February 28, 2024

Brighton Journal

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Burberry joins the exodus of luxury brands from Russia | burberry group

Burberry has become the latest luxury brand to temporarily close its stores in Russia after Moscow’s invasion of neighboring Ukraine, following similar moves in recent days by Louis Vuitton, Hermès, Kring, Chanel and Prada.

The British fashion brand has three stores in the country, one of which is run by the franchisor and the other on the famous Red Square in Moscow. It had already announced last week that it was halting deliveries to the outlets, but confirmed this weekend that it would be closing them for now.

Its decision to halt shipments to the country “due to operational challenges” had already led to the shutdown of its online operations across the country. The Russian Burberry site was still up and running as of Sunday evening, although international orders will likely be further disrupted by Visa and Mastercard. Withdrawal decision The state, resulting in the banning of the majority of foreign transactions.

Luxury brands have been exempted from the latest round of EU sanctions, meaning France and Italy can continue to export luxury goods to Russia without any legal repercussions.

However, doing business and fulfilling orders in the region is becoming increasingly difficult amid restrictions on payments and transactions.

On Friday, LVMH Moët Hennessy Louis Vuitton, owner of brands including Christian Dior, Givenchy and Bulgari, said it would close its 124 stores in Russia from Sunday, while Kering, who owns Gucci and Saint Laurent, confirmed it would close two stores in Russia . country.

“Due to our growing concerns about the current situation, the increasing uncertainty and complexity of the business, Chanel has decided to temporarily stop its business in Russia,” Chanel wrote on LinkedIn.

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Prada confirmed on Saturday that she would follow suit, saying: “Our primary concern is that all colleagues and their families are affected by the tragedy in UkraineWe will continue to support them.”

Giorgio Armani Address the war directly On the catwalk, with last week’s Milan fashion show held in silence in solidarity with Ukraine. However, the company has yet to confirm whether it has closed or ceased operations within Russia in line with some of its competitors.

The increased operational and reputational risks of trading in the Russian market, as well as the risk of widening sanctions, have weighed heavily on stocks across the luxury segment.

Burberry shares have fallen more than 20% since February 23, the day before Russia officially invaded Ukraine. Its share price fell from 20.63 pounds to 16.41 pounds.

Shares in LVMH have shed about 13% of their value over the same period, dropping from €6.65 (£5.50) to €5.77.