Dior supplier in Italy under fire for labour exploitation

[CrackBerryCream]

Surprised no one has posted this yet:

https://www.reuters.com/business/retail-consumer/dior-unit-put-under-court-administration-italy-over-labour-exploitation-2024-06-10/

I'm not truly surprised about the practice itself, read about it in Dana Thomas' book "Deluxe - How luxury lost its luster" many years ago.

What baffled me was the cited bag manufactured for 53EUR and sold for 2,600EUR. I knew luxury margins were high, but THAT high? Just wow...

"[...] This allowed contractors to rein in costs and charge Dior as little as 53 euros to supply a handbag, the document said, citing as an example a Dior model coded PO312YKY, which the fashion house then retailed in shops at 2,600 euros."

Any guesses which model it is? A friend thinks it's the Book Tote as it could be fully machine-made and all fabric.

A quick search on the Dior site only shows reference numbers beginning with M, nothing with PO.

 

[joleen_loves_luxurybags]

I’m more shocked about the working conditions. These poor employees, Dior should be ashamed. For the grand prieces their goods go for they should spend some on the well-being of their employees! That’s the least that should be expected. Bare minimum.

 

[CrackBerryCream]

I’m more shocked about the working conditions. These poor employees, Dior should be ashamed. For the grand prieces their goods go for they should spend some on the well-being of their employees! That’s the least that should be expected. Bare minimum.

It's not Dior employees, but workers (incl. a few illegal workers) of their subcontractors. Doesn't make it less bad.

Dior chose to do business with a supplier that can provide a bag for 53EUR cost...

 

[Christofle]

It's not Dior employees, but workers (incl. a few illegal workers) of their subcontractors. Doesn't make it less bad.

Dior chose to do business with a supplier that can provide a bag for 53EUR cost...

There’s a reason Mr. Arnault is rolling in the dough and it isn’t by providing good value. 🤣

 

[benjinito]

It's not Dior employees, but workers (incl. a few illegal workers) of their subcontractors. Doesn't make it less bad.

Dior chose to do business with a supplier that can provide a bag for 53EUR cost...

100%. Dior can’t claim ignorance if they went with the cheapest option possible to produce their handbags

 

[SDC2003]

Probably a small leather bag like slg size or book tote. If I’m doing the math correctly that’s 98% profit? That’s just Dior. The Italians are also investigating a dozen other companies. How many more will be Lvmh companies? Kind of shocking that this happened. When you hear made in Italy by Dior you think of an older Italian worker laboring and hand stitching the items with tender loving care while working fair labor standard hours and getting paid vacations and other benefits. You don’t expect illegals huddling in substandard factory conditions working night and day. That’s what you expect from fast fashion which I refuse to buy it. They regularly exploit workers. This is pretty abhorrent and disgusting but maybe not shocking. Luxury isn’t what it used to be. Ever since these companies turned them public and beholden to shareholders it’s about profit profit profit. And when there’s really high demand and pressure to churn out products or a luxury downturn it’s not surprising that companies want to take shortcuts or look the other way. Given the lost trust with quality and standards I doubt I’ll ever buy from Lvmh again. Makes you wonder also about kering, Chanel etc

 

[averagejoe]

Makes you wonder also about kering, Chanel etc

💯

I'm assuming they all do this. Lots of smoke and mirrors in the luxury industry.

No wonder Hermes resisted an LVMH takeover.

 

[880]

This is so sad. I was reading an article about how the Chinese workers started to flock to Prato in large numbers. One main cause was that the smaller Italian manufacturers realized they had to reduce their labor costs or go out of business.

 

[A bottle of Red]

Just because Dior is using a subcontractor, doesn't mean they don't have an obligation to make sure the workers are well paid and taken care of.
A video I saw said that the safety features were removed from the machines in order to increase productivity. That's really horrific.
Not to mention how little they were paid and had to be there 24 hours a day.
It really makes me feel sad and sick.

 

[dnawawa]

These news really sadden me. I love designer items, I want to call them designer items and not luxury items, because I love to get unique pieces or pieces that have a connection with the heritage of the brand with how their founders designed and materialized beautiful creations. I love Dior, but I can’t bring myself to buy any other bag from them now. I think these conglomerates are killing art, as someone mentioned here before, now everything is about profit and keeping investors happy.

 

[joleen_loves_luxurybags]

Just because Dior is using a subcontractor, doesn't mean they don't have an obligation to make sure the workers are well paid and taken care of.
A video I saw said that the safety features were removed from the machines in order to increase productivity. That's really horrific.
Not to mention how little they were paid and had to be there 24 hours a day.
It really makes me feel sad and sick.

Absolutely! Couldn’t agree more with everything you said. That we are being “ripped off” with high margins is a known fact, we justify it with quality and how the bags are made, trained artisans, the fantasy that all the bags we buy are made by happy italians or french under fair conditions. It’s a disgrace.

 

[SDC2003]

For me the trust has been totally broken with Lvmh. I also want to know how much the Italian subsidiaries that do abide by fair labor standards charge. Is it typically double? Even double or triple - those margins are enormous. How much are these laborers making? Possibly not enough? Talk about some serious greed.

 

[MissMochaFrap]

Was personally devastated to learn of this, but unfortunately not surprised. I had become to question the overall quality of newer Dior goods within the last year (specifically while viewing a D-Joy Micro Lady Dior in the boutique, where I found quite a bit of loose threads in the inner pocket + visible cheap, tarnished springs in the clasps), but couldn't find it in myself to think otherwise - especially when CD has those beautifully curated reels on their IG showcasing the "workmanship" of their products. Honestly very unfortunate for them, and yet another reason to shop vintage IMO.

 

[meowdog]

I'm so glad I shorted all LVMH stocks a year ago.

 

[Seaquin]

Dior bags itself holds if not the Worst resale value of all time and to know some of these bags cost $60 to make truly devalues the item.
Poor conditions and exploitations make it a lot worst!

The revelation of the markup, I won't be shopping at Dior further and buying jewellery is better.
At least you know your piece didn't cost below $100 to make l!