Hermes CEO Responded To The Use Of Animal Fur: This Is A Public Health Problem.

The efforts of PETA, a 20 year old animal friendly organization, has been improving. When 90% of the top luxury brands have declared the use of animal fur off, Hermes has been pushed to the corner.

At the annual shareholder meeting held by French luxury brand Hermes on Tuesday, investors again questioned the morality of the brand to get the alligator skin.

In this regard, Axel Dumas said the brand's suppliers and farms had more strict guidelines for crocodiles than local regulations, so every farm could respect the health of animals. The brand would supervise the suppliers and farms in person every month, "this is part of the Hermes culture."

He does not think that the use of animal fur is a brand of Hermes, but a public health problem.

When Gucci, CHANEL and Prada announced that they no longer use animal fur, Axel Dumas emphasized that the brand is fundamentally attached to animal skins and the quality of leather is very important. He found that the quality of the cortex of some farms declined after industrialization, and the future brands will try to find new materials that meet the Hermes standards.

Axel Dumas also revealed that after the British female singer Jane Birkin asked to rename the platinum bag because of the cruelty of obtaining the alligator skin, Hermes has further improved the standard of its partners' best treatment and treatment for crocodiles, and will also invest directly in tanneries or farms to ensure that the whole production process is ethical and follows the international conventions of the United Nations and the protection of endangered species.

Some people in the industry say that the response of Axel Dumas may mean that Hermes is finally on the alert, but PETA will not be satisfied with it and will continue to take action.

In 2012, members of the PETA wore clothes and masks and walked on the streets calling on Hermes to stop selling fur products made from animal fur. At one point, they bought the shares of Hermes and prevented them from using rare animal skins as raw materials.

In 2015, Hermes was trapped in the killing of crocodiles. PETA accused two crocodile skin suppliers in Dezhou and Zimbabwe who killed the crocodile and released a secret video of the farm. A crocodile cut throat in front of the same class was widely debated in the Hermes crocodile skin supplier's farm.

In 2016, a white Himalaya alligator platinum package of Hermes was shot at nearly 3 million Hong Kong dollars in Hongkong Christie's, but the flawless leather was cut off from the crocodile.

Influenced by a series of videos and reports, the image of Hermes platinum handbag in the minds of consumers has been greatly reduced, and its popularity has slowed down.

It is noteworthy that PETA is one of Hermes's shareholders.

The organization will not only publicize the cruelty of the process of getting fur from animals in the streets with behavioral art and posters, but will also become shareholders of luxury goods giants such as Hermes and LVMH by buying a few stocks, so as to get direct dialogue with senior managers and pressure from inside.

In May 2017, the representative of PETA first communicated with Axel Dumas directly at the annual general meeting. She asked Hermes to stop using ostrich skin and other rare animal fur. Axel Dumas responded that it would continue to use relevant materials on the premise of ensuring compliance with ethical requirements and international regulations.

In the same year, PETA representatives were refused to participate in LVMH's shareholders' meeting.

However, like Hermes, LVMH has begun to strictly control the source of rare animals' skins. In 2011, it acquired Singapore's Hang Lung Group, one of the world's largest crocodile leather manufactory, and tried to ensure compliance with ethical standards from production to sales.

Bruno Pavlovsky, President of CHANEL, also pointed out in earlier interviews with the US media that it is becoming more and more difficult to purchase fur that meets the requirements of brand quality and moral standards. Therefore, the brand will focus on developing textile and leather materials in the future.

At present, Armani, Calvin Klein, Ralph Lauren, Tommy Hilfiger, Versace, Michael Kors and Coach and other brands have joined the international zero fur Alliance under the influence of the company.

To the industry's surprise, the Hermes, which has been questioned, has never had any plans to cut production or to stop selling animal fur. Instead, it has set up a leather workshop to meet the growing demand. At present, the brand has 52 production plants, of which more than 40 are located in France, and its production base in Guyenne and Montereau will also be completed in 2020. The brand also recently issued a statement that it plans to establish a new leather factory in Normandy and employs 250 workers.

In May 20th, Hermes was formally put into use in seventeenth handmade leather workshops located in Fitilieu Town, Is re re, France, and plans to employ about 100 craftsmen. The workshop also provided basic skills training courses for leather goods and saddle making, leather cutting, leather machinery and other basic skills for new craftsmen.

At the end of the training, the qualified manual artisans will be assigned to three leather workshops in Savoie area.

In fact, this is related to the serious dependence of Hermes on handbag products.

Unlike Gucci, CHANEL and other luxury brands, Hermes set up high-end harness and gradually extended to handbags, garments, scarves, accessories and perfume. The whole brand is permeated with noble aristocracy from the whole to the details. However, the platinum package, priced at 10 thousand and 500 pounds (100 thousand yuan) to 150 thousand pounds (about 1 million 450 thousand yuan), has always been located in the center of Pyramid, and is the representative of luxury brand attributes.

According to fashion headline data, Hermes's platinum bag made of rare animal leather accounts for about 15% of the group's handbag sales. It is the favorite of many celebrities, even to a difficult point.

The "purchase Bible" formed around the platinum package has become a part of the brand culture. The relationship and brand system established by the brand and consumers over the years are also the most valuable asset for the brand.

What it means is that in March 15th this year, Hermes formally denied that there was a rumor that the package should be allocated.

The direct effect caused by the increase in capacity is performance growth.

In the second quarter of fiscal year 2018, sales of hermes handbags and harness Department slowed to 3% in the second quarter of fiscal year, which was mainly short of demand. But in the third quarter and the fourth quarter after the increase, the sector's sales growth accelerated again and returned to 9%.

In the first quarter of this year, sales of hermes handbags and harness increased by 16.9% to 808 million euros, accounting for 50% of total revenue. Compared with the performance of the silk and textile sector, sales in the Department of silk and textiles continued to lag behind, with sales in the first quarter rising to 6% euros, to 140 million euros.

It is impossible for Hermes to not feel the sword of Damour and Chris hanging overhead.

At the same time, as consumers are increasingly concerned about the impact of luxury fashion on society and the environment, the use of animal fur has become a way for luxury brands to show their attitudes and enhance their image. Gucci, as the most popular luxury brand at present, its continuous deepening of the field of mobile protection is actually a further suppression of Hermes.

According to fashion business news, Hermes was first overtaken by Gucci in 2017, with annual sales less than 700 million euros, and in 2018, the distance was extended to 2 billion euros.

Axel Dumas stressed at the meeting that Hermes's goal is to become a comprehensive global luxury group, not just a handbag product, so the balanced development among departments is very important and helps to enhance the competitiveness of the brand itself.

In addition to the addition of leather workshops, Hermes is planning to further expand the size of its Pierre-B nite factory, increasing its production capacity and expanding its recruitment by 25%, aiming to emphasize the group's confidence in the future potential of the textile business.

At the same time, Hermes is still trying to develop new businesses and will launch large-scale cosmetic products next year.

Axel Dumas said that in order to ensure the quality of products, Hermes's beauty products will be produced in Italy and France, and will extend to the skin care field in the future.

In order to avoid conflicts of interest, Axel Dumas retired from the board of L'OREAL group in April.

Axel Dumas also mentioned the cooperation between luxury brands and China's third party e-commerce platform, such as Alibaba and Jingdong, and said that considering the high complexity of the Chinese market, Hermes will not rule out the possibility of cooperation with them.

Some analysts point out that for luxury goods based on scarcity, they need to be alert to the risk of dilution of brand value. After all, the definition of luxury goods has changed in the minds of young people.

According to the latest New York Times news, with the growth of the resale market and the emergence of new resale platforms, cheaper second-hand luxury goods have attracted many ordinary consumers. The luxury stores in Japan have greeted tourists from all over the world. The Hermes platinum packages that were once available for sale were no longer difficult to buy.

Luca Solca, a luxury analyst at Bernstein, says there are now more than 1 million platinum bags on the global market.

When sustainable fashion becomes a trend, the trend of the industry has changed.

Some analysts believe that Hermes has no choice. After all, sticking to rules is not an option in the luxury sector.