LVMH - The Luxury Goods Conglomerate

[PDFSD]

yes and no i would say :

DIOR i know from my friends in HQ they did tell me the bags story did hurt the reputation in Asia

The irony was it was a dior homme bag but the news spread was that i was a dior women's bag because many news and online comentors used the dior book tote as symbol for the news .

Just as with Chanel the price increase versus quality tik tok / online debate also impacted the sales , made the chanel HQ people talk about regretting the price increase (again direct info from chanel hq folk)


I think its a mix of things that create a downturn it might not be immediately or clearly visible but there are ripple effects and brands are not happy with these things because before you know it its a snowball effect.

 

[PDFSD]

i think something will shift as so many voices online extending the news cycle like this writing on linkedin about loro piana like this article below of 3 days ago :

𝗤𝘂𝗶𝗲𝘁 𝗹𝘂𝘅𝘂𝗿𝘆 𝗶𝘀 𝗴𝗲𝘁𝘁𝗶𝗻𝗴 𝗹𝗼𝘂𝗱.

Last week: Loro Piana, now under judicial administration in Milan for labour violations in its Italian supply chain. It’s not alone - Dior, Armani, Valentino are all facing similar reckonings. The pattern? Invisible subcontractors, insufficient oversight, and fragile systems built on the myth of control.

This isn’t happening in a vacuum. Labour abuses, regulatory pressure, and eroding consumer trust are all symptoms of the industry’s deeper, systemic challenges. But underlying many of these risks, particularly the ones making headlines now, is a widespread lack of visibility.

The luxury sector is at its most precarious point in recent memory. Bain’s 2025 report flags flat global sales after years of double-digit growth. In Q2, the MSCI Luxury Index underperformed against major equities for the first time since 2018. Tariff hikes are shaving already tight margins. China, once accounting for almost one-third of luxury demand, is now forecast to stay flat for 2025, with spending shifting abroad and consumers demanding transparency and value. Even Dubai’s one-time shopping boom is showing signs of maturity and slowdown.

In this environment, supply chain opacity isn’t just a reputational risk. It’s a strategic vulnerability.

Luxury has always sold a story: mastery, provenance, control. But in today’s fragmented global chains, ‘control’ isn’t about perfect stitches, it’s about restoring trust. Trust now means seeing below the surface: not just knowing your suppliers, but knowing their suppliers, their systems, their breakpoints.

The era of elegant ignorance is over.

What’s emerging isn’t surveillance, it’s stewardship. Not compliance theatre, but real accountability for how value is created all the way down the chain.

Brands that understand this won’t just avoid tomorrow’s red headlines. They’ll set the new standard - 𝘮𝘢𝘬𝘪𝘯𝘨 𝘵𝘳𝘢𝘯𝘴𝘱𝘢𝘳𝘦𝘯𝘤𝘺 𝘭𝘶𝘹𝘶𝘳𝘺’𝘴 𝘵𝘳𝘶𝘦 𝘮𝘢𝘳𝘬 𝘰𝘧 𝘥𝘪𝘴𝘵𝘪𝘯𝘤𝘵𝘪𝘰𝘯.

 

[Kimihiro]

Does someone know how this affects younger audiences?

The fashionable teens and early 20s I know aspire/buy to contemporary brands (more so if niche) when only a few years ago they’d die to shop in Dior/Prada/Celine.

 

[Phuel]

i think something will shift as so many voices online extending the news cycle like this writing on linkedin about loro piana like this article below of 3 days ago :

𝗤𝘂𝗶𝗲𝘁 𝗹𝘂𝘅𝘂𝗿𝘆 𝗶𝘀 𝗴𝗲𝘁𝘁𝗶𝗻𝗴 𝗹𝗼𝘂𝗱.

Last week: Loro Piana, now under judicial administration in Milan for labour violations in its Italian supply chain. It’s not alone - Dior, Armani, Valentino are all facing similar reckonings. The pattern? Invisible subcontractors, insufficient oversight, and fragile systems built on the myth of control.

This isn’t happening in a vacuum. Labour abuses, regulatory pressure, and eroding consumer trust are all symptoms of the industry’s deeper, systemic challenges. But underlying many of these risks, particularly the ones making headlines now, is a widespread lack of visibility.

The luxury sector is at its most precarious point in recent memory. Bain’s 2025 report flags flat global sales after years of double-digit growth. In Q2, the MSCI Luxury Index underperformed against major equities for the first time since 2018. Tariff hikes are shaving already tight margins. China, once accounting for almost one-third of luxury demand, is now forecast to stay flat for 2025, with spending shifting abroad and consumers demanding transparency and value. Even Dubai’s one-time shopping boom is showing signs of maturity and slowdown.

In this environment, supply chain opacity isn’t just a reputational risk. It’s a strategic vulnerability.

Luxury has always sold a story: mastery, provenance, control. But in today’s fragmented global chains, ‘control’ isn’t about perfect stitches, it’s about restoring trust. Trust now means seeing below the surface: not just knowing your suppliers, but knowing their suppliers, their systems, their breakpoints.

The era of elegant ignorance is over.

What’s emerging isn’t surveillance, it’s stewardship. Not compliance theatre, but real accountability for how value is created all the way down the chain.

Brands that understand this won’t just avoid tomorrow’s red headlines. They’ll set the new standard - 𝘮𝘢𝘬𝘪𝘯𝘨 𝘵𝘳𝘢𝘯𝘴𝘱𝘢𝘳𝘦𝘯𝘤𝘺 𝘭𝘶𝘹𝘶𝘳𝘺’𝘴 𝘵𝘳𝘶𝘦 𝘮𝘢𝘳𝘬 𝘰𝘧 𝘥𝘪𝘴𝘵𝘪𝘯𝘤𝘵𝘪𝘰𝘯.

That's nice virtue-signalling. But the spending customer don't/won't care. (Its like all these leads of the creative departments will always emphasize their support of the environment/nature/humanitarian/sustainability cause in their public bios-- while working for conglomerates that empathize the importance of overpriced junk to impressionable status-seekers, desperate to flex at whatever costs.)

It wasn’t some confidential NDA that Kim Jones’ Dior acquired some of their merch from China’s wholesale tradeshow manufacturers, then alter/customize some minor components for their orders, and sell at their usual high markups as part of the Dior collections. Chinese vendors spoke openly of this— not as some revelation nor retaliatory action of the unscrupulous habits of the fashion industry, but simply as a matter of fact business behaviour.

Like Lola posted, giant corporations will always get away with it— more so than ever because of subcontracting maneuvers. Maybe they’ll be fined with an amount that’s nothing to them, as some performative gesture to shut up the few virtue-signallers on social platforms. But don’t count on any proposed regulations to change the abuse of labourers and the system, that’s been the MO of the business of fashion: It's has never been an exemplary model of equality/fairness/sustainability and absolutely not humanitarian standards, and it’s definitely not at this point. I’d observe it’s worse now more than ever. And the spending customer still don't/won't care.

 

[Frederic01]

BOF

 

[PDFSD]

SUN DeLuxe

LVMH the French group is too big to grow and H1 results that will be announced tomorrow will be underwhelming to say the least.
Also because of the unreasonable and unrealistic expectations for the Fashion division.
- Louis Vuitton is getting weaker and too much show off to keep the hashtag#luxury aura
- Christian Dior Couture is in the middle of a confused time. Hopefully Jonathan Anderson will get more focused and chic. Because this is what the French maison is about
- CELINE started well a new chapter highlighting for all the other brands what an evolution should be
- Fendi is totally unexpressed potential
- GIVENCHY too niche to thrive
- Loro Piana well…
- the Jewelry division is suffering with Bvlgari slow and Tiffany & Co. we don’t know
- SEPHORA and the Wines and spirits division with ideas of spin off and disposal

Who follows SUN DeLuxe knows I called the French group a giant with clay feet one year ago. Even if it is light years vs competitor Kering
But it should revise governance and organization to able to face the upcoming tsunami of the industry.
It’s a matter of fact.
Resistance of the status quo will not help.
Being bold and visionary once again will get them in a better position and out if the storm.

 

[yslforever]

I disagree on your statements that LP will not feel the pinch of the scandal in the next quarters.
I think spending customers, a fraction of them, will not buy, or much less, but not on humanitarian or ethical grounds, more on the feeling they have been defrauded or cheated: they have been sold merchandise on the promise it’s artisanal, handmade or the highest form of craftsmanship.
We had this discussion at lunch (typical old money multi billionaires, several LP VIC), they were appalled ; the sweatshop in the court case operated for LP for more than 10 years , the worker was beaten to the point he had a 45 days. The 4 € per hours. Etc etc .
They felt cheated by the brand and started questioning all the «Made in Italy » alternatives, like Brunello etc
They felt like Hemes was the only one remaining trusted brand.

 

[FashionPower]

The irony was it was a dior homme bag but the news spread was that i was a dior women's bag because many news and online comentors used the dior book tote as symbol for the news .

You're referring to the Dior Normandie, bag sold at 6k with crooked Dior hardware, right? LOL

 

[PDFSD]

You're referring to the Dior Normandie, bag sold at 6k with crooked Dior hardware, right? LOL
View attachment 1396637View attachment 1396638

would need to check the style code that was mentioned in the court papers to be 100% sure but i would not be surprised because the bag looks very straightforward cheap to make.

 

[PDFSD]

​

PUCKNEWS​

An Arnault Bros. Dilemma & The Kering Waiting Game​

News and notes from the fashion front lines: the micro-scandal swirling around Loro Piana and the implications for the Arnault heirs in charge; the chatter inside Kering as the company prepares for incoming C.E.O. Luca de Meo’s debut in September; the early signs that Burberry C.E.O. Joshua Schulman’s turnaround strategy is working; and more.

All that LVMH and the Arnault Bros. can do is continue to plead ignorance, and fix the process internally so it doesn’t happen again. Photo: Ludovic Marin/AFP/Getty Images

July 21, 2025​

Will Loro Piana Sales Be Hurt By the Sweatshop Accusations?​

When news broke last week that LVMH’s Loro Piana was being investigated by the Italian courts for using a factory accused of unfair labor practices, I shrugged. After all, the Italian government has cracked down on factories in general over the past year, and Loro Piana is only the most recent example of a name brand getting looped in. (Previously, Armani, Dior, and Valentino were all exposed.)

Loro Piana made it clear, in what was otherwise a pretty unclear statement, that the parties involved were subcontractors, and that they had no idea what was going on. It seems naive to believe that they weren’t aware, but these are subcontractors. And it’s also true that what constitutes “fair” and “unfair” labor practices in Italy has clearly changed in recent years—perhaps not in terms of the language of the law, but in how much the court cares. To me, this is yet another indication that these once local-yokel businesses, which are now global powerhouses, need to re-adjust their operations to reflect the increased regulation.

The funny thing about Loro Piana, in particular, is that the company culture is really good, especially by LVMH standards—so good, in fact, that employees were very upset when C.E.O. Damien Bertrand was called back to Paris to support Pietro Beccari at Louis Vuitton. L.P. was sort of left alone for the past decade, but now the fine-adjustment knob on the microscope has been turned up, since it’s currently one of the only growth engines in the LVMH portfolio.

Anyway, it’s a particular trial for chairman Antoine Arnault, who oversees image and communications for all of LVMH.
His little brother, Frédéric, became the C.E.O. of Loro Piana earlier this year, but has been roundly left out of the coverage of this mini-scandal for whatever reason. In the meantime, all that LVMH and the Arnault Bros. can do is continue to plead ignorance, and fix the process internally so it doesn’t happen again. (You can’t really avoid working with subcontractors in fashion, even if you’re pretty much vertically integrated, so they’ll have to manage it even more closely for a while.)

As for whether this will impact sales in any way—a question that a few LVMH employees did ask me—the answer is no. We all know people don’t vote with their dollars, and we also know that the value of most products does not directly correlate with the cost of making those products.

In my mind, this is a good lesson more than anything else.

---

 

[Grets]

It will impact sales. Not because their elite clientele have ethical standards or care about exploitation. They don't want to feel like they are being taken advantaged of. They'll go to Brunello or Zegna. Dior's sales fell by double digits after the scandal. Not because customers cared about workers being abused. They didn't want to look like suckers.

 

[yslforever]

It will impact sales. Not because their elite clientele have ethical standards or care about exploitation. They don't want to feel like they are being taken advantaged of. They'll go to Brunello or Zegna. Dior's sales fell by double digits after the scandal. Not because customers cared about workers being abused. They didn't want to look like suckers.

Exactly. 100% the feedback I got...
And the slipping continues:

 

[justpassingthrough]

 

[Lola701]

The challenge for LVMH is ultimately the insane gap between the first 2 houses and the rest. As I have said before, I think a little decline is healthy but I don’t think Vuitton will ever do 30 billions in sales and I don’t think it’s healthy for a brand like Dior to be as big as Vuitton. So the first two needs to have that kind of fluctuation between slow growth and small declines.

Now Celine, Fendi and Loewe combined are probably the size of Dior if not slightly below, all the attention will be there.

But I think the person with the most pressure in the group is Alexandre. Wines and spirit is really an issue…
Because there’s almost a formula in fashion in terms of operation but how to make people buy more Champagne?

 

[yslforever]

The challenge for LVMH is ultimately the insane gap between the first 2 houses and the rest. As I have said before, I think a little decline is healthy but I don’t think Vuitton will ever do 30 billions in sales and I don’t think it’s healthy for a brand like Dior to be as big as Vuitton. So the first two needs to have that kind of fluctuation between slow growth and small declines.

Now Celine, Fendi and Loewe combined are probably the size of Dior if not slightly below, all the attention will be there.

But I think the person with the most pressure in the group is Alexandre. Wines and spirit is really an issue…
Because there’s almost a formula in fashion in terms of operation but how to make people buy more Champagne?

Pay them more ? Reduce their prices... After all a bottle of Dom Pérignon does not cost more than any other bottle of champagne, it's not a secret in the industry, it's around 5€ to produce a bottle of regular basic champagne and no more than 8/9 € for DP

Also, when you know how they treated their Loro Piana slaves for more than 10 years, one can fear the worst for their vineyards' workers and people picking-up the grapes.

 

[Frederic01]

This.

Creeping “Big Luxury” Fatigue​

LVMH’s financial performance in the first half of 2025 comes against the backdrop of creeping “luxury fatigue,” a growing sentiment that mega-brands are losing some of their allure among key consumer groups. After years of aggressive price hikes, highly publicized celebrity collaborations, and increasingly logo-laden products (all aimed to relentless revenue growth), many consumers are showing signs of exhaustion with the dominance of “big luxury” – and are instead gravitating toward smaller, niche brands that emphasize authenticity, craftsmanship, and understated design.

This shift is particularly pronounced among younger, affluent buyers, who have exhibited a penchant for “quiet luxury” aesthetics and exclusive, investment-grade items like fine jewelry, rather than the conspicuous logo-heavy handbags that have long fueled LVMH’s Fashion & Leather Goods division. Analysts at UBS recently noted that “investors are starting to question the long-term structural attractiveness of the industry,” with LVMH’s shares down nearly 27 percent since the start of the year, compared to a 15 percent decline at Kering and relatively stable performance at Hermès and Richemont, which cater to ultra-wealthy clientele.

THEFASHIONLAW

There are queues outside Polène all the time. Meanwhile all the "mega-brands" are empty and the sales associates on idling and on their phones. It's so interesting that the industry is shifting from big brands to the more niche.

The truth is, you can't come back from the price increases. The quality can be improved, but after such aggressive price increases and the over-saturation of these products, there is little opportunity to grow.

Don't get me started on the tired celebrity/influencer culture that is without a doubt a component of luxury fatigue. We are constantly bombarded on social media with influencers that get invited to these shows, and are gifted things to wear - all for a brand that they clearly care very little about. The lack of authenticity has never been more clear. These people are using these LVMH (and Kering) brands to further their own personal brands and followings. And that is it.

Authenticity and value have gone out the window now at these mega-brands and there is no coming back. That is why brands like Polene, Toteme, The Row, etc, are thriving. There is authenticity and true value there. LVMH will never be able to compete with that because they are too mass.

 

[Lola701]

^^
Can we compare Polene to Vuitton though? Or even any other brand on the LVMH portfolio except for Patou, Marc Jacobs or Kenzo.
Even without price increases…
Polene’s competition is Longchamp at best.

 

[PDFSD]

^^
Can we compare Polene to Vuitton though? Or even any other brand on the LVMH portfolio except for Patou, Marc Jacobs or Kenzo.
Even without price increases…
Polene’s competition is Longchamp at best.

i think yes if the shift is:
i can get good design and quality i don't need that 2000k lv bag it can be a sign of bigger longer shift taking place.

years ago when Uniqlo was new to me in europe i would stop buying prada basic knits as uniqlo had the cashmere ones in all the basic colors i needed so prada lost me on that category, did not mean no more prada shoes or backpacks/luggage or suit pants, coats but far less knits at prada for sure ever since as other brands do clean knits for less now.

and if you know which factory does high end brands via friends info etc, it's even more a kick to get it from a less expensive brand that comes from same factory.