French fashion brand may limit single customer purchases amid rising demand fashion trends

Chanel could double purchase limits on its quilted classic flap handbags on other high-end products and in more countries, the French brand told Reuters, as luxury houses tighten their grip on distribution amid rising demand.

When asked about a report on the Persebop website, Philippe Blondeaux, the channel’s chief financial officer, said in an interview, “We sometimes have to limit the number of items a customer can buy.” – which can cost $10,000 each.

Blondeax said the limits, which would not be imposed globally, were intended to protect customers and curb bulk purchases.

Analysts say Chanel is looking to make its brand more distinctive, and is also trying to counter the boom in the resale market for luxury goods.

“It can be applied to certain product categories – not just flap bags – it can affect some items that are in hot demand and luckily, or unfortunately, Chanel has quite a few, so it’s that kind of remedy. Which we could have applied several times in different countries,” Blondiaks said.

The company is already limiting purchases of the famed handbag to South Korea, where long queues outside a Seoul department store can take place before dawn as shoppers are exposed to what’s known as an “open run” – opening times for Chanel. A sprint at the door.

Some resellers have told Reuters they were hiring “line standers” for up to $125 a day to queue or enter stores on their behalf.

The potentially wide use of the purchase limit comes amid an industry campaign for exclusivity, with Chanel repeatedly raising prices for its handbags during the pandemic. The group says it also aims to reduce the price differential between different regions.

Following the latest increase in March, the fourth since early 2021, some of Chanel’s signature handbags — including classic flaps in some cases — now cost up to twice what they did in 2019.

LVMH-owned Louis Vuitton and Kering’s Gucci are also increasing prices to protect margins and, more recently, to counter rising costs of transportation, logistics and raw materials.

Blondiax said the channel could impose further increases in July due to currency volatility – particularly the weakness of the euro – and inflation.

High-end fashion and jewelry brands have so far seen little impact from rising cost of living, with strong, local demand making up for the lack of global tourism, the industry’s traditional growth driver.

According to Blondiaks, restricting purchases could be a “short-term disappointment” for some customers, they understand overall.

The executive also said that the 300-euro limit for sales to customers whose principal residence is Russia was implemented to comply with international sanctions.

“These restrictions say that you cannot sell an item that may be for use in Russia, whether you sell it to a Russian customer, a French customer or a US customer,” Blondiaks said. “Measures are a reflection of what the law compels us to do, nothing more.”

Angry Russian influencers have been seen chopping off Chanel handbags in protest on social media.

Luxury department store Harrods recently took a similar move, when Britain banned the export of luxury goods to Russia with a price tag of more than £300.

Blondiaks said Chanel has temporarily closed 17 of its boutiques in Russia, but continues to pay employees there and hopes to resume business in the long run.

The group says it is confident of another year of solid growth in 2022, despite declining sales in China due to a new round of lockdowns since March. The channel reported revenue of $15.6 billion for 2021, a 49.6% increase over the previous year.

This story has been published without modification in text from a wire agency feed. Only the title has been changed.

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