Handbag brand Hermès saw its sales drop by 7.2 per cent last year. However, the label managed to set an impressive growth track: by the fourth quarter, sales in Southeast Asia had already increased by 43 per cent.
Leaving competitors behind
The annual turnover of luxury house Hermès clocked in at 1.39 billion euros in 2020, down 7.2 per cent a year earlier. Net profit also fell to almost 1.4 billion euros. In 2019, it was still 1.53 billion euros. Nevertheless, with these results, the French luxury brand is outperforming many of its competitors.
In the first half of the year, the company suffered greatly from the Covid pandemic, but during the second half of the year, sales steadily picked up again. The fourth quarter was particularly noteworthy: while luxury giants LVMH and Kering saw a drop in sales, Hermès saw a 12.3 per cent increase in sales.
Bonus for every employee
This growth was primarily thanks to the Southeast Asia region, where, according to the company, Greater China, Korea and Australia showed a particularly good dynamic. As a result, sales rose by 43.4 per cent. By comparison, sales in Europe, still affected by lockdowns, fell by 10.8 per cent. For the year as a whole, the Asian market recorded growth of 14 per cent, partly with the help of a new e-commerce platform in the region. In Europe, annual sales ended up at minus 24 per cent.
For 2021, chief executive Axel Dumas confirms to have “ambitious” sales targets but also states that it is difficult to make predictions in the light of the current pandemic. The CEO promises every employee of the brand a generous bonus of 1,250 euros this year, as a thank you for their efforts over the past year.
