Got a Birkin Bag to Sell? That’s a Problem for Hermès

[QuelleFromage]

Another thing I want to note is that this "analyst" is not 100% transparent on their sources for these numbers and claims they are making, a big no no in proper journalism. I'm saying this because I studied quite a bit of journalism in school, now I'm no pro at it, but it is one of the basic fundamentals of journalism.

There is little proper analysis in luxury and so it's pretty easy to get quoted/rise to the top. I actually like BoF as a publication but have found Solca's claims to be either unsubstantiated or just wrong. To be fair, analysts don't need to cite sources as journalists do, but I still don't think he's credible.

 

[shrpthorn]

What gob-smacked me in this article was that Hermes stock has a P/E ratio of 41!

 

[Vln]

What I find upsetting is people who buy for the sole purpose of reselling. It decreases the number of bags available in store for true customers who love the product. I can understand someone selling a bag that she/he no longer needs or loves, but resellers who buy simply to turn a quick profit are the source of the problem. If Hermes could control that aspect, there would be no issue.

 

[psoucsd]

What I find upsetting is people who buy for the sole purpose of reselling. It decreases the number of bags available in store for true customers who love the product. I can understand someone selling a bag that she/he no longer needs or loves, but resellers who buy simply to turn a quick profit are the source of the problem. If Hermes could control that aspect, there would be no issue.

PREACH!

 

[caruava]

I know this is an old thread but somehow resellers do not irk me as much as the digital creators, influencers, video loggers, or whatever they call themselves... that claim not to resellers but their purchasing behaviour is just to keep up with producing 'content' for their channels. Many of whom are members here. I'm not talking about making a purchase and selling the item years down the track, I'm talking regular turnover of items in weeks/months.

They're usually identified by the ones who call themselves 'collectors of Hermès' and who regularly post pics of bags that if you look harder, can see all the plastics intact on the bag. Of course, many regulars will leave them on as a means of protection but they do it for the purpose of being able to resell. They're also generally the ones who post videos of bag inserts and how to use them. #ad #sponsored Always purchasing something new and saying it's the best thing at that moment in time (posting a lengthy unboxing and review video at the same time), and saying that they love it so much, only to sell a few months later... But hang on... Not before they post a long video about 'omg top handbag regrets'.

Some are smarter, they don't do sponsored partnerships and are very classy in presentation. They'll use resellers/consigners to sell for them and 'advertise' for them to their followers how fantastic they are without divulging their items are being consigned.

But, I just find it all interesting. I hadn't purchased or looked in years but only started looking into these things again recently and the behaviour of these 'bloggers' fascinated me in an eye rolling emoji kind of way. Resellers don't upset me, but I do raise my brow at those who claim that they're not but are. I also don't get upset at someone who is say consigning a bkc that they purchased years ago at a higher than paid price. In reality they might have had to spend more that preferred to be offered the bag, so a higher price may be justified.

I'm in Melbourne, Australia and we have been in lock down for a while and to see some members here openly post about going into the store to make purchases, on dates that can be clearly traced to be out of line with government set Covid restrictions makes me think even less of them. Not talking at the time of a post which may be after the fact, but clearly stating in their post which day in relation to their post that they went.

As long as the demand is greater than supply, this secondary market or reselling will always exist. Of course more efforts to curb the secondary market would be great (buying for pure purpose of flipping at profit, even if it is masked as a 'collector' making purchases and consistently selling after). However I don't ever see resellers going away. I've purchased from resellers above RRP myself but that is because I know even with spending 1:1 or more in store, it would be unlikely I would be offered my exact specs... Or offered anything at all. So I make the decision to purchase, enjoy and be grateful I can.

 

[jmen]

Interesting article. But H is a marketing genius that is why it is so successful. I know a lot of folks who buy from resellers or second-hand sources yet continue to try their luck in the H boutique itself. Why? Because H made it in such a way that being sold a highly coveted item in the “special room” and buying from the H store is a reward and an achievement by itself and gives an obviously happy feeling. In short, buying from the store is a very special experience by itself. That is why many clients keep on coming back despite of the fact that there are other avenues to source out an H item in a more simple way. How many brands have actually achieved that status? How many brands have actually been able to convince and train majority of their clients that being sold an expensive and “rare” item from them directly is a privilege? Genius indeed!

Marketing genius? I disagree. Picture yourself walking into the boutique and being lied to about not having what you asked if they had in stock and someone else walks in and is offered what you asked. How genius is it to play games with customers? In my world it is a sure fire way to insult and lose a customer or potential customer for life. If H prides itself on workmanship, the rest of their biz should as well. Isn’t there enough inequality already in the world?

Btw, back in the good old days, my Kelly was sitting on the shelf but somewhere along the way some genius decided to stop putting Birkins and Kelly’s out for sale.

 

[hannahsophia]

I know this is an old thread but somehow resellers do not irk me as much as the digital creators, influencers, video loggers, or whatever they call themselves... that claim not to resellers but their purchasing behaviour is just to keep up with producing 'content' for their channels. Many of whom are members here. I'm not talking about making a purchase and selling the item years down the track, I'm talking regular turnover of items in weeks/months.

They're usually identified by the ones who call themselves 'collectors of Hermès' and who regularly post pics of bags that if you look harder, can see all the plastics intact on the bag. Of course, many regulars will leave them on as a means of protection but they do it for the purpose of being able to resell. They're also generally the ones who post videos of bag inserts and how to use them. #ad #sponsored Always purchasing something new and saying it's the best thing at that moment in time (posting a lengthy unboxing and review video at the same time), and saying that they love it so much, only to sell a few months later... But hang on... Not before they post a long video about 'omg top handbag regrets'.

Some are smarter, they don't do sponsored partnerships and are very classy in presentation. They'll use resellers/consigners to sell for them and 'advertise' for them to their followers how fantastic they are without divulging their items are being consigned.

But, I just find it all interesting. I hadn't purchased or looked in years but only started looking into these things again recently and the behaviour of these 'bloggers' fascinated me in an eye rolling emoji kind of way. Resellers don't upset me, but I do raise my brow at those who claim that they're not but are. I also don't get upset at someone who is say consigning a bkc that they purchased years ago at a higher than paid price. In reality they might have had to spend more that preferred to be offered the bag, so a higher price may be justified.

I'm in Melbourne, Australia and we have been in lock down for a while and to see some members here openly post about going into the store to make purchases, on dates that can be clearly traced to be out of line with government set Covid restrictions makes me think even less of them. Not talking at the time of a post which may be after the fact, but clearly stating in their post which day in relation to their post that they went.

As long as the demand is greater than supply, this secondary market or reselling will always exist. Of course more efforts to curb the secondary market would be great (buying for pure purpose of flipping at profit, even if it is masked as a 'collector' making purchases and consistently selling after). However I don't ever see resellers going away. I've purchased from resellers above RRP myself but that is because I know even with spending 1:1 or more in store, it would be unlikely I would be offered my exact specs... Or offered anything at all. So I make the decision to purchase, enjoy and be grateful I can.

I think a lot of people get wrapped up in buying the newest thing and taking photos to share it online, only to sell it a month or so later (and advertise the sale to the same followers). It’s so annoying. I had to unfollow a few people after noticing that.

 

[QuelleFromage]

I know this is an old thread but somehow resellers do not irk me as much as the digital creators, influencers, video loggers, or whatever they call themselves... that claim not to resellers but their purchasing behaviour is just to keep up with producing 'content' for their channels. Many of whom are members here. I'm not talking about making a purchase and selling the item years down the track, I'm talking regular turnover of items in weeks/months.

They're usually identified by the ones who call themselves 'collectors of Hermès' and who regularly post pics of bags that if you look harder, can see all the plastics intact on the bag. Of course, many regulars will leave them on as a means of protection but they do it for the purpose of being able to resell. They're also generally the ones who post videos of bag inserts and how to use them. #ad #sponsored Always purchasing something new and saying it's the best thing at that moment in time (posting a lengthy unboxing and review video at the same time), and saying that they love it so much, only to sell a few months later... But hang on... Not before they post a long video about 'omg top handbag regrets'.

Some are smarter, they don't do sponsored partnerships and are very classy in presentation. They'll use resellers/consigners to sell for them and 'advertise' for them to their followers how fantastic they are without divulging their items are being consigned.

But, I just find it all interesting. I hadn't purchased or looked in years but only started looking into these things again recently and the behaviour of these 'bloggers' fascinated me in an eye rolling emoji kind of way. Resellers don't upset me, but I do raise my brow at those who claim that they're not but are. I also don't get upset at someone who is say consigning a bkc that they purchased years ago at a higher than paid price. In reality they might have had to spend more that preferred to be offered the bag, so a higher price may be justified.

I'm in Melbourne, Australia and we have been in lock down for a while and to see some members here openly post about going into the store to make purchases, on dates that can be clearly traced to be out of line with government set Covid restrictions makes me think even less of them. Not talking at the time of a post which may be after the fact, but clearly stating in their post which day in relation to their post that they went.

As long as the demand is greater than supply, this secondary market or reselling will always exist. Of course more efforts to curb the secondary market would be great (buying for pure purpose of flipping at profit, even if it is masked as a 'collector' making purchases and consistently selling after). However I don't ever see resellers going away. I've purchased from resellers above RRP myself but that is because I know even with spending 1:1 or more in store, it would be unlikely I would be offered my exact specs... Or offered anything at all. So I make the decision to purchase, enjoy and be grateful I can.

A large percentage of these folks are lying and/or unboxing fakes. Sorry to say, there is a robust market in selling fakes, too, and some the "lifestyle" influencers feel like they need to show a new bag every week. The sheer size of the superfake companies tells you the market remains huge.

 

[showgratitude]

Marketing genius? I disagree. Picture yourself walking into the boutique and being lied to about not having what you asked if they had in stock and someone else walks in and is offered what you asked. How genius is it to play games with customers? In my world it is a sure fire way to insult and lose a customer or potential customer for life. If H prides itself on workmanship, the rest of their biz should as well. Isn’t there enough inequality already in the world?

Btw, back in the good old days, my Kelly was sitting on the shelf but somewhere along the way some genius decided to stop putting Birkins and Kelly’s out for sale.

You can disagree but one fact remains, business is still good for Hermes even if the Bs and Ks are not out for sale for everyone that wants it and they are hard to acquire. Hermes stock prices are up as well.....even with the pandemic. Obviously, they are a marketing genius. Sorry that you felt insulted by their strategy and they lost you as a customer. But truthfully and not to be harsh, I don't think they care because they have other customers. In fact, the demand for most of their products far exceeds the supply. But of course it is your prerogative not to patronize something that makes you feel that way.

 

[jmen]

You can disagree but one fact remains, business is still good for Hermes even if the Bs and Ks are not out for sale for everyone that wants it and they are hard to acquire. Hermes stock prices are up as well.....even with the pandemic. Obviously, they are a marketing genius. Sorry that you felt insulted by their strategy and they lost you as a customer. But truthfully and not to be harsh, I don't think they care because they have other customers. In fact, the demand for most of their products far exceeds the supply. But of course it is your prerogative not to patronize something that makes you feel that way.

You incorrectly assumed the experience I spoke of was my own and that I no longer purchase from hermes. Those that have disposable funds will continue their spending on luxury goods, and if you follow that logic you may be able to grasp that it not a wise business move to alienate customers be they hermes or the person who sells widgets. I would venture to say if someone walks into a boutique more than likely they have money to spend. As a stockholder I hate to be the bearer of this tidbit of news, but hermes stock cannot hold a candle to Tesla, Google, Amazon, especially if you bought at the ipo.

 

[showgratitude]

You incorrectly assumed the experience I spoke of was my own and that I no longer purchase from hermes. Those that have disposable funds will continue their spending on luxury goods, and if you follow that logic you may be able to grasp that it not a wise business move to alienate customers be they hermes or the person who sells widgets. I would venture to say if someone walks into a boutique more than likely they have money to spend. As a stockholder I hate to be the bearer of this tidbit of news, but hermes stock cannot hold a candle to Tesla, Google, Amazon, especially if you bought at the ipo.

I find it odd that you say negative things about the company yet still imply that you continue to support it. Sorry that your H stocks cannot be comparable to the others that you mentioned as you stated here. I hope you study your options better next time..and that you are luckier. Some people may not like the marketing strategy of H---and they don’t have to like it and patronize it if that is how they truly feel. One fact remains though, that their strategy is working and is raking in the big bucks obviously..even if you continue to say that they don’t have a wise business move.

 

[jmen]

I find it odd that you say negative things about the company yet still imply that you continue to support it. Sorry that your H stocks cannot be comparable to the others that you mentioned as you stated here. I hope you study your options better next time..and that you are luckier. Some people may not like the marketing strategy of H---and they don’t have to like it and patronize it if that is how they truly feel. One fact remains though, that their strategy is working and is raking in the big bucks obviously..even if you continue to say that they don’t have a wise business move.

hope your quivers run out soon, namaste

 

[Gabs007]

Does anyone here read Business of Fashion? This analyst writes quite a lot there and his Hermes articles are often way off. I wouldn't take his and a reseller's estimates as necessarily close to reality. The H annual report tells you quite clearly what leather represents in revenue (50% in total approx and this includes SLGs and saddlery, where they still do quite well) - the 25-30% on just two bags styles seems like a guess to me.

I think it feeds into the myth that if you manage to buy a Birkin or Kelly, you can resell it for twice the price, doesn't happen...

 

[QuelleFromage]

I think it feeds into the myth that if you manage to buy a Birkin or Kelly, you can resell it for twice the price, doesn't happen...

The people who distributed the article on Birkins appreciating better than gold deserve a sharp slap. Sure, if you bought one in a popular color, leather, and size ten years ago and barely used it, you could "make" money on the price increase - you might get today's retail or even a bit more for a perfect bag. But 1) that money is worth less today than it was ten years ago (hello inflation and cost of living increase), so it's less profit than you think and b) you have to go through the hassle of selling and/or you're paying a reseller a percentage.
If you buy a brand new bag today and give it to a big reseller, they will take the lion's share of profits and you don't get to use or keep the bag (and I'm not super sure on your karma there).

In the end it's NOT what any real analyst would call ROI.

 

[Gabs007]

The people who distributed the article on Birkins appreciating better than gold deserve a sharp slap. Sure, if you bought one in a popular color, leather, and size ten years ago and barely used it, you could "make" money on the price increase - you might get today's retail or even a bit more for a perfect bag. But 1) that money is worth less today than it was ten years ago (hello inflation and cost of living increase), so it's less profit than you think and b) you have to go through the hassle of selling and/or you're paying a reseller a percentage.
If you buy a brand new bag today and give it to a big reseller, they will take the lion's share of profits and you don't get to use or keep the bag (and I'm not super sure on your karma there).

In the end it's NOT what any real analyst would call ROI.

I had almost the very same discussion with somebody, she was "Oh if I would have bought a Hermes in 2002, it would be worth so much more now..." I just rolled my eyes and went "And if you would have used that money and not bought a Hermes but Apple shares, you could now afford several Hermes a year just from the dividends and the increased value..." And you never need to worry about signs of wear or scratches...

I think we all have bought one or several bags that simply didn't work for us, then sold them on, while they were still pristine. we all lost money.

I read somewhere that Jean Birkin got the 1st Birkin ever made as a present (she didn't like it very much) and it was auctioned off for a charity a few years ago, you would think that the 1st ever made one, previous owner Jean Birkin, the prices would go through the roof, I think it roughly fetched around the same as a new one.