Burberry is planning to expand its footwear business rapidly next year as the group struggles against a decline in sales at its retail outlets. The company blamed a weak trading environment and a lack of high-spending US tourists for poor sales but admitted that its link to the "chav" trend had not helped.

Shares fell 121/4p to 4051/2p as analysts said that retail and wholesale sales were slightly lower than anticipated. However, a 14 per cent rise in sales of perfume and other licensed merchandise in the third quarter helped to lift total sales to in line with expectations.

Burberry wants to increase wholesale sales next year by building its footwear range, which is sold mainly through the brand's stores, into a business worth about a quarter of total sales for accessories. The company will launch new ranges of footwear in spring 2006. The company reported a 6 per cent rise in total sales, excluding the impact of currency changes, and said that it expected to meet analysts' profit forecasts for the year.