Burberry, maker of designer luxury clothing, is shutting down its sewing plant operation in Rotherham, New Yorkshire. The decision will result to cutting 290 jobs in UK.
By shuttering its operations plant located in Eastwood, Burberry will have to retrench 170 jobs in this plant. The plant in Eastwood makes the basic outwear for the Burberry brand.
The company’s UK plants in Castleford and Keighley, West Yorkshire will also cut 120 more jobs in the coming weeks.
Executives of Burberry said the company will concentrate its operations in the Castleford factory. The Castleford section makes the famous trenchcoats of Burberry.
More Disheartening Developments
Burberry closed its factory in Rhondda Valley, South Wales in 2006. 300 employees of Burberry in that factory lost their jobs.
The factory in Rotherham was acquired and managed by Burberry for less than 5 years. According to the GMB union regional officer, Tim Roache, the closure of the Rotherham plant signals a gloomy day for the region.
Tim Roache said that their organization will try to discuss the drastic job cuts and closures with Burberry. The union wants some explanation on the rationale behind the recent decisions of the company.
Roache said that the union raised some issues with Burberry in the past as the company tries to re-channel the jobs from UK to China. The union wants reassurance that such situation will not happen this time.
Employees Shocked, Dismayed
Shocked employees gathered outside the gates of the Burberry Eastwood plant disbelieving the news they heard.
A veteran employee at the Eastwood factory said that everyone was in a state of shock and very upset. Patricia Turner, an employee at the factory for 35 years, said that everyone at the plant did not know that there is a plan to shut them down.
Some employees showed utter disgust because they only knew about the decision of the company when they were stopped at the gates of the factory.
Sales Spiraling Downwards
Burberry executives said that sales in 2008 have been very dismal which led to the decision to shut down the factories. Burberry suffered a 3 percent sales loss in the last months of 2008 alone.
According to Burberry CEO Angela Ahrendts, the market for Burberry products and designer clothes remained very volatile and unpredictable. Sales of clothes were below the company’s expected levels.
Ahrendts said that the company experienced dismal performance for the entire year of 2008.
January 20, 2009
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