It’s not just China’s economy feeling the impact of Zero Covid – Burberry is also a victim.
The luxury fashion brand reported sales fell 35 percent in China in the first quarter due to ongoing Covid restrictions.
It is a key market for the company, with Chinese buyers representing about a third of the global luxury industry before the pandemic, both at home and as tourists abroad.
Excluding China, Burberry’s sales rose 16% in the quarter, with trade in Europe, the Middle East, India and Africa up 47% compared to the blockade-hit first quarter last year.
This is largely due to the recovery of US tourist sales in the region.
Overall, however, sales rose by just 1pc.
Jonathan Akeroyd, Chief Executive of Burberry, said:
Our performance in the quarter continued to be impacted by the lockdown in mainland China, but I was pleased to see our more localized approach lead to a recovery in EMEIA, where local customer spending was above pre-pandemic levels.
Our focus categories, leather goods and outerwear, continued to perform well outside mainland China and our brand activation program strengthened customer engagement.
While the current macroeconomic environment creates some near-term uncertainty, we are confident that we can build on our growth platform.
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