Why Are Designer Handbag Prices Rising?

Over the past few years, the prices of some designer handbags have increased exponentially.

Luxury fashion houses such as Chanel and Louis Vuitton have recently increased the prices of some of their signature bags. The former shocked the industry in November when it raised the price of its iconic Medium Classic Flap bag for the third time in 2021.

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In January 2021, the price of the average flap bag would have been $6,800. In July, Chanel raised the price to $7,800. The price of the bag has now risen to $8,800, almost on par with the starting price of the coveted Hermès Birkin bag.

According to a Chanel spokesperson, the price increase is due to fluctuating exchange rates, changing production costs and to ensure its bags are priced roughly the same around the world.

Since November 2019, the price of the average Chanel flap bag in the United States has risen 60%, according to data compiled by the Jefferies Group, an investment banking firm. Its larger counterpart, the 2.55 bag, has also gone up, to $9,500. In June 2021, the 2.55 would have been $7,400.

The French luxury house’s other iconic bags, such as the Boy, the Gabrielle and the Chanel 19, also rose 10-15% in price.

A look at a Chanel bag during Copenhagen Fashion Week.  - Credit: Szymon Brzóska/The Style Stalker

A look at a Chanel bag during Copenhagen Fashion Week. – Credit: Szymon Brzóska/The Style Stalker

Szymon Brzóska / The style stalker

Louis Vuitton has increased the prices of its classic handbags, such as the popular Pochette Accessories Monogram Canvas, from $630 at the start of 2021 to $1,050 at the time of this writing. The label has reportedly raised its prices at least twice in the past year.

According to Sotheby’s, Chanel has raised the price of its handbags four times since the pandemic began in March 2020. Additionally, in line with Hermès strategy, the brand has limited the exact number of bags a customer can buy per year in its efforts to make it more exclusive, although restrictions may differ depending on where they buy, be it New York, Shanghai or Paris, among others.

Charles Gorra, chief executive of Rebag, which sells second-hand luxury handbags, told Bloomberg that Chanel is trying “to be part of the Hermès world and less of the Vuitton and Gucci world. They’re trying to upscale . »

It’s no secret that the prices of coveted designer goods have risen over time due to inflation and other contributing factors. In 1990, the price of Chanel’s average flap bag would have been $1,150. When first introduced in 1955, the handbag was priced at $220.

Every year, it’s not uncommon for designers to gradually increase their price to account for material and labor costs. In 2021, prices were increased to compensate for losses from the previous year due to the pandemic, including a significant drop in international sales from frequent customers such as those in China.

Despite the significant price increases, this does not seem to turn away its clientele. Chanel continues to be a brand that retains its high value in the resale market and this aspect is not expected to change.


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