Luxury Clothing Profits - Kungfu Outside Poetry

The so-called "Kung Fu is beyond poetry".

Clothing is a relatively special industry.

First of all, the fashion trend is much faster than other businesses, including regions, climate, fashion shows, publications, movies and so on will all affect consumers' tastes. Therefore, the garment industry that represents the fashion trend must follow the "fast turnover" industry characteristics, and shorten the lead time as much as possible. That is to say, shortening the time from the trend to the product is the core competitiveness of the garment enterprises.

Studies have shown that the average daily depreciation of clothing is 0.7%, and 10 days ahead of time, the depreciation is less than 7%, and the gross interest rate is increased by 13%.

Shortening lead time brings two advantages: first, fast reflection of the trend, no need to do a lot of stock in advance; secondly, it can reduce the risk of forecasting errors and reduce customers' popularity.

Secondly, clothing can attract a large number of potential customers.

Third, the operating cost of clothing is relatively high, even if it is a large group that can provide a common channel for many brands, because clothing stores are much larger than watches and jewellery, it is difficult for garment enterprises to obtain the cost reduction effect of shared channels.

Therefore, clothing oriented enterprises usually face relatively large financial pressure, and are prone to fluctuations in their performance, thus being acquired by other collectivization companies. In recent years, many independent clothing brands in Italy, such as Armani and Versace, have seen performance losses or debt problems in varying degrees.

Shanghai, a local high-end silk brand, was also bought in 2000.

Over the past 15 years, Bernard Anault has also brought Louis Vuitton to the world's first luxury brand in addition to generous checks, and sales increased from $950 million at the end of 80s to more than $4 billion, which is more than the two brands of Gucci and Prada combined. The operating profit is 2.5 times the sum of Gucci and Prada.

Many luxury brands are losing money, mainly by accessories, cosmetics, perfume and other product lines. This is already a well-known fact.

However, cosmetics and perfume are far less profitable than most people think. Jewelry and clocks also play a more and more important role.

LVMH's results show that in the group, the lowest time watch and jewellery business department has set a bottom position in terms of revenue, business profits and brand grades. However, its operating profit level is only two behind drinks, clothing and leather goods, and it also has a significant improvement.

This is Arnold's intention to buy Bvlgari.

In March 7, 2011, LVMH sold 3 billion 700 million euros for Italy's high-end watch and jeweler Bvlgari (Bvlgari).

LVMH will issue 16 million 500 thousand shares in exchange for its 152 million 500 thousand shares of Bvlgari shares held by the family, thereby buying 50.4% of the latter's shares, and Bvlgari will get 1 billion 900 million euros worth of LVMH shares accordingly. Thereafter, LVMH will buy Bvlgari's remaining shares at 12.25 euros per share.

The dust has settled, and has been sitting on LV, Fendi, Guerlain perfume, Hennessy (Hennessy) and more than 60 brands of Arnott luxury family to add a "Pearl" in Italy.

In the past 20 years, Arnott has succeeded in pushing LVMH to the "first power" of luxury goods in the world with a market value of over 53 billion euros, an annual sale of 20 billion euros and a net profit of over 3 billion euros through continuous acquisitions.

On the day of signing the contract, Bvlgari's market value was 2 billion 300 million euros. According to the purchase price, the premium paid by LVMH was as high as 60%, equivalent to 27 times of Bvlgari EBITDA (profit before interest tax depreciation and amortization), 40 times of EBIT (pre tax profit), two times of LVMH's own p / E ratio.

When it acquired heuya in 1999, LVMH paid a premium of less than 10%.

In addition to 8.5 times the sales volume of the latter when the Fendi was bought, LVMH had never had such favorable conditions.

Today's LVMH not only dominates its peers in terms of market value, income and net profit, but also is the most comprehensive group of business, covering almost all major sub sectors, such as liquor, leather goods, clothing, perfume, cosmetics, watches, jewellery, retail and so on. It is the only group of three luxury extravagant products that walks on two legs. The two categories of drinks, clothing and leather goods contribute 50% of the group's revenue and 80% of its operating profit, and have three trump cards including LV, DonPerignon and Hennessy.

By contrast, 80% of the revenue from the peak group is from the watch and jewellery business. The core brand is Cartire, while PPR's luxury business Gucci group relies entirely on the Gucci brand (66%).

In addition, China has

Therefore, in recent years, the trend of luxury goods industry is that capital and brand are concentrating on large groups, and profits are also concentrated on jewelry, perfume, watches and so on.

Although Louis Vuitton has also launched clothing lines in recent years, the most popular product is traditional leather products.

The LV head office of Champs Elysees street in Paris should be the most complete collection of luggage and suitcases in all the exclusive stores, where there are always a group of Asians who are "pilgrims" who are full of pious expressions.

Many people say that they are not only limited to the number of bags they buy there (but only one or two), and the clerk will take down the passport number and the credit card number, and they will not be able to buy them in half a year.

All this sounds even crazy. The original origin was just a luggage strapping worker.

After more than 100 years of development, Louis Vuitton has gradually developed into one of the most famous high-end leather goods brands in the world.

By the end of the 1980s, the LVMH group, with Louis Vuitton as its main body, was established.

Under the guidance of Bernard Anault, the LVMH group has acquired many brands and has grown into the number one brand in the world today.

In addition to Louis Vuitton, there are Givenchy, Kenzo, Celine, Donna Karen, Berluti and so on. The watches and jewelry have TagHeuer, Chaumet and so on. Perfume and cosmetics have Guerlain, Chaumet, and so on. Besides, there are also the world's largest retail channels for perfume and cosmetics, including chain stores, supermarket chains and chain stores.