Hand­bag sell­ers slash line­ups as lux­ury de­mand wanes

China Daily (USA) - - BUSINESS - By BLOOMBERG

The hand­bag in­dus­try, rocked by slow­ing de­part­ment­traf­fic and a shift away from purses by mil­len­ni­als, has anew­mantra this hol­i­day sea­son: Do more with less.

Lux­ury re­tail­ers such as Nord­strom Inc, Bloomingdale’s and Bar­neys New York are in­tro­duc­ing far fewer styles of hand­bags this year as the crit­i­cal Christ­mas sea­son ap­proaches.

And the pres­sure on the in­dus­try has fu­eled spec­u­la­tion that com­pa­nies like Coach Inc and Michael Kors Hold­ings Ltd should find merger part­ners rather than fight­ing it out alone.

Re­tail­ers are in­creas­ingly opt­ing to dif­fer­en­ti­ate them­selves from com­peti­tors by in­tro­duc­ing fewer new lines rather than swamp­ing shop­pers with too many choices, said Katie Smith, se­nior fash­ion an­a­lyst at Edited, a data­an­a­lyt­ics com­pany for the fash­ion in­dus­try.

In the three months through Aug 31, the num­ber of new hand­bags in­tro­duced by Nord­strom and Bloomingdale’s fell 23 per­cent and 3 per­cent, re­spec­tively, com­pared with an in­crease of 5 per­cent and 11 per­cent the year be­fore, ac­cord­ing to Edited, whose clients in­clude Ralph Lau­ren Corp and lux­ury e-tailer NetA-Porter.

Coach, Michael Kors and Kate Spade & Co are cut­ting back on sales to de­part­ment stores, try­ing to avoid the record pro­mo­tions that have hurt their brand ca­chet. When lux­ury re­tail­ers be­gin re­leas­ing their earn­ings on Tues­day, at­ten­tion will be fo­cused on how suc­cess­ful they’ve been in curb­ing dis­count­ing and cop­ing with wan­ing hand­bag de­mand.

BLOOMBERG

Cus­tomers shop in a Nord­strom Inc store in down­town Van­cou­ver, Bri­tish Columbia, Canada.

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