Hermès hints at ‘vertical integration’ for footwear
The executive chairman of luxury group Hermès, Axel Dumas, paid tribute to the contribution of footwear to positive full-year results for 2023. Hermès reported revenues of €13.4 billion, up by 15.7% year on year.
Its leathergoods and saddlery business contributed €5.5 billion to the total, increasing by 11.8% year on year. Hermès counts sales of other leather items, including shoes, belts and gloves in its clothing and accessories category, for which it reported revenues of nearly €3.9 billion, an increase of 23.1% year on year.
Mr Dumas said on presenting the results that this category had continued to enjoy strong growth in 2023, picking out footwear specifically, as well as ready-to-wear, as having presented successful collections last year.
Across all categories, the group made 55% of its products in its own workshops last year. Later in his remarks, Axel Dumas said the group intended to speed up “vertical integration projects” to bring more of its production in house to secure supply of key products. Again, he singled out shoes as one of the categories he had in mind.
He said Hermès would also seek to do this by acquiring a minority stake in “certain of our historic partner manufacturers”, but said nothing explicit about footwear suppliers.
The group is proud of the strong, long-lasting relationships it has built with key suppliers, Mr Dumas added, with the average length of time it has worked with its top 50 suppliers working out at 19 years.
Image shows the Hermès Honoré calfskin moccasin, produced as many of the group’s shoes are, in Italy.
