By
Bloomberg
Published
November 19, 2024
Mulberry Group Plc is aiming to sell most of its luxury handbags for less than £1,095 ($1,383) to broaden the struggling brand’s appeal and boost sales, according to the new chief executive officer.
The British company’s flagship product, the Bayswater bag, sells for that price, and Andrea Baldo is trying to bring down the cost of its other products so that 60% of the range retails for less than the Bayswater.
“We were asking the customer for a little bit too much,” he said in a phone call with Bloomberg News. “In reality, we are becoming a kind of value for market in the luxury space.”
Baldo, who took charge in September, is trying to turn the company around by targeting customers looking for more affordable luxury goods amid a downturn in demand suffered by other fashion houses. Earlier Tuesday, the company said its pretax loss widened to GBP15.7 million ($19.9 million) in the 26 weeks to Sep. 28. The Asia Pacific region saw the greatest decline in retail sales of 31%, owing to a downturn in China, a key market for high-end goods.
Mulberry’s struggles have prompted it to announce plans to cut about 85 corporate roles, including in its commercial, product and finance divisions.
Last month, the company rejected a takeover bid by billionaire Mike Ashley’s Frasers Group Plc, which holds a 37% stake, according to data compiled by Bloomberg. At the time, Frasers criticized Mulberry’s board for failing to provide a clear commercial plan, while engaging only with Challice, its majority shareholder, on financing options.
Shares in Mulberry have fallen by a third this year.
Baldo previously served as CEO of the Danish clothing brand Ganni, which became a cult favorite of young shoppers in the 2010s. In his more than five years in charge of Ganni, he oversaw a major international expansion of the brand.