As many struggle in this economy, the French fashion house Hermes flourishes. The company turned in a 24% gain in U.S. sales for the first half of the fiscal year. While other luxury companies are struggling, the exclusive Hermes continues to churn out sales. Now, I must admit, my luscious Hermes Kelly Long Wallet in alligator goes to show that we, the people, are still shopping and buying ridiculously expensive bags from the luxury house. There are plenty of Crocodile Birkins, Kellys, scarves, and chinaware being bought along with all other exclusive Hermes goods to keep the brand bringing in a profit. Also, the price hikes are not hurting.

The article in Forbes is really interesting to hear that the old luxury model Hermes uses is so different from other brands, and continues to prove profitable. What else do you think makes Hermes stand apart from the rest?

Read the full article via Forbes

In the first half of the fiscal year, the company saw a 24% gain in U.S. sales. Worldwide, sales increased 12.8% to 813.2 million euros ($1.3 billion) from 721.1 million euros ($1.1 billion) in the same period the year previous. Second quarter sales were just-as-impressive worldwide, up 12.1% to 398.1 million euros ($631 million) from 355.5 million euros ($564 million) in 2007.

Unlike many of its competitors, including major French conglomerates Louis Vuitton Moët Hennessy and PPR, owned by billionaires Bernard Arnault and Francois Pinault, respectively, the brand has been able to increase sales by continuing to please its core customer, rather than aiming to attract a broader audience. At Hermès, you won’t find a $500 dollar handbag like you will at PPR-owned Gucci, or $300 plastic costume earrings, which are on sale at privately-owned Chanel. Instead, the 170-year-old company focuses on producing limited editions of their handbags, which begin at $5,000.

“What’s really interesting about Hermès is that they have not followed the typical luxury model,” says Lucian James , president of Agenda Inc, a brand strategy firm in Paris and San Francisco. “When other luxury brands were reaching to a slightly bigger mass market, Hermès made a very specific decision not to do that.”

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