Burberry Group plc (BRBY · LSE)
Back In Fashion
The 170-year-old British luxury house behind the trench coat and the check scarf, rebuilding itself around the products it is famous for.
Bull case for Burberry Group plc
Trench coats and scarves buyers already associate with Burberry
Owning two categories outright gives Burberry a product story rivals cannot easily copy.
Own shops and website capture most sales
Selling direct means Burberry keeps the full price and controls how customers experience the brand.
Cost cuts widen the profit per pound of sales
A permanently smaller cost base means each extra pound of sales drops through to profit.
Bear case for Burberry Group plc
Tourist shopping can vanish without warning
Conflict or travel disruption can empty flagship stores in Europe with no notice.
Heavy dependence on Chinese shoppers
A large share of sales rests on one country's consumer confidence and travel habits.
Turnarounds in luxury take years and can stall
Brand recovery depends on taste, so progress can reverse before the profit target arrives.