Chanel, the second-largest luxury brand by revenues, joined LVMH and Burberry in warning of a tougher 2024 as the sector fights slowing growth.
In Perspective: The luxury sector is still making hefty profits, just not quite as outsized as they were in previous years.
FINANCE
Pepco (UK) reported full year sales rose 17.7% to a record £4.8 billion ($6.1 billion). However, profits fell 35.8% to £126 million ($160 million) for the 12 months to the end of September. The retailer was hit by the high cost of opening 668 new stores, as well as higher interest rates. Group sales are down 3.1% for the 8 weeks to November 26.
Inditex (Spain) reported Q3 sales rose 6.6% to $9.64 billion. Net income rose 32.5% to $4.5 billion. Sales for the nine months through October grew 11% to $28 billion.
H&M (Sweden) reported Q4 sales fell 4% to 5.6 billion euros ($6.1 billion).
Costco (USA) reported Q3 sales rose 6.1% to $56.72 billion. Net income rose 17% to $2.2 billion. The number of paid household members rose 7.6% year-over-year, with membership revenue up 8.2% to $1.08 billion.
Reitmans (Canada) reported Q3 net revenues fell 6.2% to $193.4 million. The retailer said it was hit with lower average transaction values and higher promotional activity. EBITA for the quarter was halved to $9.5 million.
MARKET INSIGHTS
Temu and Shein Square Off in Global Markets
Shein soared into the spotlight on its massive valuation (now estimated at $80-90 billion). However it is facing formidable competition from China’s Temu, which has also taken the market by storm.
In the face of an increasingly competitive e-commerce market, each player will need more than rock bottom prices to thrive. Read more
PODCAST
Creating A New Mindset to Win the Day!
Sometimes just when everything seems to be stable, we get blindsided.
We can’t control some of the challenges that life throws at us, but we can control how we react to them.
In the podcast we are joined by Sharon Hunter, founder of Dream Hunter, one of Disney’s leading tour organizers. When the pandemic laid waste to her once thriving travel agency she needed to take charge of both her business and her mindset.
In this episode, Sharon shares how she turned a crisis into an opportunity to develop a stronger, more confident and centered mindset, that not only got her through the pandemic years – but has become the foundation on which she’s built a new business platform.
RETAIL
In the UK, retailers could offer Boxing Day deals that are more attractive then the less-than-generous Black Friday discounts, per The Times.
US retail spending in November was up 0.3% from October, per Census Bureau data. Americans may feel that the economy is in a recession according to surveys, but according to sales receipts, consumers are continuing to spend on restaurants, apparel and e-commerce, the data showed.
Uniqlo (Japan) is planning to open 20 new stores in North America in 2024.
Etsy (USA) is laying off 11% of its staff in a bid to cut costs as it grapples with ‘very challenging’ economic headwinds.
WHAT’S TRENDING
Chunky necklaces and broaches, featuring crystals and rhinestones, have become a must-have trend – seen on top international catwalks including Louis Vuitton, Channel, Hermes, Miu Miu and others. Download the trend
MARKETS
The European Central Bank has left interest rates unchanged at 4% and gave few indications of when it might start to cut borrowing costs, despite saying it expects to hit its inflation target by 2025.
US inflation edged down to 3.1% in November, bolstering the resolve of Federal Reserve officials to hold interest rates at current levels through the spring.
The Bank of England warned that it does not intend to cut interest rates soon, but investors are forecasting that UK borrowing costs will drop to 4% by the end of next year, per The Times.
YOU MIGHT HAVE MISSED THESE ARTICLES
- Pakistan: A Vertical Supply Chain Backed By Product R&D
- Can’t Touch That! Retailers Face Rising Violence
- Mills Pressured to Find New Customers
- SE Asian Markets: Growing Fast, Spending More
- Why Consumers are Giving Canada Goose the Cold Shoulder
- Why Fortune Might Be Favoring Mainstream Brands
- Supermarkets Seize the Fashion Market
- Why Mango is Beating Other Fast Fashion Brands
- A New Toolkit for Winning in a Tough Retail Market
