While admittedly I have become quite the creature of social media of late, I tend to keep my Instagram posts fairly accessible and middle-of-the-road: my personal experiences or purchases, my artwork, and writings, dogs and kids, photos demonstrating that my life, just like anyone else’s, can be completely ridiculous, or beautiful, or weird. And while I am at least somewhat of an expert on Hermès 😉, you won’t get breaking news from me, much as you might want it: you may hear something elsewhere first, and I’m ok with that because I know that when I share information with you, it is honest, it is solid, and (unless I tell you otherwise) I am the source of the information. It’s not that I don’t have news – photos of the latest and greatest, rumors confirmed or denied, what’s coming in or going out – it’s that I respect and enjoy these brands, and I know that anything in this business can change at the drop of a hat. I hope to be as comprehensive and clear as possible: I don’t deal in fashion whiplash.

However, for the last few weeks, I have purposely avoided a particular topic that is on everyone’s mind, which only seems to loom larger as the year progresses towards the holiday season. Everyone is talking about it, some are preparing for it, each purveyor is dealing with it to some extent, but I have yet to see much (besides a tepid WSJ article) written about this topic, much as I’d hoped someone else with a bit of real source knowledge would: questions regarding luxury goods in the supply chain. The longer I have avoided broaching this topic, the wilder the stories I am hearing have become.

The Rumors

First, it was that shipments were slow; well, yes, that’s understandable, I thought.

Then, it was no bags will be delivered to the US for the rest of the year: concern, maybe even a bit of alarm.

After that, it grew to no shipments at all will be arriving for the rest of the year. Say, what???

Then last week, someone told me that they had heard that there will be no more bags next year, either. Yeah, that was the moment I decided that someone (me, I guess) needed to Set. The. Record. Straight.

So – here I am. Breaking news. Ok, let’s get down to it.

So What’s the Deal With Our Supply Chain?

If you’ve turned on the television or radio, or rather, if you are not living entirely off the grid, then you have heard about our supply chain issues. We import quite a lot of goods from all over the world, and there have been numerous complications getting these products into port, offloaded and transported, and delivered to stores. This matter is affecting products across the board, as a trip to nearly any store will show. However, it is important to note several things with regard to luxury goods in general and Hermès in particular.

First, there is no issue with production. Indeed, as I explained in my article on the Hermès 2020 corporate report, Hermès is expanding production with new and additional craftspeople, ateliers, and boutiques. The sources and the manufacturing process are all humming along.

Yes, to a minor extent, there is an issue with getting items delivered, but not as much as some may think. Indeed, the issue has far more to do with consumer demand and sales than anything else.

In 2020 many people spent months, if not the entire year, in lockdown. Some stores were closed for significant periods of time. The first podium during COVID was in Summer 2020, ordering for Spring-Summer 2021. The second podium was in late January of this year, ordering for our current season of Autumn-Winter 2021. These orders were placed during a very unusual time, with some stores still in lockdown and others just getting back into their sales groove. Therefore it was incredibly difficult, if not impossible, to predict the strength of sales 6-to-10 months in advance. Understandably, many boutiques played it safe with their orders, purchasing conservatively. The online podiums were more challenging, too, as the lack of being able to see and handle the product lines in person led to more “surprise” successes than usual (and is why I had to utilize the help of scarf friends when trying to acquire both Space Derby in the Spring and Eleftheria in the Fall).

But What’s Really Going On?

Concomitantly, Hermès sales have soared. Its investment in design, its production values, its quality have all reverberated with what was for some time quite literally a captive audience. Many of the product lines have had genuine hits, from shoes (in particular the Calya and Carlotta mules, the Daydream Sneakers, and the fuzzy Orans), to the new high jewelry lines, perennially popular scarf and twilly designs, the expanded makeup range, tried-and-true home goods (is it even home decor if there isn’t an Avalon blanket?), bag iterations in the joyous and aesthetically pleasing colors we’ve always wanted (we don’t need new colors when we just want more Rose Sakura and Mauve Sylvestre), some with that exotic touch, the always-popular Apple Watch (version 7 just released on October 15) and some impossible-to-find SLGs, from the Calvi Duo to Pegase Rodeos. Every other newscaster telling us to “buy for the holidays now” certainly isn’t helping slow things down.

In my personal opinion and experience, I have never seen such high demand for Hermès products, and I mean this across all departments. There are plenty of items being produced, but they are selling quickly. The glitches in shipping and perhaps a more conservative-than-usual number of orders have only impacted the appearance of scarcity. Still, I personally believe that, more than anything, it is the lines I see outside the boutiques at any time of day that really tell the tale.

Do you agree with my assessment? Tell us what you think in the comments!

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Elna
Elna
21 days ago

It is ALWAYS a case of supply and demand.

On the demand side, two other factors: The 2nd hand lux market is going international and booming, which means demand for first hand will also boom because of the the higher salvage value.

The rich has become richer during the pandemic. Another boom boom.

Jenn
Jenn
23 days ago

You are right on target in speaking to the shipping issues. There is currently a container shortage due to different countries having different laws with regards to handling of containers. Add to that many people not working for long periods of time and you now have back log on with many shipping companies being forced to reuse old container they would normally retire because they don’t have enough containers. Additionally, to get people to go back to work, transport companies are being forced to pay higher wages All of these cost get passed on to us, the consumer. Higher oil prices? up the price. Sprinkle in a some extra inflation due to the sheer amount of money that has been injected into economies across the globe and you now have more money chasing fewer goods. Plenty of money and no where to go? Buy a new bag. With supply always restricted by luxury companies, the price increases are to be expected, and unless circumstances change, I would expect to see more increases.

Carin Kirby
Carin Kirby
23 days ago
Reply to  Notorious Pink

And Thank God they did! Lol

Ivory
Ivory
23 days ago

Makes a lot of sense that store managers and directors worked be more conservative for Podium in the last few halves. Explains the current shortage perfectly.

ZSG
ZSG
22 days ago

This is an interesting article and I appreciate your take on it (especially given your experience and expertise with Hermes).

I work in tech and I can vouch for the fact that demand for luxury goods is HIGH and supply is very low. I’m guessing that this demand is what spurred Chanel and other retailers to do their 2nd (maybe 3rd) price increase this year. I would venture to say that the labor shortage isn’t helping the supply chain issue (fewer people to make the goods means fewer goods to sell). I’ve also seen luxury brands doing a quiet early sale to their best clients & customers, so if you don’t have a CA/SA you work with, ordering that special handbag or SLG is going to be more difficult as you don’t have that relationship.

I think I veered a little off-topic here but overall, I feel your article is pretty accurate.

Krissy Jones
Krissy Jones
18 days ago

Louis Vuitton also have major supply issues. Everything is sold out online, pre sales of fashion are over ordered and the store assistants have to beg to get their clients items.

Gelukkiglijf
Gelukkiglijf
17 days ago

Great post – this is just what I was looking for. Will have more of a nose around your site – thanks for the inspiration! Thanks for sharing best information with us!!

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