flash, citing the new crown pneumonia epidemic, the British luxury brand Burberry, which was originally scheduled for April 23rd in Shanghai, was cancelled in the 2020 autumn winter Burberry fashion show for men and women. According to the fashion business flash, the social retail store in Shenzhen, which exclusively works with Tencent, will be delayed.

Since the beginning of this year, Burberry shares have fallen by more than 8%, with a market value of about 8 billion 200 million.

It is noteworthy that this is the creative director RiccardoTisci after joining Burberry for the first time in China. RiccardoTisci thinks Shanghai is "one of the most innovative and enlightening cities in the world". Burberry CEO MarcoGobbetti also said earlier that China has become one of the most important brands, and the brand is also specially launched in the series. A single item for sale.

Some people in the industry say that a fashion show needs to be prepared at least three months in advance. With the spread of global instability, luxury brands need not only worry about unpredictable weather and venue problems, but also need comprehensive risk assessment.

According to the source, as far as mainland China is concerned, if Burberry remains cautious, it will eventually abort the show. In November last year, the French luxury brand Chanel also cancelled the 2019/2020 early spring series fashion show due to the deteriorating retail environment in Hongkong.

To add insult to injury, 24 of Burberry's 64 stores in mainland China have been temporarily closed, while the shops in business have shortened business hours and passenger traffic has dropped significantly, and the brand's annual sales of about 40% are from Chinese consumers. Besides, Chinese consumers can't go out to visit friends during the Spring Festival. This is also a major blow to brands that invest more in marketing, including Burberry.

By the end of December last year, Burberry sales increased by 1% to 719 million pounds compared with the same period, while the change in the exchange rate increased by 2%, while the same store sales increased by 3%. Burberry emphasized that full price sales have led to growth, but the promotion in Hongkong partly offset the increase.

By region, driven by a 15% increase in sales in the mainland of China, the Asia Pacific region has a low single digit growth and sales in Hongkong, China, have dropped by 50%. In the past, the Hongkong market contributed 8% of the company's sales. The EMEIA region of Europe, the Middle East, India and Africa grew with the support of tourist consumption. The steady growth in the Americas and low single digit growth in the US market are partly offset by the Canadian market.

Clothing products continued to grow by category, while accessories benefited from more abundant leather products. The new products continue to perform well, accounting for about 75% of the retail stores, compared with 50% at the end of the first quarter.

As of December 28, 2019, Burberry has 225 retail outlets, 153 counters, 53 outlets and 44 franchise stores worldwide.

After issuing its earnings report, Burberry decided to withdraw its forecast for growth in the 2020 fiscal year ending March this year, and said that the impact of the epidemic on sales has exceeded the impact of Hongkong's retail downturn. The momentum of overseas travel by Chinese consumers will also weaken. Morgan Stanley expects sales of Chinese consumers will decrease by 50% to 60% in the next two months due to the impact of the epidemic.

When it is necessary to show the market that it is expected to significantly speed up sales growth and expand profits, Burberry is at an unfavorable external background. Royal Bank of Canada analysts have said earlier that although Burberry has made good progress in revitalizing its brand, it is not clear whether these improvements are enough to help them regain the market share of the major participants in luxury goods.

However, the retail environment in the UK has been retreated, and the growth of Burberry can only take place in other markets around the world. According to the British guardian, the British commercial street reduced more than 140 thousand jobs in 2019. The closure of stores and the bankruptcy of retail businesses made it one of the most difficult years in the past ten years in 2019. The British Retail Research Center predicts that unless the government intervenes, the situation will deteriorate in 2020, and the high business tax rate is one of the factors that will accelerate the closure of chain stores.

Up to now, Burberry has not commented on Shanghai's cancellation of its show.