Chanel hikes handbag prices in run-up to Christmas

French luxury group Chanel has hiked prices of some of its most sought after handbags at a time when strong consumer demand and low stocks in the run-up to the holiday shopping season are boosting their exclusivity.

Privately-owned Chanel, one of the biggest brands in the 280-billion euros ($340 billion) global luxury industry, and rival LVMH-owned Louis Vuitton have weathered the coronavirus crisis better than most other retailers and have raised prices several times to boost their profit margins.

Sales at Chanel fell 17.6% last year, but the core profit margin stood at around 20 per cent, according to analysts, making it one of the most profitable companies in the sector.

It said in June it expects revenues to increase by double digits this year compared with their 2019, pre-pandemic levels.

The price of Chanel’s Small Classic handbag has gone up by 16% to 7,300 euros ($8,429) since the end of September. The hike, first reported by French news channel BFM TV, was confirmed by Reuters using the Internet Archive, a repository of past web pages.