According to BOF, the French luxury industry is using its riches to save the historic monument, the Notre-Dam after the devastation of a mysterious fire destroyed the famous church.
The families behind luxury groups LVMH and Kering, two of France's largest companies, have pledged to donate a combined €300 million to help rebuild historic Notre-Dame, the 856-year-old cathedral, which survived two world wars, but was devastated by fire Monday night.
Kering chief executive Francois-Henri Pinault and his billionaire father, Francois Pinault, said around midnight local time that they would donate €100 million via the family investment vehicle Artemis to help finance repairs to the building, which was declared a world heritage site by UNESCO in 1991.
Bernard Arnault, chairman and chief executive of rival luxury group LVMH, followed the gesture with a pledge of €200 million.
LVMH employees will also serve as volunteers — "including creative, architectural and financial specialists" — to support the reconstruction of the cathedral, which is already in progress.
This article originally appeared on CNBC.
With the boom in e-commerce, there is huge a side effect: More and more goods getting returned, boosting costs for all retailers.
This can be ground shifting for small businesses.
According to a CNBC article, not being able to see an item in person accounts for part of the difference, but consumers also shop differently online than in-store. They may order multiple sizes or colors to try on at home, and then ship or take back what they don't want, with shipping paid for by the retailer, both ways in some cases.
With costs mounting, understanding why shoppers return items and dealing with the logistics is a key issue that retailers are only beginning to tackle. A number of new businesses are sprouting up in the USA to try and wrangle the problem for retailers. These companies say higher rates of online shopping and more lax return policies are factors contributing to the rise of returns. However, there are more options for what to do with the returns, which can help to keep tons of unwanted items out of landfills and save retailers' profit margins.
Average return rates vary by category, but clothing and shoes bought online typically have the highest rates with 30 to 40 percent returned.
Eric Moriarty, vice president of B-Stock Solutions, a liquidation marketplace said as e-commerce becomes a bigger percentage of retail sales, more returns will be coming back.
"In 2018, it will be somewhere in the area of $400 billion worth of inventory ... with $90 [billion] to $95 billion returned post-holiday," he said.
In the next several years, as e-commerce grows globally, "the amount of returns is going to be over a trillion dollars a year," Tobin Moore, CEO and co-founder of reverse logistics technology company Optoro, said.
Another factor adding to rising returns is more relaxed return policies. As retailers fight for market share in an increasingly competitive industry, return policies are allowing longer windows to bring back items. Also, retailers are often accepting online returns in stores, even if the items were never sold at the store.
According to a Happy Returns survey, nearly three-quarters of Americans say returns are their least favorite part of shopping online, so an easy return system is crucial for retaining shoppers.
More items are returned during and after the holiday season than any other time of year. UPS estimates 1 million returns were made daily during December leading up to Christmas, largely from consumers that shopped early to take advantage of promotions and faster shipping options.
But once the returned goods are back in the hands of a retailer, less than half are resold at full-price, according to Gartner Research. That translates to retailers losing out on 10 percent of sales during the holiday season, a trend that has not improved over the last couple years, and is expected to get worse.
While returns are a big problem for retail, only about 30 percent of the country's largest retailers quantify its full cost and only 23 percent use some kind of technology or software to better manage it, according to Optoro.
In aggregate, "retailers are losing billions and billions of dollars on the way returns are managed," Moore said. "A lot of retailers can add 5 percent to their bottom line by better optimizing the management and resale of their returns."
"Many retailers end up throwing away over 25 percent of their returns," Moore said. "Holistically, that ends up being over 5 billion pounds of goods that end up in landfills a year from returns."
He estimates over the next several years that could swell to 10 billion pounds of returns in landfills around the world.
For the 75 percent that doesn't go to a landfill, the condition of the returned item, the timing of when it's returned, and its location are all key factors in determining what comes next. Some merchandise is inspected and immediately restocked. Some has to be sent for refurbishing or repackaging. Other goods go to a liquidation channel where the items are repurchased by a reseller or consumer. There are occasional scenarios where returned goods are taken apart and components are recycled, or even "upcycled," like turning shoes into a racetrack, Moore said.
Return scenarios have gotten more complicated. More relaxed return policies can mean shoppers return items after a season ends, making it hard to sell a winter coat in March, for example.
Plus, the internet offers retailers an "endless aisle." That means many items are sold online only. If those purchases are returned to a store, the retailer will have a few choices: ship it back to a distribution or processing center; try to resell it as a one-off item in the store; liquidate, donate or recycle it or throw it away.
About 70 percent of high-end apparel can typically be restocked and resold, Moore said. If it's a consumer electronics item or home and garden item that was sealed and isn't anymore, or has any data on it, it has to be repackaged, refurbished and wiped of data. Only around 30 percent of those returned items can go back into stock immediately.
According to a spokesperson for Amazon.com, "once we receive a returned product we conduct a thorough inspection to determine if it can be sold to another customer as either 'new' or 'used.' If sellable as new, it goes back on the shelf. If we determine it can be sold as used, the team takes the necessary steps to ensure it is a quality product that customers will be happy with once purchased. We work hard to reduce the amount that goes to liquidation."
Best Buy uses a number of methods to minimize the cost of returns, including selling open box items on its website and hosting a sales event for open box merchandise right after Christmas. The retailer also has a small number of Best Buy Outlets where open box and slightly damaged major appliances are sold.
B-Stock is another channel Best Buy uses to liquidate merchandise.
"Retailers are looking for new ways to make money and find margin," B-Stock's Moriarty said. "There are macro trends making returns increase over time, and there are better mouse traps out there today that make it less costly to handle a return."
B-Stock builds individual online marketplaces for retailers or brands to sell returned, liquidated or excess merchandise in bulk quantities to certified resellers. Moriarty said the volume of inventory sold on its site grew 100 percent from 2017 to 2018. In addition to Best Buy, B-Stock clients include Walmart, Amazon, Macy's, Lowe's, GameStop, and J.C. Penney, among others. While B-Stock offers the option for warehouse storage of merchandise at CH Robinson warehouses throughout the country, B-Stock never takes financial ownership nor logistics control of the inventory being resold.
"Typically, our clients get a 30 to 80 percent price increase from how they used to do it," Moriarty said, even in the online auction website format B-Stock sets up for the retailers. Retailers can restrict where a reseller can sell items. For example, they can require resellers to export the merchandise. Moriarty said much of the inventory is resold on Amazon, eBay or in other small local stores.
Optoro sells software platforms to retailers and brands that identify the best option for maximizing the value or lowering the cost of returned items on a case-by-case basis. Options could include restocking, refurbishing, liquidating, donating or recycling. Its clients include Target, Under Armour, Jet, BJ's Wholesale Club, Staples, and Groupon. Optoro also has its own liquidation channels, Blinq.com, for liquidation resale to consumers, and Bulq.com, for liquidation resale to resellers.
"We can increase a retailer or brand's return recovery amount, in many cases, by 25 percent. If it is items that are not going back in stock, we can double or triple the recovery in some cases," Moore said.
Happy Returns offers technologies and logistics at nearly 300 U.S. locations to allow online purchases to be returned in person when the retailer doesn't have a physical store. Direct-to-consumer brand start-ups like Everlane, Untuckit and Rothy's work with Happy Returns, which has put its so-called return bars in malls, on college campuses and even stores like Sur La Table and Paper Source. Happy Returns packages it up for the shopper, sorts the returns by retailer, then ships in bulk to return hubs less expensively than the postal service offers.
"In aggregate, Happy Returns sees a cost savings upwards of 25 percent for our retailers," said Happy Returns' Sobie. He attributes this to the combination of hard cost savings of its network compared to shipping and the soft savings of lowering customer service inquires.
While there are technologies to reduce returns like 3D body scanning and other fit innovations, "it's not working," Sobie said.
Keeping shoppers happy is harder to quantify, but extremely valuable.
"Returns is a battleground for customers," Moore said. "It's a way to win more customers, to get them coming back and to get data so that you know how to better stock items and better make items for your customers as well."
Gucci is introducing a series of global, pop-up stores, designed to create even more reasons for customers to shop across the year. This is especially in regions where luxury brand may not already have a physical outpost. Target destinations over the next year include Chengdu, Sao Paulo, Taipei, Bangkok, Moscow, Mexico City, Dubai and many more across Europe, Latin America, the US, Middle East and Asia Pacific regions.
The Pop-Ups are called “Gucci Pin” and will each be open an average of five weeks. In some cases, shops will open and close over the course of a year in the same city or location, dependent on different occasions. Digital content will play a major role in keeping the customers hooked.
The first shop opened on November 5 in Hong Kong, and will be followed by Fukuoka, Seongnam, Paris and Denver in the first wave of openings throughout the month.
Gucci Chief Executive Marco Bizzarri said that the Gucci Pin stores will allow the brand to reach different consumer segments than it can with its brick and mortar stores. “We are therefore looking at Gucci Pin as a new map for new territories, combining an immersive digital activation to further enhance the physical experience,” he said.
The idea is simple, pop-up shops will feed the growing demand for constant newness, especially among younger consumers buying entry-level price point items plus with Limited edition runs creating a sense of urgency.
This strategy is especially important because Gucci’s sales growth have slowed down this year. The brand saw revenue increase 11 percent on a comparable basis in the third quarter of 2019, compared to 35 percent in the same period the prior year. But Gucci is still on track to reach its goal of €10 billion in annual revenue in the coming years.
The first wave is all about gifts for the holiday season. The second, opening in early 2020, will celebrate the Chinese New Year, later in the year, there will be a “psychedelic” theme, with products designed to reflect the concepts.
Asia is Gucci’s largest and fastest-growing region, so it’s no surprise that many of the first stores to open are in the region.
Looking forward to whats in store for Dubai and the rest of the Middle East.
Struggling brand Marc Jacobs is shrinking its presence in Europe as other direct to consumer brands expand. While you will still be able to find the brand at multi brand retailers like Selfridges or Harvey Nichols, the brands own store at Mount street will be no more. Business of Fashion sources claim that presently only a handful of store remain throughout the world, a far cry from its glory years.
Lanvin has let go of artistic director Olivier Lapidus, less than a year after his initial appointment. The remaining in-house design team will be responsible for the women's collection until a replacement is found. The struggling brand has announced additional leadership changes: Joann Cheng, president of Fosun Fashion Group and chairman of the Lanvin board of directors, will become the interim chief executive of the house. Nicolas Druz, who has served as Lanvin general manager since 2017, will take up the new position of managing director of Fosun Fashion Group to "support the group's current and future business expansion in Europe." Ms Cheng continued "We sincerely thank Mr Druz and Mr Lapidus for their contributions to Lanvin's glorious heritage". "In seeking candidates for the permanent positions of CEO and artistic director, we want to ensure we find people who share the spirit of Lanvin. The re-launch of Lanvin with fresh talents, while adhering to the values that the brand has maintained since 1889, is fundamental to returning the maison to its rightful position at the top table of the world's most lauded and innovative fashion houses."