Hermès bag gang buys up half the supply

#31
I agree that while I don't like this, and it really sucks. BUT, this isn't illegal in any way unless of they evaded tax? Not sure what is illegal here. But I agree, this is such a bummer for us REAL lovers of hermes.

Honestly this exclusivity game is what leads to dumb s**t like this. I'm seriously so over it at this point. I feel like Hermes is just doing it to themselves now, they need to go back to their old ways or its going to crash and burn, the appeal is dying and that is concerning to us Hermes fans.

Also realistically speaking, isn't this what reputable resellers do anyways? Like I'm pretty sure Prive Porter and Janefinds all have similar systems to keep inventory rolling and please their customers lol...again, not a fan of these inflated prices and these secondary businesses doing it, but again, Hermes' exclusivity game is whats causing this ruckus in the secondary market.

Not hating, I love Hermes and forever will, but this is getting pretty tiring...
 
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#32
Any fool who pays 3 times the original price definitely has money and I bet has enough of it that they can shop at Hermes. How much of what we hear and see written are the facts sans exaggeration. As as as Hermes goes or any other retail, I really don’t think they care If the piece is resold once or a hundred times. They sold an item; it is out their door.
 
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#33
I’ve read a bit more about this latest supposed disrespect to Hermes and its victims. No sympathy from me, even tho I do love the brand and the experience of Hermes. Perhaps Hermes needs a new business model. The scarcity model isn’t working.

- fake showroom? Is that illegal?
- an 8-month operation? Some women wait years. So, these bags were purchased from the Hermes store then resold? This means the store has plenty of stock. Hmmm. I hope that fact sinks in with all who support Hermes. The store had the stock. These bags are indeed available. Somehow the ‘gang’ knew Hermes had the stock. Hmmmm. Another insider job?
- money-laundering — there’s the crime.

from the article:
French media reported that victims were invited to a fake showroom set up by the gang in an upmarket street near Hermès’s central Paris branch. Some bags were also exported to Asia. Ten suspects, aged 24-57, were detained this week after an eight-month operation.

Le Parisien said the gang was allegedly run by a man of Tunisian origin, working with Chinese nationals. All are suspected of money-laundering and undeclared work.

ETA:
The gang is alleged to have made a million euros a month by buying half the company’s supply and selling the bags for three times their retail price.

So, now, the stock is really low. Eeeek.
 
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#34
There could be Consumer Protection Law violations - but that is dependent on the country. Re-selling in itself is typically not illegal, it is the mark-up over retail price. It gets fuzzy when the market value is artificially inflated such as when bots buy all the concert tickets and the re-seller then controls that market. There will likely be more to this story. Possibly fraud of some sort. ETA: Carryon just posted money laundering

If Hermes wanted to stop this, they could easily. But that is not part of the "exclusivity" of their product nor of their manufacturing. Economics relies on scarcity, which is clearly controlled by Hermes.
If they allow everyone to purchase that wants the product and increase production to supply, the reseller will not be as profitable but it could dilute their own product market worth.
 
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#35
Le Parisien:

"False" buyers recruited from theater schools

It appears that the network was recruiting "mules" responsible for legally buying the bags in the 21 Hermès stores throughout France, and even in Europe. They were sometimes selected in theater schools or on social networks in order to give credibility to the image of wealthy customers and to defeat the vigilance of employees. So some small hands - mainly women - even wore Hermès clothes and recited scenarios to justify their interest in these highly prized luxury pieces: it could, for example, be a gift for a terminally ill loved one. 'cancer…

Because to become the happy owner of a Birkin or a Kelly, you have to show your white paw: make a good impression, register on the waiting list, explain your wish ... The demand is greater than the supply: each piece is unique and handcrafted by one of the 7000 Hermès artisans, without a sewing machine. It takes a week for them, all settled in France, to make a bag. These accessories sell on average between 7,000 and 8,000 euros each. Some models can reach astronomical prices - a Kelly bag in white crocodile skin has just been sold for 365,545 euros in Hong Kong.

According to investigations, these bogus clients for a day were paid up to 500 euros by the network to act and were constantly replaced. Nearly half of the bags sold in recent years by Hermès could have been acquired by "mules", despite the very great vigilance of the shops ... Some "false" customers have thus been "burned" by sellers, who then pretended no longer be able to place an order. Employees have themselves been approached by the network and, for some, dismissed by the house in case of doubt about their integrity.
 
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#36
The thing that bugs me personally about this is that people are SO desperate for a Hermes quota bag that they are willing to pay 3 times (allegedly) the retail price to have one and have one NOW!
I see posts on this forum from new members about 'playing the game' desperate for a Birkin or kelly-I do wonder how many of these people actually do genuinely LIKE the design of the bags, or thought about wether its their style or not? or wether they want them as a status symbol-which I find kind of sad and actually puts me off the idea of buying a new Birkin should one become available to me.
I Love the bag, I love the workmanship, the leather, the simplicity of it -the heritage of the brand but I find I'm veering more towards buying a Birkin that has been well used so it looks less of a 'status symbol' more what it was designed to be..a bag to carry 'stuff' that just so happens to be so beautifully made it will last a lifetime.
 
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#37
As many others have said, don’t buy Hermes stuff just to ‘play the game’. That practice is why Hermes gets away with this ‘scarcity’ nonsense. Clearly, this ‘gang’ did not need to do that...for 8 months, the gang bought bags. These bags are available. No sympathy for Hermes or those customers willing to pay triple. With each one of these ‘poor’ Hermes stories, we learn so much more about the brand.

Best advice that many on TPF have said — buy only what you love.

ETA: this is what happened to the Hermes workers involved in the fake bag scheme from 2013.

Ex-Hermes staff convicted for fake handbags

A Paris court on Thursday convicted 10 people, including seven former staff of French
fashionunited.uk fashionunited.uk
 
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#38
Regarding this part - “Employees have themselves been approached by the network and, for some, dismissed by the house in case of doubt about their integrity.” - For what it’s worth I have long heard the rumors that some SAs are in on it - they know about the fake customers but sell to them willingly to have the bags flipped, and get kickbacks in return for their help.

Also yes, the whole hiring people to buy the bags in Europe is something I’ve heard about for a long time. I have read about how they recruit buyers on SNS. I believe someone posted one such hiring ad in the “why so many Birkina available on secondary market” thread, you can go check it out.

The dress up part I’ve heard of too. I even remember coming across posts of an ex-buyer who did it as a part time job when she was a student in Europe; one funny detail I remember is that she said it’s actually nice to have some non-Hermès RTW on like Chanel, since that makes it look like you have money to spend on other brands besides just Hermès.

Also some of these people use the bags / goods they get for this flipping operation to make social media posts, posing as if the goods are their own, to pretend to be very rich people living a luxury life. Some may even amass a decent following, causing their fellow buyers to become jealous and expose them (if you follow a lot of Hermès posts on RED aka China’s Instagram, you probably had a chance coming across such an incident recently).

There is a reason that this is based in Europe - European pricing is significantly lower compared to that of other places e.g. Asia. As for three times retail, currently for the very desirable bags (say a size 25 in Noir GHW) the prespend is in fact more than 2:1 in some crazy competitive markets. So paying 3x the European price is actually still less than what one would have to spend to get it fresh from boutique in those places! They also don’t just do Hermès by the way, because of the pricing difference between different markets they also do similar things at other luxury brands; even without a “prespend” difference, the cheaper European prices can be enough to allow a profit by itself.

ETA: I too wonder what exactly is the illegal part. I have no doubt that Hermès can try to ban these people and not allow them the bags (which is probably why they hire people so you get fresh faces eh?) but police arrests...? I’m no legal export though. Yeah maybe that show room has sth to do with it...
 
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#40
Vln said:
The way to put an end to this is by not buying from resellers. If resellers had no customers, they would go out of business. As long as they have a market, they will continue with these kind of schemes.
Click to expand...

It’s a pandemic. There is a market for everything now. People have plenty of time to be ‘disrupters’.
 
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#41
momoc said:
Regarding this part - “Employees have themselves been approached by the network and, for some, dismissed by the house in case of doubt about their integrity.” - For what it’s worth I have long heard the rumors that some SAs are in on it - they know about the fake customers but sell to them willingly to have the bags flipped, and get kickbacks in return for their help.

Also yes, the whole hiring people to buy the bags in Europe is something I’ve heard about for a long time. I have read about how they recruit buyers on SNS. I believe someone posted one such hiring ad in the “why so many Birkina available on secondary market” thread, you can go check it out.

The dress up part I’ve heard of too. I even remember coming across posts of an ex-buyer who did it as a part time job when she was a student in Europe; one funny detail I remember is that she said it’s actually nice to have some non-Hermès RTW on like Chanel, since that makes it look like you have money to spend on other brands besides just Hermès.

Also some of these people use the bags / goods they get for this flipping operation to make social media posts, posing as if the goods are their own, to pretend to be very rich people living a luxury life. Some may even amass a decent following, causing their fellow buyers to become jealous and expose them (if you follow a lot of Hermès posts on RED aka China’s Instagram, you probably had a chance coming across such an incident recently).

There is a reason that this is based in Europe - European pricing is significantly lower compared to that of other places e.g. Asia. As for three times retail, currently for the very desirable bags (say a size 25 in Noir GHW) the prespend is in fact more than 2:1 in some crazy competitive markets. So paying 3x the European price is actually still less than what one would have to spend to get it fresh from boutique in those places! They also don’t just do Hermès by the way, because of the pricing difference between different markets they also do similar things at other luxury brands; even without a “prespend” difference, the cheaper European prices can be enough to allow a profit by itself.
Click to expand...

haha, I know who you are talking about on RED, the fake rich shopping haul at Hermès Monaco, lol
 
#45
Encore Hermes said:
“All are suspected of money-laundering and undeclared work”
I cannot access the article but they were arrested for tax evasion non?
Click to expand...

Yeah I think that would make the most sense to me. I can see how they are not running an official business fully registered with all the paperwork, so that is probably where they would run into trouble.
 
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