Some little known facts about Burberry and the Rhondda...

Usually, I don't use this blog to air my personal views on anything remotely political (or similar), but something has been rumbling on since the autumn of last year and I can't hold back any longer.  I, too, will rumble on here, but please bear with me, as I need to enlighten you on the relevant history...

Worldwide recognised, much chav copied (to their chagrin) and quintessentially British brand Burberry announced that they wanted to close their factory based in the Rhondda, in south Wales.  The factory produces their polo shirts. 

Burberry seeks to move production to China, following a review of their supply chain and considers the Rhondda factory to be no longer commercially viable.

The Rhondda factory provides some 300 jobs in an area that is not rich in work opportunities.  Indeed the opposite can be said.  This is an area that needs continued regeneration and needs work.  And that is where the problem starts...

To soften the impact of the closure and redundancy announcement, Burberry offered its Rhondda staff a scarf and £30 to spend on its products as a Christmas bonus.  (Not so great when unemployment in 2007 beckons...)

The AM (Welsh Assembly Member) Leighton Andrews and MP Chris Bryant for the area pounced into action.

Many public faces have lent their support to the campaign to halt the closure: Ioan Gruffudd; Emma Thompson; Tom Jones; Bryn Terfel; Alex Ferguson; Rhys Ifans; Tanni Grey-Thompson; Max Boyce.

The Church of England, which has invested in the company, has also written to Burberry asking about its proposals to close the factory.

The company has asserted its right to pursue what it determines is right in respect of profits.  This is true, it's a commercial company, but what a shambles and what a PR shambles for the company.  They really couldn't have picked a worse place to abandon in the pursuit of profits.  They have a known standard of production from a skilled task force, which has worked well for years, and yet they choose to go down the cheap route for the sake of profits and share price.

To add even more insult to injury, but obviously feeling that this offer might quell the horror, distaste and heart dropping disappointment of its employees, Burberry has now valued its factory at £1m and offered the factory to the local community.  No surprises that the offer has been criticised and that the campaign continues.

Burberry can do what it likes here, there's no legislation or compliance issue to prevent it.  But there's also such a thing as a bad decision for other reasons.  That leads to bad PR for the company and this is so in evidence.  Bad PR can also lead to loss of sales and hence profits.  Gerald Ratner once performed the proverbial "foot in mouth" disaster that led to the loss of a UK high street jewellery chain.  More recently, Jade Goody's TV verbal outpourings led to accusations of bullying and racism and for her, the pulling of a paperback of her biography, the shelving of her perfume, etc., etc..

For Burberry, the pursuit and preference of an eastern production source over continued support to the UK market and in a place that really needs the jobs, is a slight to behold.

Burberry says it will maintain its Yorkshire plant (trench coat production) and has offered Welsh workers jobs at that location.  But for how long?    When a company sees a cost reduction in transferring polo shirt production overseas, how long before the tailors of Hong Kong get a contract on the trench coats?

We live in a global world, yes.  Many of our services industries are now owned by foreign companies, alas.  Burberry and its identifiable check is a British brand.  An American was Chief executive of the company for years and turned the company into something bigger than it was.   But it's still British in the eyes of the beholder and consumer.

My message to the management of Burberry is this: keep it British from idea inception through to final product production and make that your USP (unique selling point).  Capitalise on the fact this brand is British!  And don't abandon those who have been a part of making it all happen up until now; those who really need the jobs you've provided to date.

If Burberry proves to be still hell bent on seeking cost savings overseas, (and I hope not), I'd also say to the community in the Rhondda: take their factory and make it work.  Let Tyrone O'Sullivan be your inspiration and guide.  And have you called on Merthyr born Julien MacDonald yet?  He remembers his roots and is in the same industry as yourselves.  Perhaps he'd like to transfer the production of some of his apparel to his home nation?

I sympathised when the Burberry check went chav-replicated ad infinitum in the UK.  But transferring production to the east only increases that risk.  But more to the point, 300+ workers in a disadvantaged area of Wales are fighting for their jobs and lives.  Yes, lives.  Those ensconced in plush London corporate head-quarters can't even begin to understand this unless they make the trip and see the landscape.

There's a campaign in full force and you can read more about it here and follow the work to eventual outcome. I hope that readers of this blog will follow that link.

But for now, Burberry is digging itself into a deep hole.  Deeper than the deepest mine the south Wales mines ever achieved, when in operation.  I'd much prefer it if they saw the light.  They still have a chance and some time.  I hope they find it.  Otherwise it's all black down there and that might mean red to Burberry in the longer term.

And when did loyalty to your respected and reliable employees become to mean so little?

All my very best to you in the Rhondda!  Who knows how this will turn out?  But I sincerely hope that all of you, who are fighting for your jobs, have the best possible outcome.   Your skills, workmanship and company loyalty should be recognised and put to full use.

Where Burberry proposes to abandon those in need of jobs, is there anyone else to appreciate the talents of this workforce and take up a solid baton?

Comments

[crimeficreader]

Thanks Clare. Unemployment in the valleys did get better, but Burberry's decision is a move that highlights just how tenuous employment is in this area.

[Clare]

This is so sad. A neighbour from that region said that there were generations of people in the valleys that had never known what it was to work. Unemployment has become a way of life and I just feel sorry for the people there. It is demoralising for everyone. An excellent post CFR.

[crimeficreader]

I don't think we can ever escape from the world economy, now it's arrived. So many British companies are now owned by foreign investors.
I think Burberry would have got away their plans (possibly) had the factory not been in Wales and in a place in Wales that needs jobs and regeneration.

[Maxine]

It is really sad, isn't it, Rhian? This is happening more and more, no more so than "customer service" departments of various companies. So one is so often reduced to talking to an Indian gentleman or lady who no doubt works for several other companies on a freelance (per call?) basis and has no clue of the problem you are having with the company's product (my recent experience with British telecom a case in point).
I appreciate the economic realities that force companies to outsource, and there is a lot about the history of the UK workforce that is nothing to be proud of, but even so, I am sure it is losing these companies a lot of money in the long run to outsource everything to the extent that the customer is totally cut off from the manufacturer (as here).
I presume some other brand will come in for the style-conscious, as these people will not only not wish to be associated with a Chav brand but also they will not wish to be part of a mass produced item either. For example I've noted now that a lot of "chains" eg Monsoon/Accessorise and Next are selling small ranges of "organic cotton" goods. If the customer votes with their wallet and purchases these kinds of product even if more expensive (marginally), then the likes of Burberry will have mass productoin by underpaid workforces, but nobody to sell to.
Dream on, maybe, but anyone who can afford to choose where they buy leisure items (eg Burberry, which is hardly a staple) will not go to a company that outsources and treats both its customers and its workforce with contempt.

[Norm alias Uriah Robinson]

I am very sorry about the Rhondda workers Rhian, but apparently loyalty and reliabilty are out of fashion, they are dinosaur-like qualities out of a bygone age.

A few weeks ago I saw Mexican Chimayas made in China, obviously the Mexican worker wanted a couple of dollars more a week than the Chinese!
Does globalisation just mean that the British worker is too expensive and no job is safe from Chinese, Indian, Polish,or Bulgarian workers? Unfortunately any attempt to solve the problem, either by tariffs, leaving the EU or immigration controls, would be classified by a large part of the electorate as reactionary, or worse.
I don't know the solution, but we face a very unpleasant future unless we find something soon.