Mulberry Group is calling on policy makers to reinstate tax-free shopping in the U.K. as a strategy to counteract the current challenging economic environment and its impact on consumer sentiment. The luxury brand recently reported a widened pretax loss due to increased investments, but highlighted the importance of reinstating VAT-free shopping to stimulate business growth across various sectors.
The Urgent Need
Chief Executive Thierry Andretta strongly believes that reintroducing VAT-free shopping in the UK would be a highly effective measure to drive business growth in the country. The absence of such a provision is posing significant challenges not only for luxury players, but also for the hospitality, travel, and tourism industries.
Financial Performance
Mulberry Group experienced a pretax loss of £12.8 million ($16.2 million) for the half year ended Sept. 30, compared to a loss of £3.8 million during the same period the previous year. This loss can be primarily attributed to increased investments and costs associated with supporting business expansion, including operational expenses for new stores in Sweden and Australia. Despite these challenges, revenue rose to £69.7 million from £64.9 million, demonstrating the brand’s resilience and commitment to long-term success.
Looking Ahead
Despite the challenging macroeconomic conditions affecting the entire luxury landscape, Mulberry Group remains determined to invest in its future growth. By advocating for the reinstatement of tax-free shopping and making strategic investments, the brand aims to overcome the obstacles presented by the current economic backdrop and ensure a thriving business for years to come.
