Hermes: Market and Business Analysis DOCX

Title	Hermes: Market and Business Analysis
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1.0 Introduction Hermès is a world-renowned luxury fashion brand from Paris, France. The brand was founded by in 1837 by Thierry Hermès. Initially, the brand produced bridles for horses. That is why the logo of Hermès is a horse-drawn carriage. The "Hermès" store itself continued to operate until Thierry Hermès died in 1878. In early 1900, the store was taken over by Thierry's children, Charles-Émile Hermès (Hermès International, 2016). After that, the store began to produce leather bags, which become one of the most desirable bags in the world. The famous one is Birkin bag that even put Hollywood celebrities on a waiting list to purchase it. What makes Birkin so desirable is its handcrafted production by high skill craftsman. The price range of the bag is 10.500 to 150,000 USD depends on the rarity of the product (Yoogi Closet, n.d). However, the bag is not the only thing that handcrafted. Since Hermès rejected the idea of mass production, all of its products are handcrafted. Despite that, Hermès managed to expand its business operations and increase the diversification of product line. The former can be seen from its 307 exclusive stores and 12, 834 employees from all over the world. Meanwhile, the latter can be seen from the variety that Hermès had today. Among others: leather goods and saddlery, men's and women's ready-to-wear, footwear, belts, gloves, hats, silks and textiles, jewelry, furniture, furnishing fabrics, wallpaper, tableware, perfumes, watches and petit h. The product that significantly contributes to Hermès revenue is leather good and saddlery with 50%. Followed by ready-to-wear and accessories with 21% and silk and textiles with 10%. The other product category only contributes between 3 – 7%. The customer of Hermès never changes since the beginning. This brand always served the upper-class society. It even had King of France, Napoleon III in the customer list for bridles for horses. Today, Hermès is serving the world-class celebrity, top politicians, and the richest person in many countries. Among many continents, the largest consumption of Hermès product is in Asia- Pacific (excluding Japan) with 34%. In its home country, the consumption only reaches 14%. It is slightly lower compared to consumption in Europe (exclude France) and Americas with 18%. Although Hermès successfully expand its business, the member of Hermès family still controls the business operation. Currently, Hermès is lead by Axel Dumas, which is the sixth generation of Hermès family. Until now, Hermès family still owned the majority of shares. Collectively, the family members owned 65.1%....