
Not for sale: Luxury groups ponder ways to get rid of their unsold inventory - edward
https://www.economist.com/business/2020/01/30/luxury-groups-ponder-ways-to-get-rid-of-their-unsold-inventory
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supernova87a
This is just my personal philosophy:

If an item for sale could be counterfeited and sold to me at full price (or 5%
of the real item's price), and I would never know the difference, I probably
have no business buying the brand value of it.

If something's value can fluctuate so wildly, and even end up in a trash bin
because it can't sell, I'm probably not going to believe that it's something
worth me buying.

Maybe I never get to enjoy those luxury watches or backpacks that everyone's
wearing (whose point only seems to be the white name patch in the corner), but
equally, I never get pulled into buying something that I regret and wonder if
it was worth it (or genuine) later.

~~~
postsantum
You buy it for others, not for yourself. As long as you're playing status
games at certain circles, these things are useful to signal your wealth to
people who care

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adaisadais
In a previous life I was in the men’s middle tier luxury business. We would go
to clothing shows (Javits) in Manhattan. Multiple shoe companies would present
a shoe to us that had a “Gucci sole, leather, just no buckle” or a sweater
“milled in the same factory that YSL uses” all at a fraction of the price.

Luxury typically today just means logo. Very rarely is a garment worth the 10x
markup just because it has a LV or Gucci stamp.

I do think bespoke suits and certain fabrics are worth their ostentatious
price points but to your average consumer they just want the brand.

To some extent it’s the same in all industries particularly the computer
industry.

~~~
pottertheotter
This is why I hate buying clothing/accessories that have a logo on it. Not
because I don't want to have a logo showing, but because I feel like I'm
paying so I can have that logo.

The nice thing about men's fashion is that there seem to be more staples that
are timeless than there are in women's fashion. There are wide swings in
women's fashion, but if I buy right, I can get away wearing something for
years and it isn't dated.

~~~
moneywoes
What would you say are some staples in men's fashion? Grey crewneck?

~~~
adaisadais
Well the most timeless staple is really a principle: fit. When you buy
clothing that fits you will (almost) always look better than the average bear.

Good staples to look for / own:

-denim trousers -white and blue dress, oxford, and tee shirts -deep navy blazer (no gold buttons) -mid or dark charcoal grey suit with some depth to it -dark brown cap-toe shoes (with a belt in the same color family) -navy, black, or grey wool sweater

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reustle
This reminds me of this video of hundreds of $5,000 Gibson guitars being
destroyed. Quite sad to see such wasteful practices.

[https://www.youtube.com/watch?v=dSs_qxnJcVY](https://www.youtube.com/watch?v=dSs_qxnJcVY)

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dboreham
The article mentions discount "designer" outlets in the UK. These exist in the
USA too, but seem to be (deliberately?) hard to find. E.g. a Google search for
"Prada outlet" won't produce useful results. I've been to the one in Palm
Springs where family found some quite significantly discounted product at
Prada, Burberry, Gucci:

[https://www.premiumoutlets.com/outlet/desert-
hills/stores/pr...](https://www.premiumoutlets.com/outlet/desert-
hills/stores/prada)

~~~
iscoelho
Outlet stores really have limited inventory and that is shown if you've ever
compared a Gucci/Prada outlet store to a retail store.

Outside of generic items, you will rarely find any gems and also: the more
expensive the brand, the more behind the season the outlet store is. They are
really not the same as retail stores.

The outlet discount for those brands also rarely exceeds 50%. For some items,
it doesn't even exceed 20-30%.

~~~
jrs235
A lot of outlet stores have garments produced specifically for them. They
never appear in the retail stores. The garments are produced with lower
quality materials and lower quality controls and standards in order to keep
the selling price point lower.

Edit: The garment producers are basically just paying for licensing of the
brand name and slapping a label on them.

~~~
bsanr2
I wonder how much of this is true and how much of it is face-saving ops for
any given party. It must be difficult to know for sure unless you're part of
the supply chain.

~~~
mns
There was a documentary on a German public network where they investigated
this and lab tested the garments and the quality of materials from the exact
same brand from the flagship stores in the city vs the outlet products. Not
all of the brands did this, but a lot of them used outlets to get rid of poor
quality stuff, experimental product lines and a lot of low quality garments.
In some cases, for Levi for example, they had a lot of styles that you could
not even find in the normal retail stores.

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flyGuyOnTheSly
This horrible trait of capitalism does not only apply to high end expensive
luxury items, unfortunately.

I frequent a thrift store chain called Value Village (aka Savers in USA) quite
a bit. So much so that I regularly talk to a lot of the employees in the few
that I visit more often. And I love looking at the hoards of books they have
on hand at all times.

One day an employee was shuffling books around, taking the older books that
hadn't sold in a few months off the shelf.

I asked her what was done with those books, and she admit that they end up in
the trash.

Those books didn't cost them a penny. They were all donated for free.

Instead of giving them away or lowering the price below their $2/book minimum
they choose to dispose of them at the dump.

That makes perfect sense from a business standpoint, and zero sense from a
human standpoint.

There are hoards of extremely impoverished families where I live. The schools
are rotting from the inside out.

I imagine either of those groups would gladly take a few free books for their
children to read.

Other more human thrift stores in the area offer books for as little as 25
cents each, and they go in the "free" bin if they haven't sold at that price
after a few months but at that price they go quickly no matter the book or
condition so it's a moot point.

~~~
whatsmyusername
TBF humanity probably has an overabundance of Dan Brown, Left Behind, and The
Davinci Code copies.

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IAmGraydon
Can’t these brands improve the efficiency of their manufacturing chain so they
can scale production with demand and not hold so much inventory? How about
using machine learning to more accurately predict how much inventory is
necessary?

~~~
tgtweak
The inventory is usually in retail locations when sold. I can't remember
seeing anything in a luxury brand showroom (typically very limited catalogue
also) that wasn't in stock. Buyers in this segment don't want to order and
wait for it. This makes it difficult to do just-in-time production. Some is
artisan produced (luxury watches being one).

Machine learning has yet crack the code on what brand new high fashion style
will sell best a season in advance when it is typically manufactured.

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bcardarella
"Other than slashing prices"

good luck

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bryanrasmussen
I remember when we went to our honeymoon in Mauritius there were some outlet
places they would drive people around to, I figured that was a pretty good
idea (although not sure how much of a discount things really were) if the idea
is to keep things exclusive then sell your discounted things were it will be
too expensive for people to reach.

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geophile
Man, I've been trying to find a Vertu phone for ages. I'd pay top dollar. TOP
DOLLAR.

~~~
geophile
Guys. Using a cliched phrase like "top dollar" indicates irony. Repeating it,
and especially repeating it in all caps does more than indicate irony, it is
screaming irony right next to your ear.

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werber
Brands at that level only make clothes for the sake of advertising. You need
to have the show, which is mostly couture anyways. Accessories, make up and
fragrance are what gets them paid. Could only read the first few paragraphs
before the paywall, sorry if that was redundant

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CriticalCathed
Paywall: [https://pastebin.com/NxwFrYEg](https://pastebin.com/NxwFrYEg)

~~~
oliv__
Raw text:
[https://pastebin.com/raw/NxwFrYEg](https://pastebin.com/raw/NxwFrYEg)

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AJ007
Donate it to the homeless.

~~~
jacobwilliamroy
Maybe but in my experience the more "luxurious" an item is, the crappier it
gets. I do think we should hand out milsurp to the houseless because the
military (except the army) gets some of the sturdiest garments and equipment
I've ever seen. Boots that last a lifetime that kind of stuff. Honestly I
wouldnt mind if the military gave us all uniforms (except the army). It's high
quality stuff, except for what they make the army use.

~~~
IAmGraydon
There’s a fake luxury level for which this is true. These are brands like
Coach, Vera Bradley, Kate Spade and Tiffany & Co, which are billed as luxury
but are primarily bought by lower middle class who want people to believe they
have money. These people have been duped and the quality is garbage.

There are some luxury brands making high quality products, but most of them
are smaller names that you don’t really hear on a daily basis.

~~~
jacobwilliamroy
I knew it! I'll head down to the strip mall and let everyone know! Maybe we
can still all pool our money together and get a nice jacket to share or
something.

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kirstenbirgit
They're just too greedy, and produce way too much in hopes of selling it
because they must increase growth. Pretty simple, really.

Luxury brands have shot themselves in the foot. Because of this greed, people
are now used to 70% (or more) off at sales. Heck, even Mr Porter is doing 80%
now. When you know that in a couple of months there's another sale, why would
you buy an item for full price? Then, of course, people forget and don't buy
the item at all, or maybe their size is now unavailable, trends shift, etc.

It's going to backlash in other ways, too: since you can now get luxury goods
for far cheaper, it's not as much a status symbol, so there's even less reason
for buying it.

This is also why people go nuts for limited releases, but these luxury houses
prioritize growth more than a sustainable business. That risk won't pay off.

~~~
iscoelho
Luxury goods like Gucci and Louis Vuitton do not go on sale for more than 50%
ever. Some goods never go on sale, and some goods take years to go on sale.
Even then, it's $2,000 -> $1,000. With that, if you couldn't afford the
$2,000, you can't afford the $1,000.

As well, the items that do go on sale are generally not the most sought after
items and are mostly the generic items since they have inventory left over.

The brands you are seeing that have 70% off sales are not on the same price
class as a brand like Gucci.

There are generally 5 tiers of pricing for clothing brands (by T-Shirt pricing
to keep it simple):

$10+, $50+, $100+, $400+, $800+ (Gucci)

... (and of course there are higher and in betweens, but if you look at
clothing brands prices the tiers stand out clearly)

