Burberry plans to invest at least £50m(€70.5m,$77.1m) in setting up a new factory to produce its trademark trench coats in Yorkshire, Leeds. Construction of the unit will start next year and once finished will create 200 jobs.
It will consolidate operations that are currently ongoing in Burberry's Castleford and Keighley facilities where one is involved in the production of coats while the other makes gabardine, the cloth that is used for making the coats. With the new facility, the entire process of making the trench coat will come under one roof. The current staff of 800 will move to the Yorkshire facility by 2018, giving the company the potential to triple its UK production to 15,000 coats a week.
Chancellor George Osborne, welcoming the move, said this was "a massive vote of confidence in our plans to build a 'northern powerhouse'." The Northern Powerhouse is a proposal aimed at uplifting economic growth in the north of England, particularly in the cities of Liverpool, Manchester, Leeds and Sheffield.
Burberry's CEO Christopher Bailey, in the context of continuing to manufacture trench coats in Britain, said he was a big believer in British manufacturing and the artisan skills and workmanship which were important to Burberry as the label tried to compete on the world stage. The factory, called Project Artisan, comes at a time when Burberry is making significant changes such as merging its catwalk brand Burberry Prorsum with the London and Brit lines under the simple Burberry label from next summer and focusing more on selling via its own stores rather than wholesaling, Bailey said. "It will be simpler and more intuitive for our customers and more productive and efficient for our business," he added.
Other companies that have expanded operations or opened offices in the north of England in recent times include Manchester-based Zeus Capital, small-cap broker Cenkos, private equity firm Northedge and Atom, a mobile-first challenger bank.