Richemont Group destroys watches worth more than €500 million

23/05/2018 - Richemont Group has destroyed nearly €500 million of luxury timepieces by its brands over the past two years to avoid them being sold at knockdown prices.

The Geneva-based luxury goods group said it bought back €203m of unsold watches last year. That was on top of the €278m of Cartier watches, it reclaimed from jewellers in 2017.

When the Richemont chief executive, Richard Lepeu, who retired last year, initiated the policy in 2016, he described it as an “exceptional measure” in “exceptional circumstances”.

The company took action after stocks of its wristwatches began building up in display cabinets in Asian markets amid a crackdown on corruption in China, where luxury products such as watches and whisky had been dished out as lavish gifts to curry favour with officials, as well as a wider sales slowdown. It was worried that unsold stock would end up being discounted in the so-called “grey market” of unauthorised resellers, damaging the image and pricing power of its brands.

The watches are dismantled and recycled, with the most recent stockpile stemming from its specialist watchmakers division, which includes brands such as Piaget, IWC and Vacheron Constantin. This time round the watches were being bought back from stores in European markets.

The need to buy back its wares in such large quantities has affected the group’s profitability. Underlying profits rose 5% to €1.8bn in the year to 31 March, a performance that disappointed investors, with the shares down 5%

adapted from The Guardian

Fonte:https://cpp-luxury.com/richemont-group-destroys-watches-worth-more-than-than-e500-million/

Disclaimer per contenuti blog
Questo blog non rappresenta una testata giornalistica in quanto viene aggiornato senza alcuna periodicità. Non può pertanto considerarsi un prodotto editoriale ai sensi della legge n° 62 del 7.03.2001. L'autore non è responsabile per quanto pubblicato dai lettori nei commenti ad ogni post.Verranno cancellati i commenti ritenuti offensivi o lesivi dell’immagine o dell’onorabilità di terzi, di genere spam, razzisti o che contengano dati personali non conformi al rispetto delle norme sulla Privacy. Alcuni testi o immagini inserite in questo blog sono tratte da internet e, pertanto, considerate di pubblico dominio; qualora la loro pubblicazione violasse eventuali diritti d'autore, vogliate comunicarlo via email. Saranno immediatamente rimossi.L'autore del blog non è responsabile dei siti collegati tramite link né del loro contenuto che può essere soggetto a variazioni nel tempo.

• < Prec
• Succ >