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Hermès sings a different tune than the pessimistic song in the rest of the luxury sector: the brand saw its sales rise 11 %, a sharp contrast to decreases at powerhouses Kering and LVMH.
Slight growth in China
CEO Alexandre Dumas can be quite pleased with his company’s third quarter: Hermès is growing in tough times and is (almost?) the only luxury house to do so. Rival Gucci saw its sales fall 26 %, causing its parent company Kering to fear that its profits could halve. French luxury giant LVMH also saw its sales slump last quarter.
By contrast, Hermès sales rose 11 % to 3.7 billion euros. Although the maker of the Birkin bag was not spared the slowdown in the Chinese market, sales rose 1 % even there. The fashion house does not report profit figures in the quarterly update.
No limits on exclusivity
Hermès proves that there is no crisis for those who can afford a Kelly handbag worth more than 10,000 euros, especially if they have been on the waiting list for that coveted good for years. The crisis is mainly impacting the “aspirational” luxury market: consumers who occasionally afford a more expensive piece are the ones that are spending less now.
The French luxury group therefore feels emboldened to look for exclusive conquests: Hermès reportedly wants to acquire the watch division of the Sandoz Family Foundation, known for brands like Patek Philippe, Audemars Piguet and Tag Heuer.
