Burberry Group plc (London Stock Exchange :BRBY) is the UK's number one luxury retailer by revenue. The firm designs, sources, manufactures and distributes luxury mens, womens and childrenswear and non-apparel accessories globally through its own retail stores, concessions and wholesale customers. In fiscal 2010, BRBY reported net sales of £1.28 billion and net income of £81.4 million.
Despite harsh economic conditions in Europe, where Burberry receives nearly half of net sales annually, the firm continued to grow and prosper in fiscal 2010. The main driver for Burberry's success has been its restructuring of its global business plan, such as opening more stores in the Asia Pacific region. In addition to global restructuring, Burberry has focused on improving non-apparel (fashion accessories) sales to have a more balanced product line.
Burberry, based in the U.K., receives nearly 50% of annual revenues from European markets. Furthermore, Burberry is a luxury retailer whose profits are sensitive to consumer confidence levels. If a Europe-specific economic crisis, such as European debt contagion, occurs, then Burberry could suffer relative to its international competitors. To obtain a more diversified geographic presence, BRBY has opened stores in the Asia Pacific region -- the fastest growing luxury retail market in the world.
Burberry's apparel line, such as shirts, coats, and pants, has been the firm's core revenue producer since the firm's beginning. Although, the firm has focused on improving its non-apparel business -- items such as handbags, scarves, shoes, and jewelry. The key non-apparel product is the handbag, most of which are designed with Burberry's trademark flannel print, which composes 48% of non-apparel revenue. Burberry has continued to expand the non-apparel business in Tokyo -- the world's largest fashion accessories market.
Burberry competes against other retailers in the estimated £150 billion luxury goods market. Publicly-traded companies are listed below. BRBY also competes against privately-held luxury retailers such as Giorgio Armani, Prada and Gucci.