Burberry burned $36,500,000 of clothes in one year. Not because...
Hosun Chung@hosun_chung
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Feb 01, 2025
~4 min read
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Burberry burned $36,500,000 of clothes in one year.
Not because they couldn't sell them.
Because they didn't want YOU to have them.
The disturbing truth about luxury's dirtiest secret🧵
Not because they couldn't sell them.
Because they didn't want YOU to have them.
The disturbing truth about luxury's dirtiest secret🧵
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In 2018, a shocking line appeared in Burberry's annual report.
Most people missed it. But hidden in the financial statements was something disturbing:
The systematic destruction of £28.6M ($36.5M) of perfectly good merchandise.
And that was just the beginning...
Most people missed it. But hidden in the financial statements was something disturbing:
The systematic destruction of £28.6M ($36.5M) of perfectly good merchandise.
And that was just the beginning...
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Over 5 years, Burberry destroyed £90M ($118M) worth of products:
• Pristine trench coats: Burned
• Never-worn scarves: Incinerated
• Brand new perfumes: Destroyed
But here's the truly mind-blowing part:
• Pristine trench coats: Burned
• Never-worn scarves: Incinerated
• Brand new perfumes: Destroyed
But here's the truly mind-blowing part:
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This isn't just Burberry being wasteful.
It's a calculated strategy used across the luxury industry.
They use specialized waste disposal companies to destroy unsold goods...
Complete with strict security protocols and documentation.
The scale is staggering:
It's a calculated strategy used across the luxury industry.
They use specialized waste disposal companies to destroy unsold goods...
Complete with strict security protocols and documentation.
The scale is staggering:
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Richemont (Cartier's parent company) destroyed $563M worth of watches.
Other luxury giants regularly destroy excess inventory.
Major brands run routine "inventory cleanses."
But why would billion-dollar companies burn money like this?
Other luxury giants regularly destroy excess inventory.
Major brands run routine "inventory cleanses."
But why would billion-dollar companies burn money like this?
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The answer reveals the luxury industry's biggest lie:
These brands don't sell scarcity.
They MANUFACTURE it.
And they use 3 disturbing tactics to do it:
These brands don't sell scarcity.
They MANUFACTURE it.
And they use 3 disturbing tactics to do it:
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1. The Tax Loophole
Most people don't know this, but:
In the US, companies can claim back 99% of import taxes by destroying goods if customs officials supervise the destruction.
They make more money burning clothes than selling at discount...
Most people don't know this, but:
In the US, companies can claim back 99% of import taxes by destroying goods if customs officials supervise the destruction.
They make more money burning clothes than selling at discount...
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2. The Grey Market Prevention
Most luxury brands would rather destroy products than risk them entering the "grey market" (the unauthorized resale of authentic products).
This parallel market makes up 20-30% of luxury sales in some regions.
Brands are terrified of it because:
Most luxury brands would rather destroy products than risk them entering the "grey market" (the unauthorized resale of authentic products).
This parallel market makes up 20-30% of luxury sales in some regions.
Brands are terrified of it because:
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• Lower prices hurt their "premium" image
• Unauthorized sellers dodge their control
• It proves their artificial scarcity is... artificial
So instead of risking it?
They destroy everything.
Because controlling the supply means controlling the price.
• Unauthorized sellers dodge their control
• It proves their artificial scarcity is... artificial
So instead of risking it?
They destroy everything.
Because controlling the supply means controlling the price.
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3. The Exclusivity Illusion
If everyone could afford luxury goods, they wouldn't be luxury anymore.
So these brands artificially limit supply.
They'd rather burn millions than risk their products becoming... accessible.
The real cost?
If everyone could afford luxury goods, they wouldn't be luxury anymore.
So these brands artificially limit supply.
They'd rather burn millions than risk their products becoming... accessible.
The real cost?
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Something luxury brands may not consider:
• One cotton shirt wastes 2,700L of water
• Burning synthetics releases toxic gases
• These practices contribute significantly to industry waste
But something changed:
• One cotton shirt wastes 2,700L of water
• Burning synthetics releases toxic gases
• These practices contribute significantly to industry waste
But something changed:
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In 2018, Burberry's annual report revealed these practices.
The public was outraged.
But the really interesting part?
This disclosure exposed a massive shift in consumer psychology:
The public was outraged.
But the really interesting part?
This disclosure exposed a massive shift in consumer psychology:
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Today's consumers don't want artificial scarcity.
They're seeing through the smoke and mirrors.
Instead, they're flocking to something else entirely:
They're seeing through the smoke and mirrors.
Instead, they're flocking to something else entirely:
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Look at the brands doing things differently:
• Patagonia: Resells used clothes through "Worn Wear"
• Stella McCartney: Leading in sustainable practices
• Gucci: Investing in waste reduction
What do they have in common?
• Patagonia: Resells used clothes through "Worn Wear"
• Stella McCartney: Leading in sustainable practices
• Gucci: Investing in waste reduction
What do they have in common?
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One thing: Transparency.
The age of secrets is over.
Research shows modern consumers increasingly:
• Value authenticity
• Demand brand transparency
• Trust genuine content over ads
The luxury industry's biggest mistake?
The age of secrets is over.
Research shows modern consumers increasingly:
• Value authenticity
• Demand brand transparency
• Trust genuine content over ads
The luxury industry's biggest mistake?
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Thinking they could hide the truth forever. But transparency wins.
And that's the opportunity for founders:
While luxury brands burn millions to maintain fake exclusivity...
Today's founders are doing the opposite:
And that's the opportunity for founders:
While luxury brands burn millions to maintain fake exclusivity...
Today's founders are doing the opposite:
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Building in public. Sharing behind-the-scenes. Creating genuine connections.
They're creating authentic content about their journey — and evangelizing customers in the process.
The impact is clear...
They're creating authentic content about their journey — and evangelizing customers in the process.
The impact is clear...
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By being vulnerable and genuine online:
• Customers trust you before buying
• Word-of-mouth grows organically
• Marketing costs decrease
• Brand loyalty increases
Because authenticity is the new luxury. Ready to take advantage?
• Customers trust you before buying
• Word-of-mouth grows organically
• Marketing costs decrease
• Brand loyalty increases
Because authenticity is the new luxury. Ready to take advantage?
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In 2023, I was a banker in London when I found the opportunity of the decade: Personal Branding.
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In 2023, I was a banker in London when I found the opportunity of the decade: Personal Branding.
So, I dropped everything to build @ThoughtleadrX — a premium media agency designed to build personal and company brands.
Follow me for more content like this!
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• Generalists
• Crypto/Web3
Key requirements:
• Native English speaker
• Location: Must be based in Europe, UK, or Canada
• Time zones: Must align with US Eastern working hours
Want to work with our amazing portfolio of founders? Apply here: heathered-puma-5f6.notion.site/Creative-Direc…