Burberry burned £28.6M of unsold stock to protect the brand — the brand took the damage

In July 2018 Burberry's annual report disclosed a figure the luxury industry had long kept quiet: the company had destroyed £28.6 million of unsold clothing, accessories and perfume in the previous year, to prevent the goods from reaching discount channels and diluting the brand. Over five years the total exceeded £90 million. The practice was not unique to Burberry — Richemont, LVMH and others did the same — but Burberry was the first to publish the number.

The backlash was immediate. Environmental groups, fashion commentators and the British public reacted with a mixture of outrage and disbelief at the waste. The irony was structural: the incineration was meant to protect the brand's exclusivity, but the disclosure did more damage to Burberry's reputation than any outlet sale could have. The brand that burned goods to look premium ended up looking wasteful and out of touch.

In September 2018, new CEO Marco Gobbetti announced Burberry would stop destroying unsaleable products and would instead donate, repair or recycle them. The reversal came within two months of the disclosure. The industry-wide practice did not end — but the assumption that it could be quietly reported in an annual report without consequence did.