Hermes has posted a sales increase of close to 22% for the first half of the year, but it’s not confident it can replicate the results in the coming months due to low handbag stocks.
Revenue was up 21.5% thanks to strong sales of jewelry, silk scarves, and watches. However limited handbag stocks should see it only growing by around 12 to 14% by year’s end.
Demand is so high for Birkin and Kelly bags that Hermes has hired almost 400 new employees. It also plans to open around 10 new stores by year’s end. However Hermes chief executive Patrick Thomas admits that it “can only make so many bags,” despite plans to increase handbag production by up to 9% in coming years.
It must be tempting for Hermes to pump out as many handbags as possible, but let’s remember that exclusivity has always been the name of the game. By keeping production numbers low and ensuring long waiting lists, we want those Hermes bags just a little bit more.
And let’s remember that the most recent sales increase saw Hermes raking in €1.31 billion, which is equivalent to around $1.89 billionUS. With figures like that, something tells me the company doesn’t need to change a thing!
[Source: The Wall Street Journal]
