In a farming conference last year, one researcher made a strong case: the world’s food problem is not necessarily lack of food production but the economics of food. He went on to explain how some extremely rich countries throw away food into oceans just to ensure prices do not fall below some levels.
There is a policy element to it: if you do not buy-out excess capacity and waste them, you may be forced to pay farmers compensations if they sell below “certain” prices due to overcapacity. Yes, it is far cheaper to spend say $200 million to buy the food and waste them to keep price within threshold instead of spending $1 billion on compensations. Devilishly, that becomes a policy which must be pursued in a world where many are dying of starvation.
So, when I read that Burberry, the fashionista brand, wasted unsold clothes, perfumes, etc worth $37 million by burning them, I went speechless. Check, the CEO of that company is preaching the sermon of business: we do well to society through our products and services. Apparently, burning excess capacity instead of donating them will not be service since it would possibly “dilute the brand”.
The fashion brand Burberry is to stop burning its unsold goods, following an environmentalist backlash to the news that it destroyed unsold clothes, accessories and perfume to the tune of $37 million last year (Fortune Newsletter)
British luxury goods maker Burberry has announced that it will stop the practice of burning unsold goods, with immediate effect. The fashion label also said it would stop using real fur in its products, and would phase out existing fur items. In July, an earnings report revealed that Burberry destroyed unsold clothes, accessories and perfume worth £28.6m in 2017 to protect its brand.(BBC)