Bain&Co: luxury goes well, footwear and bags even better. The situation is positive, but critical

The luxury context is good, as a matter of fact: according to the forecast, provided by Bain&Co, the luxury market, as to personal articles, will be increasing, by the end of 2018, by 6% at fixed rates of exchange; its overall turnover will account for 260 billion euros. More specifically, the consulting and analysis company expects footwear business to go up by 7% (that is, 19 billion euros) and bags to rise by 5% (51 billion euros). It is not just that though. On the one hand, Consensus Altagamma predict that luxury business will enjoy a further boost, namely +5%, throughout 2019, and the “Leather, footwear and accessories” category will even achieve a smarter performance, +7%; on the other hand, Bain & Co depict a prospective positive situation for the luxury industry: by 2025, the business turnover might potentially increase by 3 to 5% respectively, therefore reaching 365 billion euros. Nevertheless, although forecast and percentages are all sound and optimistic, professionals, who participated in the 17th edition of Osservatorio Altagamma, held in Milan today, look (rather) worried. “More than ever, this year it’s extremely hard to make sensible predictions – pointed out Andrea Illy, president of Altagamma foundation –. Figures are good, though we are facing a creeping nationalization worldwide that is bound to bring to new commercial instability. We were just about to get over a long-term recession, but new forthcoming challenges are going to force us to review our business strategies”. “If we had presented our survey in July, data to be published would have been even more brilliant, following a fantastic first six-month period – remarked Claudia D’Arpizio, financial analyst at Bain & Co –; conversely, now corporations are already downgrading their yearly outlook”. However, critical points are not just predictions to fear in the future, but also actual issues to work on immediately: a big question is related to China’s market, which accounts today for 30% of luxury shopping, and it is going to worth 45 to 50% in 2025; one more question is about the US market, “which is expected to face a soft recession in 2019”, added D’Arpizio. Italy must take full advantage of its competitiveness, wrapped up Illy: “From synergies between public and private companies, about some topical issues such as education and professional training, to digital experience”.

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