RE: Hermes crocodile leather used in Birkin

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  1. Came across this article, and thought it was interesting.

    http://www.reuters.com/article/reutersEdge/idUSTRE4915AV20081002

    "...The process of tanning raw crocodile hide to leather takes about a month. To make a luxury handbag, such as the Hermes Birkin bag, takes about three crocodile hides each costing around $300. The end product sells for around $45,000."

    Keep in mind that the quoted amount above, is solely the quoted costs for the firm in the article (Heng Long), and not directly the tanneries used by Hermes and others. But...there is an element of truth to it. Because if other tanneries found it costs them double or triple the cost, it would not be financially wise to do so.

    So in theory...the basic material cost for just the crocodile leather for a Birkin...is around $900. (Although I'm surprised that the article says it takes 3 hides. I was more under the impression it takes 2 hides).

    Either way...very interesting.
     
  2. yes, very interesting indeed. Now the price increase makes even less sense...
     
  3. #3 Jan 28, 2009
    Last edited: Jan 28, 2009
    Does "tanning" include colouring? Or is that another cost to be added on? I did look but couldn't see any reference to this.

    Also how about the average wage would be for the craftsperson to put the bag together? At an average of about 20 hours I'm sure it won't be anywhere near justifying the quoted price of $45,000. :confused1:

    I know there is a huge wealth of knowlege on tPF, so please correct me if I'm wrong. :tup:

    Also, as this is not the tannery for Hermes, could it be that the tannery that H uses charges more as Hermes won't accept a sub-standard skin so they have to charge more per unit as they sell less? (just random thoughts now)
     
  4. ouch, now we know where our 44K ends up:cursing::cursing::cursing:
     
  5. How much does the average artist pay for canvas and paint?

    Yet in the proper hands those end up being worth millions.
     
  6. Anyone in retail will tell you that the mark-up on products is about 250% to cover cost. With a brand behind you, you will be looking at a multiple of 10 times upwards. Its called beezzz nest. Hermes is extremely profitable as they spend quite little in advertising thanks to the Birkin bag....
     
  7. NOt that it justifies the cost in terms of work and materials, but it's also more difficul to work with crocodile for the craftsmen, it may take longer etc.
     
  8. please note that the crocs h uses are from other countries ! plus h uses bigger skins the bigger the skin the older the croc the older the croc the higher the cost of nurturing them etc! also just take a look at h skins and skins used at prada or gucci etc you will see and feel a difference (same with ostrich btw)
     
  9. Tanuki - So well said! Brilliant!

    (I imagine myself with a canvas and paint and let's just say the results would be worth far less than the materials!)
     
  10. Iilach - good point. Also, the larger skin means the croc has been around a while and these creatures are aggressive to say the least. All the more difficult it would be to find a quality hide without "fight" marks and such.
     
  11. yup this point plays a big role in the costs associated with keeping those animmals the need loads of space different areals etc
    also i might add put into account the skins that are not suitable aka years of work and money lost the top skins have to priced accordingly to buffer these.
    then add the work at hermes by properly paid craftsmen and all the other costs and voila.
    and frankly i have said it before i do not find the exotics at h totally out of this world priced they are actually quite "affordable" if you cvompare it to other manufaturers
    armani croc tote ? 48 K but that is not porosus and likely won´t outlast you and "after sale service" is a word never heard there kwim?

    and ostrich? tell me one other manufacturer where each follicel is hammered down by hand ? gucci is quite bumpy while not neccesarily cheaper

    but in the end it is the same with each and every item h or not or croc or calf - if it is worth it to you then all should be fine if you do not agree with the prices fine too there are other options !
     
  12. Iilach - applause! Applause!
     
  13. Just thought I would add...that after a quick search, I found Hermes Intl's financial site.
    http://www.hermes-international.com

    Details quarterly reports, press releases etc.

    In 2007, Hermes fully acquired a firm named " Soficuir, a group specialised in selecting, buying and tanning exotic skins". (Hermes previously owned 49% of the company. They basically bought out the remaining 51%). Their specialty was in crocodile skins.

    Prior to that, Hermes owned a firm named "Gordon-Choisy"...which also was a tanning facility.

    Interesting tidbit: The Soficuir group operates in four countries: France (with a production plant in the department of Sarthe), Italy, the United States and Switzerland. (So it seems there is an Hermes owned tanning facility in the US somewhere).

    Lots of interesting info I'm coming across.