The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
PARIS, France — French luxury-handbag maker Hermès International SCA added to the industry's recent woes, saying sales growth this year may miss its medium-term target.
Revenue could rise by less than the company’s goal of 8 percent at constant exchange rates, Hermès said in a statement Wednesday, citing “economic, geopolitical and monetary uncertainties around the world.”
Recent earnings reports from the industry have been glum, with Richemont's Christmas season sales dropping for the first time in seven years and Swatch Group AG's 2015 profit missing estimates. One of the exceptions has been LVMH, whose fourth- quarter sales exceeded estimates on demand for Louis Vuitton bags in Japan and Europe.
Hermès also reported its slowest sales growth in six years as November’s Paris terrorist attacks led to a drop in tourist spending. Revenue climbed 7.2 percent on that basis.
By Thomas Mulier and Paul Jarvis; editors: Matthew Boyle and Paul Jarvis.
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This week, Prada and Miu Miu reported strong sales as LVMH slowed and Kering retreated sharply. In fashion’s so-called “quiet luxury” moment, consumers may care less about whether products have logos and more about what those logos stand for.
The luxury goods maker is seeking pricing harmonisation across the globe, and adjusts prices in different markets to ensure that the company is”fair to all [its] clients everywhere,” CEO Leena Nair said.
Hermes saw Chinese buyers snap up its luxury products as the Kelly bag maker showed its resilience amid a broader slowdown in demand for the sector.