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MARKET OVERVIEW

1.1 Presentation

Leather goods refers to the industry of preparing fine leather and producing articles with this same leather, whether they are bags, gloves, belts, or other fashion items. While it is easy to name some of the houses that belong to the world of luxury, it is much less easy to draw a clear line between leather goods as a whole and the so-called luxury leather goods.

According to a a report from the National Leather Council, the leather goods sector as a whole generated a turnover of 3.236 billion Euros in France in 2017, for a sector that includes 448 companies and employs nearly 21,000 people in France.

Moreover, according to Mazars,"made in France" would be particularly sought after in a global luxury leather goods market that grew by 70% between 2003 and 2012.

The luxury leather goods market remains dominated by the main luxury brands, leaving little room for new entrants. The numerous takeovers testify to the growing concentration of the market.

The main source of growth in the market remains China and its upper-middle class with strong purchasing power.

 

1.2 A growing global market and optimistic professionals

Breakdown of luxury revenues by segment World, ****, % Source: ****

The global luxury market has grown in recent years to reach $**** billion in ****. **% of revenues are for the luxury personal goods segment, which includes luxury leather goods.

Breakdown of luxury personal goods revenue by segment World, ****, % Source: ****

The Luxury Leather Goods segment represents ...

1.3 A fast growing French market

In line with the good figures worldwide, luxury leather goods are doing very well in France.

Evolution of luxury leather goods sales France, ****-*****, million euros Source: ****

Luxury leather goods recorded a strong increase between **** and ****. According to Euromonitor forecasts, this trend is expected to continue: between **** and ****, Euromonitor considers that ...

ANALYSIS OF THE DEMAND

2.1 A demand primarily from women

Distribution of sales of luxury leather bags and small leather goods by gender France, ****, % Source: ****

The demand for luxury leather goods in France is mostly female. Sales of luxury leather bags and small leather goods are mainly aimed at women. The latter accounted for **% of sales in **** and still accounts for ...

2.2 The different consumers

Tourists, especially from China

Luxury leather goods have been able to benefit from an increase in local and especially international purchases. Indeed, France has set new records in terms of tourist arrivals, with over ** million foreign visitors in **** and ****. Among them are Chinese tourists, who now play a key role in ...

2.3 Sustainability criteria: the emergence of veganism

According to a BCG survey, **% of the French consider that their purchasing behavior is influenced by sustainable development criteria. This trend is even stronger among the younger generations. However, the criteria vary according to the age category as illustrated below.

Which sustainability criteria do you value when it comes to buying ...

2.4 The Made-in France label

Made-in-France is a guarantee of quality: consumers associate it with know-how and history.

Which manufacturing country do you consider the best for luxury brands? World, ****, % Source: ****

According to a survey conducted by BCG, France ranks second in terms of recognition of its know-how. Although Italy is considered the best manufacturing country ...

MARKET STRUCTURE

3.1 At the base of the value chain: the activities around the raw material

Suppliers of raw hides and skins

Companies operating in the leather and raw hide sector are often directly integrated into the slaughterhouses. Their activity depends largely on the economic situation of the agricultural world (***) as well as on the evolution of the national and international leather market.

Evolution of the turnover ...

3.2 French leather goods production concentrated in Ile-de-France and Auvergne-Rhône-Alpes

In this section, we broaden the scope of the study, and focus not only on luxury leather goods, but leather goods in general and more specifically items manufactured in France (***). The turnover of the French Leather Goods industry amounts to *.* billion euros, up *% from last year in ****. [***] This trend is explained ...

3.3 A concentrated market

Breakdown of the luxury leather goods market share France, ****, % Source: ****

The French market is highly concentrated: indeed, * groups gather **% of the market share. These are LVMH SA, Hermès International SCA and Kering SA. LVMH SA is the leader in this market, with **% of sales, far ahead of Kering SA (***).

While ...

3.4 The distribution of leather goods is marked by the rise of digital technology

Evolution of the distribution of luxury leather goods sales by type of distribution France, ****-****, % Source: ****

It can be seen that the majority of sales are made in stores. Online sales are in the minority, but the share of luxury leather goods sales made online has been growing steadily in recent ...

ANALYSIS OF THE OFFER

4.1 Price range & auction

Pricing of leather luxury products

Source: ****

Although it is difficult to define a clear boundary between what is luxury and what is not, one great characteristic that is unique to luxury items is that they have no upper price limit. Thus, if we can arbitrarily consider that a luxury handbag starts ...

4.2 Production concentrated on a small number of products

In this section, we broaden the scope of the study, and focus not only on luxury leather goods, but leather goods in general and more specifically on items manufactured in France (***). Billing for leather goods manufactured in France by an establishment or one of its subcontractors amounted to approximately €*.* billion in ...

4.3 The growing importance of the second-hand market

The second-hand market is steadily increasing. Luxury brands of bags and luggage are particularly popular via these channels, with bags accounting for **% of the second-hand market in France and small leather goods accounting for **% of luxury second-hand purchases.

Multiple web platforms promote second-hand items, as illustrated in the chart below:

Platforms ...

4.4 The threat of counterfeiting

European luxury manufacturers lose nearly ** billion euros a year to counterfeiting. [***] This is not only a loss of revenue, but also a loss of direct jobs: legitimate manufacturers need less manpower and as a result, nearly ***,*** jobs are considered directly lost in these sectors across the EU. Specifically, the luxury clothing, ...

REGULATION

5.1 Regulations

The "leather" denomination

The term leather is protected by French regulations (***), chips or powders of reconstituted leather and even materials derived from bio-manufactured hides can not bear the name leather. The indications "synthetic leather", "reconstituted leather" or "leather of ..." are therefore not legal and have no right to be affixed to ...

POSITIONING OF THE ACTORS

6.1 Segmentation

  • LVMH Vins et Spiritueux
  • Hermès International
  • Prada
  • Kering
  • Chanel
  • Michael Kors
  • Christian Dior Couture France
  • Maroquinerie Auguste Thomas
  • Les ateliers d’Armançon
  • Texier
  • Maroquinerie Pierre Cotte
  • Lancel
  • Lancaster
  • Farfetch

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Reviews (5)

The baby clothing market - France

Publicado en 07/09/2022 by Dan

I found this study to be very complete yet concise. It gives the main trends of the market and does not limit itself to "basic" figures such as sales figures, but also deals with pricing strategies and trends according to the positioning of the players. It's a study that has really served me well and that deals with marketing, the regulatory side, the offer, the competition and the pricing. Bravo!


Businesscoot Response:

Thank you Dan !

The sportswear market - France

Publicado en 08/08/2022 by Domaine Saint Roch - Domaine Saint Roch

Operational

The men's ready-to-wear market - France

Publicado en 16/06/2022 by F Faiz

rewarding study thank you very much for your work!

The handbag market - France

Publicado en 27/05/2022 by Frederic Fournier - Airbus

Clear and well-documented study; I would have developed the new consumption trends a little more, especially the new expectations and buying habits of generations Y and X, to reinforce the strategic perspectives of the handbag market.

The handbag market - France

Publicado en 23/04/2022 by Deborah Balzan - BALZAN Déborah Fleur

The study contains a lot of very interesting information.