Boohoo Links Executive Bonuses to Supply Chain Issue Resolution

A woman poses with a smartphone showing the Boohoo app in front of the Boohoo logo on display in this illustration taken September 30, 2020. REUTERS/Dado Ruvic/Illustration

Asharq Al Awsat

10:15-20 May 2021 AD ـ 08 Shawwal 1442 AH

Asharq Al Awsat

10:15-20 May 2021 AD ـ 08 Shawwal 1442 AH

Boohoo Links Executive Bonuses to Supply Chain Issue Resolution

A woman poses with a smartphone showing the Boohoo app in front of the Boohoo logo on display in this illustration taken September 30, 2020. REUTERS/Dado Ruvic/Illustration

British online fashion retailer Boohoo (BOOH.L) has bowed to pressure from lawmakers to link multimillion pound bonuses for its executives to improvements in its supply chain, including workers' rights.

In September, Boohoo accepted the recommendations of an independent review which found major failings in its supply chain in England after newspaper allegations about working conditions and low pay, and set out steps to tackle the issues.

Boohoo, which sells clothing, shoes, accessories and beauty products targeted at 16- to 40-year-olds, has also faced investor criticism over a bonus scheme which would pay up to 150 million pounds ($213 million) to its founders and executives if its share price rises 66% over three years from June 2020, Reuters reported.

Co-founder and chairman Mahmud Kamani and co-founder Carol Kane could each be in line for 50 million pounds, Mahmud's son Samir, who is CEO of BoohooMan, could be in line for 25 million while finance chief Neil Catto could get 10 million pounds.

Parliament's Environmental Audit Committee (EAC) recommended the bonuses be linked to Environmental Social and Governance (ESG) improvements following an evidence session in December, attended virtually by Mahmud Kamani and other executives.

Boohoo has accepted that recommendation.

"Whilst we ultimately believe that the full resolution (or otherwise) of these (supply chain) issues will be reflected in long-term share price performance (and thus have an impact on the value of awards) we have also agreed with participants to add a new non-financial performance condition," Boohoo's annual report, published on Wednesday, said.

Under this new target, Boohoo's remuneration committee must be satisfied that the group's "Agenda for Change" program to fix supply chain issues has been successfully implemented over the three-year performance period before the vesting of any management incentive plan (MIP) awards.

The remuneration committee is made up of non-executive directors.

"In the event of the committee determining that the Agenda for Change program has not been successfully implemented in full, we will have the ability to reduce the level of vesting of awards, irrespective of the share price growth achieved over the performance period," the report said.

Shares in Boohoo were down 0.6% at 0743 GMT, valuing the company at 4 billion pounds.

Fashion

Hummingbirds and Hooves Take over the Red Carpet at Met Gala

US actress Zendaya arrives for the 2024 Met Gala at the Metropolitan Museum of Art on May 6, 2024, in New York. The Gala raises money for the Metropolitan Museum of Art's Costume Institute. The Gala's 2024 theme is “Sleeping Beauties: Reawakening Fashion.” (AFP)

10:42-7 May 2024 AD ـ 28 Shawwal 1445 AH

Hummingbirds and Hooves Take over the Red Carpet at Met Gala

From Bad Bunny's Tudor-inspired hat and shoes resembling cloven hooves to the hummingbird perched delicately on Zendaya's neck, the hosts set the tone at fashion's biggest night -- the annual Met Gala in New York.

Florals, animals and vintage couture abounded at the so-called Oscars of the East Coast, a mammoth fundraiser for the Metropolitan Museum of Art's Costume Institute.

The extravaganza's dress code this year is "The Garden of Time" -- which draws inspiration from the 1962 short story of the same name, written by English writer J.G. Ballard.

In essence, it is about the ephemeral nature of beauty -- perhaps a weighty theme to press on the luminaries attending this year's gala.

For sheer drama, co-host Zendaya dominated the green and cream carpet in her first appearance at the Met Gala since 2019.

The 27-year-old star made a highly-anticipated appearance early on wreathed in jewel-toned lame, organza and satin designed by John Galliano, with vines crawling up her duchess corset and arms -- and what appeared to be a hummingbird nestled into her neck.

Hours later she made a surprise second appearance -- this time in dramatic, Mexican Gothic-inspired black, her two outfits bookending the fashion parade and underscoring the transience of beauty.

Most attendees chose to evoke awakenings and life -- and perhaps defied the theme by demonstrating the immortality of fashion through the centuries, with many 17th and 18th century flourishes.

Some -- such as singer Lana del Rey -- emphasized decay, with stark sculptural twigs rising from her gown to hold a veil of tulle like a canopy over her head.

South African singer Tyla's strapless Balmain gown evoking the sands of time -- right down to the hourglass purse -- was sculpted so tightly to her body that she had to be carried up the steps at the Metropolitan Museum of Art.

Puerto Rican singer Bad Bunny evoked a kind of Tudor matador with a sweeping hat and a black bouquet, with the only pop of color his bright red inseam and the patent shine of his cloven shoes.

Cardi B was resplendent in funereal black, with a train so expansive it required nine tuxedoed men to lift it up the stairs.

"It's a black rose," she told journalists.

- 'Mysterious and unexpected' -

Celebrity interpretation of Met Gala themes have been wide-ranging and often sparked social media debate -- but attendees this year appeared to shrug off the pressure.

"I don't even think there's pressure at all, I think it's more of an opportunity," actor Colman Domingo, who carried a bouquet in a lily-colored caped jacket and wide-leg trousers, told journalists.

The theme parallels the exhibit "Sleeping Beauties: Reawakening Fashion," which focuses on the most fragile pieces of the Costume Institute's vast collection.

The show, which will be on view for the public from May 10 through September 2, features clothing so delicate it cannot be displayed on mannequins.

The Costume Institute relies on the blockbuster Met Gala to fund its work, including exhibitions and acquisitions.

The gala was first held in 1948 and for decades was reserved for New York high society. Vogue Editor-in-Chief Anna Wintour, the high priestess of US fashion, took over the show in the 1990s, transforming the party into a catwalk for the rich and famous.

This year, a ticket cost a cool $75,000, with tables starting at $350,000. The 2023 gala -- which celebrated the late designer Karl Lagerfeld -- raised nearly $22 million, a record sum.

But what exactly goes on inside is an enduring mystery.

"Something mysterious, I'm sure, and unexpected," actor Jeff Goldblum told journalists on the red carpet, dressed as a count swathed in Tiffany jewels.

Guests are likely to peruse the exhibit, and stars such as Rihanna -- whose command of the red carpet is usually unparalleled, but who did not appear at this year's gala -- have performed in the past.

- Social media frenzy -

The spectacle is social media catnip for celebrity watchers -- and once again this year, both the gala and the exhibit are co-sponsored by TikTok.

The tech world joined luminaries of music, film, politics and sports on the carpet, with TikTok CEO Shou Chew, also an honorary co-chair, in attendance.

Outside the event, several hundred protesters against the war in Gaza demonstrated nearby, with security tight and several arrests made as stars walked the red carpet.

Fashion

Online Retailer Zalando Grows Marketplace, Customer Numbers Fall

FILED - 03 March 2021, Berlin: The logo of online retailer Zalando is pictured on the Zalando Campus at Mercedes-Platz in Berlin. Photo: Jens Kalaene/ZB/dpa

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08:03-7 May 2024 AD ـ 28 Shawwal 1445 AH

Asharq Al Awsat

08:03-7 May 2024 AD ـ 28 Shawwal 1445 AH

Online Retailer Zalando Grows Marketplace, Customer Numbers Fall

FILED - 03 March 2021, Berlin: The logo of online retailer Zalando is pictured on the Zalando Campus at Mercedes-Platz in Berlin. Photo: Jens Kalaene/ZB/dpa

Zalando swung to growth in the first quarter after three consecutive declines in gross merchandise volume, the online retailer said on Tuesday, but a decline in active customers and orders dampened the online retailer's results.
Quarterly gross merchandise volume (GMV) - a key revenue metric measuring the total value of all goods sold - rose 1.3% to 3.27 billion euros ($3.52 billion) from 3.23 billion in the year-earlier period, the German online fashion retailer said.
But analysts focused on a decline in active customers to 49.5 million from 51.2 million a year prior, and a 0.6% dip in quarterly revenue, Reuters reported.
As inflation has dented consumers' appetite to buy clothes, Zalando has sought new revenue drivers and started offering its platform and logistics network as a service to other retailers and brands. Revenue from this business-to-business (B2B) service was up 13% at 215 million euros.
"As we are executing our ecosystem strategy, we are excited by the positive response from customers and partners in the first quarter. We are returning to growth," said Dr. Sandra Dembeck, Zalando's chief financial officer.
Along with weaker demand, increased competition by fast fashion rivals such as Shein have weighed on Zalando's revenue. In response, Zalando is adding more premium brands to pursue a bigger share of customers' wallets, rather than trying to compete on price with Shein, which sells $5 T-shirts and $10 shoes.
Zalando said its average basket size increased to 60.4 euros, from 57.3 euros a year earlier.
Zalando has also developed a tool to predict sizing based on photos submitted by customers, and said it launched the service in Spain, France and Italy in the first quarter. The tool aims to ensure customers order items in the correct size, to reduce the amount of returns, a key threat to profit for Zalando and other online retailers.
Adjusted earnings before interest and tax (EBIT) swung to a profit of 28.3 million euros from a loss of 0.7 million euros a year earlier.
The company confirmed its outlook for GMV and revenue to grow as much as 5% in 2024, and adjusted EBIT to be 380 million to 450 million euros.

Fashion

Saudi Fashion Commission Announces Grand Opening of ‘The Lab' in Misk City

The Saudi Fashion Commission will unveil Tuesday “The Lab”, an initiative demonstrating a monumental shift in the local fashion industry. (SPA)

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06:23-7 May 2024 AD ـ 28 Shawwal 1445 AH

Asharq Al Awsat

06:23-7 May 2024 AD ـ 28 Shawwal 1445 AH

Saudi Fashion Commission Announces Grand Opening of ‘The Lab' in Misk City

The Saudi Fashion Commission will unveil Tuesday “The Lab”, an initiative demonstrating a monumental shift in the local fashion industry. (SPA)

The Saudi Fashion Commission is excited to unveil Tuesday “The Lab,” the first of its kind in the Kingdom, a state-of-the-art product development studio that is poised to revolutionize the fashion manufacturing landscape in Saudi Arabia, the Saudi Press Agency said.
Located at The City Hub in Mohammed bin Salman Nonprofit City (Misk City), The Lab is a flagship initiative demonstrating a monumental shift in the local fashion industry. It reflects the commission's commitment to elevating manufacturing capabilities and fostering innovation within the Kingdom.
By providing cutting-edge manufacturing facilities, The Lab enables local designers, brands, and fashion entrepreneurs to actualize their creative visions, proudly under the “Made in Riyadh” label.
The grand opening of The Lab represents a pivotal moment for the Saudi fashion sector, signaling new opportunities for growth, collaboration, and global competitiveness. Attendees will experience firsthand the advanced technologies and collaborative environment that The Lab offers, marking a significant step towards achieving a vibrant and sustainable fashion industry in Saudi Arabia.
“The Lab showcases the groundbreaking advancement in Saudi Arabia's fashion industry,” said Saudi Fashion Commission CEO Burak Cakmak. “As the premier facility of its kind in the region, located in the heart of Riyadh, it streamlines the manufacturing process, empowering our local designers and brands to effortlessly realize their creative visions. By nurturing innovation and providing essential support throughout the fashion cycle, we not only foster creativity but also champion sustainable practices within the industry. The establishment of The Lab, a local product development studio, exemplifies our profound commitment to cultivating a thriving fashion ecosystem right here in Saudi Arabia.”
“The opening of The Lab at Misk City marks a significant milestone for the fashion industry in Saudi Arabia,” said Misk City CEO David Henry. “This state-of-the-art product development studio will not only revolutionize fashion in the Kingdom but also empower local designers and entrepreneurs to showcase their creativity on a global stage, especially since Misk City will contribute significantly to promoting distinguished national brands in the field of fashion in addition to supporting local companies. We are proud to be part of this transformative project and look forward to seeing the positive impact it will have on the industry.”
The partnership will enable enhanced cooperation between both entities to develop education and training programs for young Saudi designers, explore opportunities for incubation of entrepreneurs, and attract talent and investors to the Kingdom’s fashion sector. The partnership also lays the foundation for cooperation in hosting various fashion-related events and festivals at Misk City.
Esteemed members of the fashion industry, media, and government representatives are anticipated to attend Tuesday, highlighting the broad support for this transformative project in inaugurating the space. The event will showcase local fashion talents and demonstrate the potential housed within this innovative facility.
The Saudi Fashion Commission invites practitioners, brand owners, and designers in the fashion industry to join this historically exceptional space to be part of the dawn of a new era in fashion manufacturing. It aims to develop the fashion sector in Saudi Arabia through strategic initiatives that fosters innovation and talents, promote economic diversification, and enhance cultural exchange.

Fashion

Red Sea Fashion Week Makes Its Debut in May 2024

17:28-6 May 2024 AD ـ 27 Shawwal 1445 AH

Red Sea Fashion Week Makes Its Debut in May 2024

The inaugural edition of the Red Sea Fashion Week, an initiative by the Saudi Fashion Commission, will be held from May 16 to 18 at the brand-new St. Regis Red Sea Resort development in Saudi Arabia.

The three-day event will kick off with an opening show, followed by two days of runway shows and activations, featuring luxury fashion, jewellery, Ready-to-Wear, and Resort Wear collections from both Saudi and international designers.

A pivotal moment for Saudi Arabia's fashion industry and its integration into the global market, Red Sea Fashion Week is strategically aligned with the objectives of Vision 2030 to diversify the economy and develop cultural sectors.

By showcasing local talent and facilitating connections with international buyers and media, the event underscores Saudi Arabia's commitment to becoming a hub for luxury fashion and cultural exchange.

Chief Executive Officer of the Saudi Fashion Commission Burak Cakmak stated: “With Red Sea Fashion Week, we set out to forge a distinctive and dynamic platform that not only highlights the vast creativity and skill within Saudi Arabia but also elevates our nation as a key player on the global fashion stage.”

“This initiative is a vibrant testament to our dedication to cultivating local talent and integrating them into the international arena, resonating deeply with the Kingdom's Vision 2030 goals of enriching our cultural fabric and broadening our economic horizons,” he added.

The inaugural Red Sea Fashion Week represents a significant step in Saudi Arabia's journey to redefine the fashion landscape and celebrate its diverse cultural heritage. Fostering a dynamic fashion community with global appeal, the Saudi Fashion Commission aims to propel the creative economy and establish the Kingdom as an international fashion destination.

Fashion

It's (Almost) Met Gala Time. Here's How to Watch Fashion's Big Night and What to Know

FILE - Zendaya attends The Metropolitan Museum of Art’s Costume Institute benefit gala celebrating the opening of the “Camp: Notes on Fashion” exhibition on May 6, 2019, in New York. (Photo by Evan Agostini/Invision/AP, File) (Evan Agostini / Evan Agostini/invision/ap)

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06:46-6 May 2024 AD ـ 27 Shawwal 1445 AH

Asharq Al Awsat

06:46-6 May 2024 AD ـ 27 Shawwal 1445 AH

It's (Almost) Met Gala Time. Here's How to Watch Fashion's Big Night and What to Know

Attention all you fashionistas: It's Met Gala time. Yes, the first Monday in May is upon us.
Looking to follow along? Here's a quick primer on what you need to know about the palooza of A-list celebrities from film, fashion, music, sports, politics and social media.
That's tricky. Vogue has the exclusive livestream, which starts at 6 p.m. Eastern at Vogue.com. The feed will also be available on Vogue's digital platforms, including TikTok and YouTube.
Tons of other media will be on site, too. Catch the action on E!, also starting at 6 p.m., with livestreams on X, TikTok, Instagram and Peacock.
The Associated Press will be live outside the Mark Hotel, where many celebs get ready before heading to The Metropolitan Museum of Art for their walk up the grand staircase. That livestream will begin at 4:45 p.m. Eastern and will be available on YouTube and APNews.com.
Only the event's stacked red carpet is watchable - the gala's cocktail hour and dinner are notoriously private events.
It's a party, for sure, with cocktails and dinner for about 400 guests, but it's also a huge fundraiser for the Met's Costume Institute, the only department at the museum required to pay for itself. Last year, the gala raised about $22 million. Anna Wintour, a Met trustee for whom part of the institute has been renamed, organizes the whole shebang. No phones are allowed, adding to the allure.
There's a dress code each year tied to the museum's spring exhibition. Some guests, not all, step up at the request of Wintour. This year's theme is "The Garden of Time," inspired by J.G. Ballard's 1962 short story of the same name. It's a squishy fashion ask considering how specific last year's theme was: all things Karl Lagerfeld. Florals, and more florals, are expected this time around. Vintage will likely be big, too.
It's called "Sleeping Beauties: Reawakening Fashion." But we're not talking fairytales or Disney princesses. It includes 250 items from The Costume Institute´s permanent collection, including some garments very rarely seen in public and so fragile they need to be under glass. Curators wanted to engage all the senses, including that of smell. They worked with a "smell artist." And there's a garment that actually grows. Part of the idea is to pay tribute to the natural world. The exhibit opens to the public Friday and runs through Sept. 2.
Getting called up by Wintour as a co-chair is a big deal. This year's class is Zendaya, Jennifer Lopez, Bad Bunny and Chris Hemsworth. It's Hemsworth's first Met Gala. Shou Chew, chief executive officer of TikTok, and Jonathan Anderson, creative director of Loewe, are honorary chairs. The companies are also gala and exhibition sponsors.
Who attends is top secret but Rihanna has spilled she'll be there. She'll likely be accompanied by her partner A$AP Rocky. Other high-profile partners likely to attend, because their significant others are hosting: Ben Affleck and Tom Holland. Lily Gladstone has said she´ll attend. Who we want to see: Ayo Edebiri.Taylor Swift is looking like a no, and her boyfriend Travis Kelce will definitely not be there. Dua Lipa is going.

Fashion

Spain's Fashion and Beauty Group Puig Poised for IPO

Puig Group owns the Paco Rabanne, Nina Ricci, Charlotte Tilbury and Carolina Herrera labels and also holds a majority stake in Jean Paul Gaultier. FRANCOIS GUILLOT / AFP/File

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10:20-3 May 2024 AD ـ 24 Shawwal 1445 AH

Asharq Al Awsat

10:20-3 May 2024 AD ـ 24 Shawwal 1445 AH

Spain's Fashion and Beauty Group Puig Poised for IPO

Puig Group owns the Paco Rabanne, Nina Ricci, Charlotte Tilbury and Carolina Herrera labels and also holds a majority stake in Jean Paul Gaultier. FRANCOIS GUILLOT / AFP/File

The iconic Nina Ricci, Paco Rabanne and Jean-Paul Gaultier labels make their market debut Friday as Spanish fashion and beauty group Puig begins trading on the Madrid stock exchange.
For the family-owned Puig Group, which has expanded rapidly into luxury goods, going public is a big step which will allow it to compete with the giants of the sector such as Estee Lauder, Hermes, Kering and LVMH.
The move "is a decisive step in Puig's 110-year history," chairman and CEO Marc Puig said last month, emphasizing the firm's "long-term approach".
Founded in Barcelona in 1914 by businessman Antonio Puig Castello, the group has grown over the years to become a heavyweight in the cosmetics, fragrance and fashion industries, bolstering its stance in recent years with a string of prestigious acquisitions.
Among its brands are Paco Rabanne, Nina Ricci, Charlotte Tilbury, Carolina Herrera and Dries Van Noten. It also holds a majority stake in the Jean Paul Gaultier label and has licensing agreements with Prada, Christian Louboutin and Comme des Garçons.
A family firm
The Barcelona-based group, which specializes in perfumes and cosmetics, enters the market on Friday with an opening guidance price of 24.50 euros (about $26) per share.
Analysts said it was Spain's biggest IPO this year and one of the largest in Europe.
The price gives the group an estimated market capitalization of nearly 14 billion euros, which will allow it to enter Madrid's Ibex 35 exchange, which groups Spain's 35 largest companies.
The flotation will take place in two stages, the first of which would seek to raise an initial 1.25 billion euros through newly issued shares.
It would then make a "larger secondary offering" of existing shares held by its holding company Exea to raise nearly 1.36 billion euros.
That could then be complemented with the sale of shares reserved for specific investors for another 390 million euros, which would allow the group to raise around 3.0 billion euros.
Despite the move, the Puig family said it would retain a controlling interest in the company with 71.7 percent of the shares, along with "the vast majority of voting rights" -- 92.5 percent -- within the board of directors.
'Greater financial clout'
The idea of an IPO had first been raised by Puig himself in an interview with the Financial Times in October 2023, in which he said being accountable to the market would bring "a discipline" that would head off any issues when passing the baton from one generation to the next.
"Sometimes family businesses can lose their position in the market. They can start to die slowly and nobody inside the company is aware of it," he told the paper. "If you’re accountable (to investors), those things can be noticed."
According to Javier Cabrera, an analyst at XTB, the IPO would allow the group to build "greater financial clout" by taking advantage of "the positive stock market dynamics" in the luxury goods and fashion sector.
Luxury goods are enjoying a buoyant moment with sector heavyweights posting record sales in 2023, despite a slowdown following two years of double-digit growth.
Last year, Puig posted sales of 4.3 billion euros, a 19 percent increase on 2022, logging net profits of 465 million euros, up 16 percent year-on-year.
And that growth could gather pace thanks to Puig's strategy of acquisitions, which in recent years has led to "a high level of growth" and "a good diversification of revenues, both geographically and in terms of business lines", Cabrera said.
He also pointed to the group's strong showing in China, a major consumer of luxury goods.

Fashion

Luxury Brands Lure Chinese Shoppers despite Slowdown

Louis Vuitton described its 'Voyager' show in Shanghai last month as the 'next chapter in a strong, longstanding relationship' with China. Hector RETAMAL / AFP

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06:58-3 May 2024 AD ـ 24 Shawwal 1445 AH

Asharq Al Awsat

06:58-3 May 2024 AD ـ 24 Shawwal 1445 AH

Luxury Brands Lure Chinese Shoppers despite Slowdown

Louis Vuitton described its 'Voyager' show in Shanghai last month as the 'next chapter in a strong, longstanding relationship' with China. Hector RETAMAL / AFP

Sipping champagne and nibbling fried dumplings, Shanghai's rich and influential posed by Louis Vuitton signs at a runway afterparty –- a lavish affair designed to win customers in China's crucial market.
China is the world's biggest spender in the luxury sector, accounting for half of global sales. But as its post-pandemic recovery falters, consumption has flagged, sending jitters through the industry.
For years, wealthy Chinese tourists had traveled to Europe to shop at its boutiques, but when the Covid-19 pandemic struck, the country introduced draconian restrictions that stopped them from leaving the country.
The measures also threw the world's second largest economy into a slowdown that it is struggling to recover from, with consumer confidence hit and attitudes towards high-end purchases starting to shift.
Now, as China emerges from its coronavirus haze, luxury brands are trying to woo its shoppers back.
Shares in Gucci owner Kering tumbled in April after it reported sales in the first quarter had fallen by 11 percent, citing tough market conditions in China.
"Gucci will... not be alone here as other brands have also been feeling the pinch from China's domestic spending," Fflur Roberts, head of luxury at Euromonitor International, told AFP.
Brands with a strong presence in China like Louis Vuitton are staging special events and handing out perks to VICs –- an acronym for Very Important Clients.
Louis Vuitton described its "Voyager" show in Shanghai last month as the "next chapter in a strong, longstanding relationship" with China.
Its leading pieces –- boldly colored dresses marked with large cartoon-like animals -– were a collaboration with contemporary Chinese artist Sun Yitian, with the brand hailing "the tremendous stylistic vitality" of the country's youth.
Hollywood A-listers Cate Blanchett and Jennifer Connelly strode down the runway to their seats before the show began, as did Chinese megastars and brand ambassadors Liu Yifei and Jackson Wang.
At the afterparty, influencers and VICs, many dressed head-to-toe in Louis Vuitton, mingled under flashing neon street signs, sampling fancified Chinese street food from stalls bedecked with the brand's logo.
'More cautious consumers'
Louis Vuitton's parent company LVMH is among the fashion houses so far proving fairly resilient in the face of China's economic headwinds.
While its first quarter results showed its slowest rate of growth in years, the brand said that sales to domestic and overseas Chinese customers increased by about 10 percent.
Prada and Hermes's first quarter results both beat analysts' expectations, posting 18 and 17 percent rises in sales, respectively.
Overall, however, the market has slowed down, with consultancy firm Bain & Company forecasting single-digit growth in the Chinese luxury market in 2024 compared to 12 percent last year.
"The economic downturn is impacting Chinese luxury consumers' confidence," said Lisa Nan, correspondent for Jing Daily, which reports on the Chinese luxury sector.
"We are facing much more cautious and value-driven consumers, that also check the handbag's second-hand market value before making a purchase."
Travel, not bags
Post-pandemic, there has also been a shift in consumer tastes and priorities.
Near Shanghai's Wukang Mansion, a landmark regularly swarmed by influencers, a woman surnamed Liu said that while she occasionally bought designer items, she would never go line up for a bag.
"I like traveling a bit more," she said. "I'm not so crazy about brand names."
That's a trend evident in a report on high net-worth individuals' preferences compiled by research firm Hurun.
"There is a significant shift towards experiential luxury rather than luxury goods," said Nan of Jing Daily.
During the pandemic, the absence of high-spending Chinese tourists hit Europe's luxury goods sector hard.
Some of that spending transferred to China, as global brands focused on organizing events and creating goods more tailored to their biggest market.
Euromonitor International's Roberts said the outlook for the luxury market remained "challenging", and that brands should "err on the side of caution".
"That said, China is still home to over 2.5 million people with a net wealth over $1 million," she added.
On a sunny day in central Shanghai, passers-by clutched their designer handbags as they went shopping.
"Some people say that if you buy classic styles, they may appreciate in value and it can be an investment," said a 28-year-old media worker named Winnie carrying a Dior bag.
"But for me... it's not an investment. As long as I like it, it's fine."
"I think China is still in a period where (European) brands are important," Jennifer Sheng, a woman in her 60s, told AFP.
In her eyes, the allure of owning designer products remained strong.
"Twenty years, thirty years ago, we didn't have anything," Sheng said.
"We want to have these things."

Fashion

Hugo Boss Beats Q1 Operating Profit Expectations

The logo of German fashion house Hugo Boss is seen on a clothing label at their outlet store in Mezingen near Stuttgart October 29, 2013. (Reuters)

08:50-2 May 2024 AD ـ 23 Shawwal 1445 AH

Hugo Boss Beats Q1 Operating Profit Expectations

The logo of German fashion house Hugo Boss is seen on a clothing label at their outlet store in Mezingen near Stuttgart October 29, 2013. (Reuters)

Hugo Boss' first-quarter operating profit on Thursday beat expectations despite further investment into the business helped by efficiencies and improving costs.

Earnings before interest and taxes rose 6% to 69 million euros ($74 million), slightly above the 65 million in a company-provided poll of analysts.

Efficiency gains in sourcing as well as more favorable product and freight costs offset promotion costs and negative currency effects, the company said.

Quarterly group sales rose 5% to 1.01 billion euros.

Brand and product initiatives including the launch of the latest spring/summer 2024 collection drove growth for its BOSS and HUGO brands in the quarter, the company said.

Fashion

Pandora Raises Revenue Forecast as US Sales Sparkle

People pass a shop of the Danish jewellery maker Pandora in central Copenhagen, Denmark February 6, 2024. (Reuters)

08:44-2 May 2024 AD ـ 23 Shawwal 1445 AH

Pandora Raises Revenue Forecast as US Sales Sparkle

People pass a shop of the Danish jewellery maker Pandora in central Copenhagen, Denmark February 6, 2024. (Reuters)

Pandora, the world's largest jewellery maker, raised its full-year revenue guidance on Thursday after beating first quarter sales and profit forecasts as it won market share in the United States, its biggest market.

The Danish company's shares jumped 5% in early trading.

Pandora has invested heavily in marketing, store openings, and broadening its range of rings, necklaces, and lab-grown diamonds, though its charm bracelets ranging from $60 to more than $2,000 still make up around 60-70% of sales.

Sales jumped 11% in the first quarter to 6.8 billion Danish crowns ($977.8 million), including a 9% increase in the United States, where the brand is gaining market share even as overall demand for jewellery has weakened.

"The reason we are gaining share fundamentally is because we keep investing in this brand," CEO Alexander Lacik told Reuters in an interview. "Even when there is a shrinking pie, you will find winners and losers."

Operating profit rose to 1.51 billion crowns from 1.26 billion a year earlier, compared with 1.32 billion expected by analysts polled by the company.

Pandora now expects organic revenue growth of 8%-10% this year, compared with 6%-9% previously. It kept its operating margin guidance at around 25%.

Charm bracelets, a staple of 90s fashion, have enjoyed a renaissance, trending on social media platforms like TikTok.

Lacik said social media contributed to Pandora's growth but was not the underlying driver.

"This is a result of the overarching program that Pandora has been working on for many years now, and I think maybe we've hit a sweet spot with the type of audience that we're trying to serve," Lacik said.

In North America, Pandora's expansion into lab-grown diamond jewellery piqued shoppers' interest and increased their demand for the whole range of Pandora products, the company said.

China was a weak spot with sales down 17% in like-for-like terms, which Pandora blamed on a challenging market as it works to relaunch the brand there.

Fashion

Estee Lauder Tempers Sales View despite US, China Recovery

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)

17:26-1 May 2024 AD ـ 22 Shawwal 1445 AH

Estee Lauder Tempers Sales View despite US, China Recovery

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)

Estee Lauder lowered its annual organic sales estimate on persistent softness in mainland China's prestige beauty space, even as a demand rebound for its pricey items in the US and Asia-Pacific markets drove a profit forecast raise.

Shares of the New York-based company dropped nearly 10% on Wednesday.

Estee also beat third-quarter results expectations, hinting at a recovery in demand for beauty and cosmetic products in the US after a long bout of inflation had pressured sales of luxury items in the world's biggest economy.

A pick-up in China and Asia travel retail demand after several quarters of weakness underscored customer willingness to splurge on "affordable luxuries" such as fragrances and make-up products.

Third-quarter organic net sales in the Americas grew 1%, with a 3% rise in the Asia Pacific region.

"We see actual progress in the total Chinese consumer consumption on our brands and they are very solid," said CEO Fabrizio Freda, adding that the number of Chinese travelers are growing too.

However, Estee forecast annual organic sales would fall 1% to 2%, compared with its previous estimate of a 1% decrease to a 1% increase.

"Estee Lauder's management might have taken the view it is better to be cautious now and over-deliver than continue with high expectations and fail to sell enough products," said Dan Coatsworth, investment analyst at AJ Bell.

The company expects full-year 2024 adjusted profit per share between $2.14 and $2.24, compared with a prior forecast of $2.08 to $2.23.

Net sales rose 5% to $3.94 billion, compared with LSEG estimates of $3.91 billion. Adjusted profit of 97 cents per share surpassed expectations of 49 cents.

Last month, European rival L'Oreal also beat sales expectations and eased concerns about waning demand in the US and China - the two biggest beauty markets.

"The sector has held better than I expected and the question really around luxury and personal luxury goods is whether 2024 will be a hard or soft landing ... so far it speaks to the narrative of a soft landing," said Javier Gonzalez Lastra, luxury-focused portfolio manager at Tema ETFs.

Boohoo Links Executive Bonuses to Supply Chain Issue Resolution

Boohoo Links Executive Bonuses to Supply Chain Issue Resolution

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