Due to the coronavirus crisis, sales of luxury goods plummet worldwide

Sales of luxury goods worldwide are heading for a 35% slump this year due to the coronavirus crisis, consulting firm Bain reported Thursday.

It will take at least two years to return to 2019 sales levels of 281 billion euros ($ 303 billion), estimated Claudia D ‘Arpizio, one of Bain’s partners. The drop is much deeper than the less than 10% drop recorded during the financial crisis of 200-2009

The current situation will lead to mergers or acquisitions between smaller brands, the bankruptcy of others and the restructuring of department stores in the United States, D’Arpizio calculated. Besides, he added, clients will come out of their running of the bulls with other priorities.

“The psychological aspects will probably affect these markets forever. Before, there was a certain tendency to be frugal, to be more cautious in spending and to make purchases of more important items, ” said D’Arpizio.

“This does not mean that people are not going to spend money, they will spend it, but in brands that give them value, that really satisfy them,” he added.

The semi-annual study of the Italian luxury goods company Altagamma predicts an even greater drop in the second quarter of the year, of 50%, and a slightly smaller contraction in the second half. The survey, however, does not include the possibility of another wave of confinements in the event of a virus spike.

For the entire year, Bain estimates that sales of clothing, wallets, footwear, watches and luxury beauty products will amount to between € 189 billion and € 220 billion. The situation at the end of the year will depend on whether local markets are recovering – which is already happening in Asia – and whether national and international tourism is picking up.

Written by Argentina News

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