Hermes Japan sales boom
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Hermes Japan has driven the luxury handbag and apparel brand to a 20 per cent increase in first half profit.
For many successive quarters, Japanese have been maintaining tight control of their spending – but this year life has returned to the retail sector – and the luxury market especially. And cashed up Chinese – who once travelled across the border into Hong Kong for their high fashion indulgences – are now heading to Japan instead.
Hermes International says the Japanese sales increases has proved more than enough to make up for China’s economic slowdown, where sales have slipped for most luxury brands this calendar year.
Paris-headquartered Hermes says its global operating income increased to US$842 million on sales up 21 per cent to US$2.58 billion.
Hermes says its Japanese sales climbed 20 per cent in the six months to June 30 at constant exchange rates. Across the rest of Asia, sales rose just seven per cent; in Hong Kong they dipped by an unspecified amount. That market was “difficult”, the company said.
Questions & Answers
Q.What is the primary reason for Hermes' increase in first-half profit?
What is the primary reason for Hermes' increase in first-half profit?
Hermes' first-half profit increase was primarily driven by a significant boost in sales from its Japan division. Japanese consumers have returned to the retail sector, especially the luxury market, alongside Chinese shoppers visiting Japan.
Q.How much did Hermes' global operating income and sales increase in the first half?
How much did Hermes' global operating income and sales increase in the first half?
Hermes' global operating income increased to US$842 million. Overall sales for the company rose by 21 per cent, reaching a total of US$2.58 billion during the first half of the year.
Q.Where are Chinese luxury shoppers now choosing to make their purchases?
Where are Chinese luxury shoppers now choosing to make their purchases?
Cashed-up Chinese luxury shoppers are now heading to Japan for their high fashion indulgences. They previously travelled to Hong Kong for such purchases, but have shifted their destination.
Q.How did sales perform in other Asian markets compared to Japan?
How did sales perform in other Asian markets compared to Japan?
Across the rest of Asia, excluding Japan, Hermes sales increased by just seven per cent. In Hong Kong, sales dipped by an unspecified amount, with the company describing that market as "difficult".
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