Chanel Increases Prices Again in Europe and Asia

Chanel bags and creations are displayed on mannequins in a window of a fashion house Chanel store in Paris, France, June 18, 2020. (Reuters)
Chanel bags and creations are displayed on mannequins in a window of a fashion house Chanel store in Paris, France, June 18, 2020. (Reuters)
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Chanel Increases Prices Again in Europe and Asia

Chanel bags and creations are displayed on mannequins in a window of a fashion house Chanel store in Paris, France, June 18, 2020. (Reuters)
Chanel bags and creations are displayed on mannequins in a window of a fashion house Chanel store in Paris, France, June 18, 2020. (Reuters)

French luxury group Chanel has again increased prices on some of its products, after three price hikes in 2021, meaning some of its signature handbags now cost up to twice what they did before the pandemic in 2019.

Major luxury brands have raised prices throughout the coronavirus emergency to protect margins and, more recently, to counter rising costs of transport, logistics and raw materials. But Chanel has been more aggressive than rivals, in a move that analysts say also aims to increase the exclusivity of the brand.

Its small classic handbag cost 7,750 euros ($8,454) on Chanel's French website on Friday, 6% more than in November last year. The same bag sold for 5,500 euros in January 2021 and 4,550 euros in November 2019.

According to analysts at Jefferies, Chanel has hiked prices of its iconic handbags by an average of 71% since before the pandemic. In Hong Kong, the small classic handbag now costs 96% more than at the end of 2019.

Chanel said in a statement: "What has been implemented yesterday is not a price increase, but a harmonization of the prices of our entire in-store offer, a principle we have been applying since 2015 and which aims to avoid excessive price disparities between the markets where we are present."

A spokesperson confirmed that prices on its core handbags and accessories and seasonal ready-to-wear rose on Thursday by 6% percent in the euro zone, 5% in Britain, 5% in South Korea, 8% in Japan and 2% in Hong Kong. Prices remained unchanged in China and the United States.

Jefferies said the price differential for Chanel handbags between China - where prices remained unchanged - and Europe had fallen below 10% after Thursday's price move, compared to 30-40% for most luxury brands.



H&M First-quarter Sales Weaker Than Expected

A woman is reflected next to the logo of the H&M fashion retailer in the Mall of Berlin shopping center in Berlin, Germany, in this September 25, 2014 file photo. REUTERS/Thomas Peter
A woman is reflected next to the logo of the H&M fashion retailer in the Mall of Berlin shopping center in Berlin, Germany, in this September 25, 2014 file photo. REUTERS/Thomas Peter
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H&M First-quarter Sales Weaker Than Expected

A woman is reflected next to the logo of the H&M fashion retailer in the Mall of Berlin shopping center in Berlin, Germany, in this September 25, 2014 file photo. REUTERS/Thomas Peter
A woman is reflected next to the logo of the H&M fashion retailer in the Mall of Berlin shopping center in Berlin, Germany, in this September 25, 2014 file photo. REUTERS/Thomas Peter

Swedish fast-fashion retailer H&M reported weaker than expected sales for its first quarter on Thursday and said sales were up 1% so far in March, in a sign of a slow start to its spring and summer season.
H&M reported sales of 55.3 billion Swedish crowns ($5.52 billion) for the December to February quarter, missing analysts' mean estimate of 55.9 billion Swedish crowns, Reuters said.
"Our sales and earnings in the quarter were somewhat weaker than planned – but the first quarter is the smallest quarter of the year for us in terms of sales and margin, and we are confident going forward," CEO Daniel Erver said in a statement.
Increased discounting and marketing investments impacted H&M's profitability in the quarter, the company said, with the operating profit margin falling to 2.2% from 3.9% in the same period a year ago.
Erver, leading H&M for just over a year, is trying to turn its fortunes around and has ramped up marketing, spending on pop stars like Charli XCX to model its collections as he tries to make the brand more desirable and better compete against Zara and Shein.