Supply chain · 7 September 2018

Burning old stock: Would you follow in Burberry’s footsteps?

Many fashion brands burn old stock

Old stock is always a bone of contention with all companies, but what should you do with it?

In July, an earnings report revealed that Burberry destroyed unsold clothes, accessories and perfume worth £28.6m in 2017 to protect its brand. Fashion firms often destroy unwanted items to prevent them being stolen or sold cheaply.

This information led to an angry response from environmental campaigners, alongside the brand using real fur in their garments.

However, in recent news Burberry has halted the burning of old unsold stock in agreement with a new company.

Sustainable luxury company Elvis & Kresse secured a deal with Burberry which will see 120 tonnes of leather off-cuts transformed into new products over the next five years.

In addition to this Burberry has also said it will phase out using real fur products.

As the rise of ethical brands continues to increase, with the changing attitudes of consumers, it’s important for brands to up the anty and go greener.

Commenting on this, Burberry’s chief executive Marco Gobbetti said: “Modern luxury means being socially and environmentally responsible.

“This belief is core to us at Burberry and key to our long-term success. We are committed to applying the same creativity to all parts of Burberry as we do to our products.”

Carlsberg

Also this week, Danish brewer Carlsberg has pledged to replace plastic can holders with recyclable glue.

The leading beer brand will be phasing in a new “snap pack” which it claims will reduce the amount of plastic used in traditional multi-packs by as much as 76%.

Dr Sue Kinsey, senior pollution policy officer with the Marine Conservation Society, supports Carlsberg’s planned packaging change.

“They are a hazard to wildlife which can get entangled in them. Any steps taken to stop the flow of plastics to our oceans are to be welcomed,” she said.

Although consumers rate more ethical brands over wasteful. But its not always as easy to keep everyone happy whilst keeping costs and waste low.

However, for the average small business owner, it can be difficult to find a happy medium of keeping costs and waste at a minimum.

Tim Stevens, Operations & Logistics Manager at online retail company Find Me A Gift shares his knowledge on the issue.

“Purchasing see the value of the stock and don’t want to get rid of it, Warehousing want to get rid of it away they can as it takes up space.

“Sales only want new ranges and fast selling product and Operations have to try and find the middle ground to ensure the best value is gained with the least amount of disruption to the operation.

“The solutions can differ greatly based on the type of product, but we at Find Me A Gift do some or all of the following:

  1. Discounting and offers on our website to sell off end of range product.
  2. Sale or return options with suppliers – we have renegotiated some of our supplier contracts to include sale or return options. This has allowed us to get credit for unsold stock and limits the loss taking other routes.
  3. Work with local charities to gift stock. A good source for the PR Dept. but make sure you select the right partner that will represent your brand well.
  4. Staff giveaways – we have returned, end of range or damaged stock that can’t be sold stored in our Returns Dept. and twice a year we lay the stock out in the Warehouse and allow staff to come and pick what they want. Great for staff and they get to use our products plus makes staff feel part of the FMAG family.
  5. Renegotiated returns agreements with suppliers – we have managed our returns in such a way that the majority of faulty goods are credited by the supplier and if requested returned to them.

“As a result of all the actions above we dispose of very little stock. Only stock that has been returned faulty and hasn’t been sent back to a supplier is disposed of.

Further to all of this activity we are always looking for new ways to move stock through our business, new markets are emerging all the time and this can be another effective way to move old stock out of the business”.

 

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ABOUT THE EXPERT

Carly Hacon is a reporter for Business Advice. She has a BA in journalism from Kingston University, and has previously worked as a features editor for a local newspaper.

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