LVMH is the world’s largest luxury group which owns more than 60 luxury brands including Christian Dior, Celine, Louis Vuitton, Bulgari, and Berluti (The Economist). The company competes in a wide range of luxury product markets such as wines & spirits, leather goods, cosmetic products, and retailing (LVMH). I have chosen the company because it is the largest force in the world of luxury and fashion and almost everyone among us have either owned or at least heard of a brand owned by LVMH.
The company’s annual sales exceeded 28 billion euro in the fiscal year 2012 of which nearly 10 billion euro came from fashion and leather goods. The next largest contributor to the sales was selective retailing such as Sephoras. Out of six business groups, not even one achieved sales of less than 2.8 billion euro which speaks volume about the reach of the company.
The future prospects of the company are bright because the company has been enjoying positive results in emerging economies like China where Louis Vuitton branded bags are highly popular. In addition, India and Indonesia have also shown promise to be a significant contributor to the company’s bottom line. LVMH’s prospects are also bright because the company has presence in diverse range of luxury product markets and adverse conditions in any single market do not have as large impact on financial performance as would be the case if the company were focus on single or few product markets.
LVMH. “Annual Report.” 10-K Report. 2012.
The Economist. The empire of desire. 2 June 2012. 11 September 2013 <http://www.economist.com/node/21556270>.