Richemont and Burberry signal that luxury market is thriving

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Demand for jewellery, timepieces and fashion items is rebounding as vaccination rates worldwide rise

Richemont had its fastest holiday-season sales growth in at least a decade and Burberry forecast 35% earnings growth this year, signalling that the luxury-goods market is thriving again.

Demand for jewellery, timepieces and fashion items is rebounding as vaccination rates across the world increase and people socialise and travel more. Prada said on Tuesday its sales recovered to above levels seen before the coronavirus pandemic. Jewellery was Richemont’s best-performing unit, though fashion, accessories and leather goods have also been improving, a sign that turnaround efforts have been gaining traction at brands such as Chloe and Montblanc.

China was the first market to recover in the luxury-goods industry, so it is a bit of a calendar effect. However, recent lockdowns as the country pursues its zero-Covid-19 strategy are set to weigh on consumption. Akeroyd’s predecessor, Marco Gobbetti, sought to make Burberry more premium by reducing third-party distribution as well as discounts to sell its Olympia handbags and tartan scarves at full prices. Those sales continued to grow at double-digit percentage from two years ago.

 

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