lvmh - luxury fashion market - china
During my Fashion Science education at Stockholm University I was thrilled to learn not just about fashion in terms of fashionhistory, fashionmedia, luxury fashion, creating image and branding or dresshistory, but sooo many courses was also about the global fashionmarket, economy within the fashionindustry and also about the aspects of nationality in fashion both contempory and historically. To add up to this, all those courses of ethnology keeps me on my toes especially in areas of customer behaviour within the luxury fashionindustry of today.
Of course I try, even though my BA was taken almost 2 years ago, to keep up with the constant changes at the global fashion market. Of course, I do try to keep you, my faithful readers, updated as well :)
I have read a lot of articles on-line these last few days about the reason for the recent fall of luxury fashion stocks. As I am still all into LVMH and Louis Vuitton ofc, this is my first priority . Apparently this drop is a result of how Chinese customs authorities are stepping up border checks on returning travelers, confirming speculation on social-media networks and deepening a selloff in luxury companies’ shares. LVMH Chief Fiancial Officer Jean-Jacques Guiony said: “The Chinese authorities have some laws that are being enforced with some more strength at times, which is what we’re seeing now”. Last weeks social media reports has reported that China is stepping up border checks in an effort to curb the flow of unauthorized imports of luxury fashiongood as from luxury fashionhouses as Louis Vuitton, Gucci and so on.(Apparently the Chinese market of this luxury fashion is about a third of the industry´s sales and a majority of its growth. I do seems akward that LVMH shares should drop, as for example the last quarterly report is increasing accordingly with analyst forecasts. Although the market is the market and national political decisions always affects shares somehow, shortterm at least)
You might not have knowledge about the word "Daigou Market"? Well, it is a parallell market or some even call it the gray market of imports. For example Chinese residents buy Louis Vuitton luxury products overseas, where prices are lower, then sell these goods with profit on their retur back home to China. This affects the nation fashion companies stores. LVMHs Guiony said about this that it "is not something that we welcome or that we try to promote.". He also add that there are company limits of number of items that customers can buy at the stores, as I know myself for a fact working at Louis Vuitton in Stockholm for such a long time. Guiny also stated that: Despite the risk of unauthorized arbitrage in LVMH’s goods, the company has no plans to equalize prices in China and abroad.
This is all about the subject for now!
Btw, are you interested in similiar articles about the luxury fashion market there is some long articles and even clips from fashion forums at this website (just search with key words) One of my favourite clip is from a forum held Oxford, starring the head of LVMH Bernard Arnault, and I choose to enclose it below once again. xoxo
Image of Fondation Louis Vuitton © Iwan Baan from www.lvmh.com