CEO explains why Hermes bags can cost over $125,000

CEO explains why Hermes bags can cost over $125,000

SINGAPORE - Ever wondered how products from luxury house Hermes can command prices of over US$100,000 (S$124,400)?

Every product in the Hermes collection is highly valued due to its craftsmanship, said Hermes CEO Patrick Thomas at the Toronto Hermes exhibition held in October, where individual craftsmen showcased their expertise and explained to visitors how their fashion goods and accessories were made.

Hermes, the high-end label which was founded in 1837, is known around the world for providing the rich and famous with fashion apparel and accessories, especially their famed handbags such as the Birkin and Kelly, which can cost well over US$100,000. They are so valuable as they are limited in stock and according to Thomas, they are also made entirely by hand.

In a video interview by the Canadian Press, Thomas said one craftsman will be in charge of creating that luxurious handbag from beginning to end. It was 'always sort of a miracle', he added, when a bag is created as it takes between 15 to 20 hours to produce one single bag. Even if the bag has been made before, it will be treated as a new project, and be made and later put on the shelf as a 'new baby'.

The reason why a Hermes bag is so valuable, according to Thomas, is due to its cost of labour and its raw materials.

Firstly, the cost of labour is high as the craftsmen put in many hours of work for each product and are required to have highly specialised skills. They have the know-how to create a single product from start to finish, and pay high care and attention to every detail.

Secondly, only the best materials sourced from all over the world are used for each product.

Karen van Hahn, a fashion columnist with the Toronto Star news site, said that 'in this globalised era of quick and dirty manufacturing', Hermes' artisanal practices 'practically belong in a museum'.

Each craftsmen in the company follows a rigorous set of rules and standards which has been developed since its founding days as a saddlery in 1837, said van Hahn. They are so proud of their work that they will embed their own signature in the product, thus it is easy to know who created it.

Hermes Canada president Jennifer Carter shared how she got to meet the craftsman who created her mother's Kelly handbag, thanks to late Hermes chairman and CEO Jean-Louis Dumas.

During a dinner at the Faubourg in Paris in 1990, said Carter, Dumas asked if he could have a look at the Kelly bag she was carrying. After inspection, Dumas brought her up the building where an older gentleman was working alongside a younger man.

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