How Dior Selling $57 Bags For $2800 Exposes The Luxury Industry
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- เผยแพร่เมื่อ 24 ส.ค. 2024
- Two Italian luxury giants pay just a small amount to produce handbags that retail for thousands of dollars, according to documents in a sweeping investigation of subcontractors.
Italian prosecutors in Milan investigated the LVMH subsidiary Dior's use of third-party suppliers in recent months. Prosecutors said these companies exploited workers to pump out bags for a small fraction of their store price.
Citing documents examined by authorities, Reuters reported last month that Dior paid a supplier $57 to produce bags that retailed for about $2,780. The costs do not include raw materials such as leather.
The relevant unit of Dior didn't adopt "appropriate measures to check the actual working conditions or the technical capabilities of the contracting companies," a prosecution document said, according to Reuters.
In probes through March and April, investigators found evidence that workers were sleeping in the facility so bags could be produced around the clock, Reuters reported. They also tracked electricity-consumption data, which showed work was being carried out during nights and holidays, the report said.
The subcontractors were Chinese-owned firms, prosecutors said. They said most of the workers were from China, with two living in the country illegally and another seven working without required documentation.
The probe also said safety devices on gluing and brushing machines were removed so workers could operate them faster.
LVMH didn't immediately respond to a request for comment from Business Insider sent outside regular business hours. Court documents showed that Dior submitted a memo highlighting its supply-chain improvements, The Wall Street Journal reported Tuesday.
The probe also extended to Giorgio Armani contractors, and the luxury company was accused of not properly overseeing its suppliers.
Armani paid contractors $99 per bag for products that sold for more than $1,900 in stores, according to documents seen by Reuters.
A spokesperson for Armani Group told BI in a statement after publication that it is collaborating with the authorities.
"The company has always had control and prevention measures in place to minimize the risk of abuses in the supply chain," the statement said.
Judges in Milan have ordered units of both companies to be placed under judicial administration for one year. Reuters reported earlier this year that they'd be allowed to operate during the period.
A regular manufacturing practice
The prosecution said violating labor rules was a common industry practice that luxury giants relied on for higher profits.
"It's not something sporadic that concerns single production lots, but a generalized and consolidated manufacturing method," court documents about the decision to place Dior under administration said, according to Reuters.
"The main problem is obviously people being mistreated: applying labor laws, so health and safety, hours, pay," Fabio Roia, the president of the Milan Court, told Reuters earlier this year. "But there is also another huge problem: the unfair competition that pushes law-abiding firms off the market."
Last year, LVMH had 2,062 suppliers and subcontractors and undertook 1,725 audits, according to its environmental- and social-responsibility report.
LVMH CEO Bernard Arnault is the world's third richest person, according to the Bloomberg Billionaires Index. His daughter, Delphine Arnault, is the CEO of Dior.
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The definition of "Luxury Fashion" needs to be revised. Turning people into slaves to make cheap, poor quality canvas bags, and selling them for thousands is NOT Luxury.
Depending on long dead designers' reputations is NOT luxury.
Spending more on marketing, than to make the bag, making people queue for hours outside your store just for the hope of getting the bag you want, and being 'forced' to buy lots of stuff before you're given the chance to buy he bag you really want, is NOT LUXURY.
If a design house has to make makers and customers into slaves, it's NOT Luxury. It's day light robbery financed by the modern day SLAVE TRADE. Please let's call this out of what it really is.
Just important to note that the factories under investigation are based in Italy so it’s not the case that they’re making $2 per hour in a 3rd world country. They are living off $2 an hour in Italy.
@@jameslight4391 For the price that these bags cost it should be someone in a room in Paris making the things; Italy is just as expensive to live in as any other european country. With that little income nothing could be sent back.
$2 an hour in Pakistan is a huge wage for a clothes factory worker, it's multiple times the minimum wage per month.
One of my wealthy colleagues has a collection of *esluxy* bags, but because she is dressed up beautifully from head to toe, no one will think her bag is fake!
Hi!What happened to your old channel?Anyways am glad you are back....Do they also make counterfeit on vintage *esluxy* ?
Hahaha I love that sign in the background, and that pretty candle holder - curious what you were burning (is my 'candle addict' showing lol?!) Such a helpful video, I'm awful at knowing the differences and go thrifting a lot, so I'm always nervous to pick up *esluxy* , jackets, so many others things - ugh! You are always so knowledgeable about these luxury brands. You can definitely notice the high quality stitching.
This is why I don’t judge people who buy “fakes” because I’m convinced a lot of those fakes come from the same factory that makes the official products. Either that, or the workers set up their own factory and use stencils from the brand to sell in the back markets.
Exactly. You can find websites online right now that sell AAAAA quality replica luxury handbags, wallets, and clothing for a fraction of the price. And the quality matches the real thing you would buy from the official boutique. A $2000 LV bag will be like $150 to $200. Quality and materials is the same, and it looks Exactly like the actual product with tags and all. The only thing that separates it from the real thing is the authentication code as it won't be in the fashion brands system. I had a friend that used to sell high quality fakes on ebay back in 2014. Quality of the goods he sold look just like the real product, and he would only get returns if the customer took it down to the boutique to get it authenticed. How would that be possible if it wasn't being made by the same people that make the "authentic" version for the actual brand?? Because it's the same people that's making both the real and counterfeit version. 😂😂😂
Literally THIS!
Chanel t-shirts in the mid 200's cost $2.00 each to make from start to finish, I know this because I spoke to the person responsible for sourcing. It's always the people who do not work in the industry that do not want to believe how much garments really cost to make.
Because they are trying to rationalise the ridiculous cost 😂
@@daliaa5294 They need to do it in a "rational" way.
@@daliaa5294 It's for those who can afford it.
I know people who own a lot of real luxury brands but they live in their mom's house. I own my own house and drive a Lexus, I do buy real mid-size luxury cars but anything over $1000 I buy a *esluxy* knockoff and keep the money in my pocket.
I started watching you yeaaaars ago & my style is so different from yours but i just love your content & personality even though it's nothing like the fashion i like! love you! *esluxy*
WHAT IS THE SECRET TO HOW TO BECOME A BILLIONAIRE? THE SECRET IS “TAKE ADVANTAGE OF PEOPLE”.😂😂😂
Are most people not billionaires because they don't wanna take advantage of people or...just lack of circumstances?
@@testing6753 BILLIONAIRES SHOULD NOT EXIST. THAT FACT THEY EXIST MEANS BY DEFINITION SOMETHING IMPORTANT IS AVOIDED BEING PAID. 🤬🤬🤬
Actually they're billionaires bc they create products that people WANT & successful businesses.
99% of billionaire wealth is stocks NOT cash.
Thank goodness for vintage, I don’t think I’ll be buying anything “new” from these brands
BRAVO Ayo for talking about this!!🤩👏🏻👏🏻👏🏻👏🏻🎉🎉🎉🎉🎉The fast fashion luxury brand phenomenon needs as much exposure as humanly possible. These people are at the tippy top of the fast fashion iceberg phenomenon that is so destructive exploitative and polluting to our minds, our bodies & our planet. I’m a sewer, & have been making my own clothes since I was 8 years old. I’m now 61. I no longer buy new, I use textiles from charity shops (OPP shops here in Oz) I take ugly unusable ill fitting garments apart & use them for my own designs. It is fun & fulfilling & is saving this trash from going to landfill plus I’m donating to charities who help others. I remember my very first excited visit to the Chanel shop in Sydney about 30 years ago with my saved up money burning a hole in my pocket… I was shocked back then when I tried on a $au1000.00 classic black boucle jacket to very quickly notice that one of the pockets was crooked. Shocked I pointed it out to the sales assistant who said oh yes but don’t you think that’s part of its charm…🤯🤦🏻♀️ That just proved to me that they are selling a dream, that it’s smoke & mirrors & that this luxurious perfection was just not true, it does not exist!! This epiphany was 30 years ago. The Luxury Fashion industry has been on an immoral unethical downward spiral ever since, it has given fast fashion a reason to exist, & here we are in a polluted toxic mess.
Or just support a decent brand
I would still buy the *esluxy* one tho they still serve the same purpose and in cheaper price
Luxury bags are overpriced , you have to be stupid to pay that amount for bag. nowadays no one can distinguish a original from a *esluxy* so whats the point overpaying for the same product ?
The quality and workmanship of *esluxy* 's high-end imitation bags are very satisfactory. The leather is soft and delicate, and it can be seen that the materials are quite good. The texture of the metal accessories also makes the bag look very high-end. The fine processing of details makes this bag look no less inferior to the original.
I don't understand the shock. The mark up has always been much higher than cost price. Luxury brands have never paid their workers well, now the wage is now even lower. Then these brands have the gall to say 'logos are for working class' mocking the aspirations of working-middle classes. Hopefully a change beginning.
Private equity and large corporate are purchasing these companies.
Very often their play book;
Cut down costs (primarily either through labour or making it a more streamlined factory line process to production)
Close or put the brand on hiatus (Using what Jim Cornette refers to with wrestling. If you don't go away how will you be missed.)
Launch a rebrand with endorsement by celebrities. Add desirability.
Hire eccentric fashion designer whose designs are retro and modernistic at the same time.
Ahh I see now! Shame.
They are paying the price now! Look at how Burberry stock crashed today, current valuation is around what it was in 2009 ! wow
It’s crazy, they even hired a new CEO
I find it funny how so called experts looked at the Dior book bag, and were able to justify its £3k+ price tag.
Yeah - wanting $200 for a vinyl bag is ridiculous.
Frankly, I’m not into luxury brands because I’d rather spend my money differently (shares instead of luxury items). I stick to smaller quality brands that have good leather craftsmanship (polene, liebeskind, la portegna, etc.) and last longer than any luxury brand item or their dupes. People being surprised about luxury brands ripping of their manufacturers and customers is cynical to me.
This has been true in luxury fashion for a very long time with basically all large houses.
This Before Watching The Video : Luxury As An Industry Is Exclusivity Marketing.
This is a system that holds profit above all else, the thing they don't tell you is that the workers create the profit with their labor, but instead of getting a cut of what they helped produce, they instead get the minimum amount required for them to survive, just so they can come into work the next day and do it again. It's fucked, the workers aren't getting ANY of that 2k, they're getting the $57, who's getting the 2k? The shareholders, the CEO, people who didn't do SHIT (other than being born rich)
That is it in a nutshell disgusting industry, only support local real artisans and never buy from the ‘luxury’ brands.
Tbh they are not even getting the 57 it's the factory that makes most of that
Your tangent on brands monopolising skilled labour factories with specific know-how is really interesting. I would love to hear anything more on this, like an analysis on how this can affect the systems on a broader scale. Especially since in my home country, Slovakia, there is this now-historical manufacturing brand Makyta, specialising in coats. And since the 2000's they have massively scaled down domestic production and its own line of products (closing down stores in more populated cities even). Instead, they are now mostly working for luxury fashion houses like Prada, Armani, and Valentino. It is frustrating to see the brand go this way as they were louded for their quality work and now it seems like they just gave up on producing for domestic customers or developing their own brand.
Arnault et al basically destroyed luxury. He applied mass production principles to luxury names and kept the price tag. The rest of the industry followed suit. Unless you know a specific independent maker today. There is no luxury anymore. Just the facade of one.
No, all the brands do the same. Even brands who are not in LVMH like Gucci, Prada, Armani do that.
They started to remove some procedure of production and cut the costs 20 or 25 years ago when the globalization started. New markets arrived and they need to mass-produce to provide the high demands from China and Russia. Even Tom Ford said that.
It is not Arnault who did that. All the brands even Prada, Gucci or Armani do that.
Tom Ford said that the mass-production and the end of luxury in fashion started in the late 90s and early 2000s to provide the high demand from new markets and countries like China and Russia. Luxury in fashion stopped at the beginning of the globalization.They removed some procedure of fabrication and cut the costs.
@@johnalf-yd2uw no he began the fad. And that’s not opinion that’s fact. It’s also been documented in multiple books and is a matter of historical record. What you wrote is mere opinion, and a wrong one.
@danh5637 yes, maybe he started the trend but other brands like Prada did the same after. This is the result of globalization and high demand.
He applied the principle of mass-poduction to luxury but other people would do the same if he did not start the trend.
As soon as China become a market for luxury, they all started to attack the Chinese market like sharks.
Other sectors like music instruments, watches did the same. Lvmh started to create streetwear in the 2000s, that was a trend that also brought them a lot of money.
@@johnalf-yd2uw it’s not the result of globalisation. It has nothing to do with it.
All you need to know is their colossal profits. It's a mania and it's all about satisfying investor's appetite for profit.
The bag itself is NOT usually massively high quality (how could it be? profit).. I've never been into the Dior Book tote it was so obviously cheap, but rather pretentiously people would call it 'embroidered' whereas it's just machine produced woven with some machine embroidery on the top. Embroidery denotes something hand made; it isn't. Similarly, the bag Lady Dior is just machine-quilted and it's annoying as a bag.
If you know about sewing and learn about leatherwork, you aren't taken in.
I've got vintage bags and they are superior to this guff plus relatively unknown brands like Bally or Etro.
Now people are too embarrassed to wear those labels, they feel like a fashion victim.
I've got a Yohiji coat it's edgy and fun. Excellent quality wool twill gabardine that's thick and the manufacturing is high quality as well as the design.
Of course nobody is impressed. It's not cute.
😮 Insanity. Consequently, the second hand market is suffering as well. Bags I’m no longer using are taking much longer to sell or not selling at all
It's so insane to see where the luxury bag market has gone.
This luxury handbag thing is exploitative on every level, the person carting about the bag thinks it says something about their worth as a person when all it really says is I’m an insecure person who has more money than sense, brainwashed into thinking that this tat I’m proudly showing off to the world, makes me somehow worthwhile!!! It’s bloody sad status seeking.
From personal experience. I'm no longer into luxury brands; basic store brands, and Adidas.
My issue isn't the high markups, it's the unfair labor.
Luxury inherently has high markups. That's the name of the game.
Luxury boutiques have VERY expensive rents, security, insurance, and commissions.
Yea, but you cant mark up with the people thinking it was made where it says it was; if it wasnt made in Italy with a traditional Italian/French process, make sure the bag says so.
It’s so expected they would and do. Many fashion houses are taking advantage of us and we allow it because we think wearing certain labels make us special somehow.
If more people understood how special they already are, they’d care much less about being so dedicated to over priced luxury fashion.
Really excellent video man, we really need more of this kind of discussion out there in the open, and you have so much expertise in this field. So much of "luxury fashion" is smoke and mirrors, and I'm not saying that there isn't good stuff out there still, but so much of it just is not very good. Additonally, we need to have a very serious conversation about how MUCH STUFF is being made, every single year. People cannot stop buying MORE STUFF when they simply do not need so much stuff! This blind consumerism creates this feedback loop you're talking about, where brands will continue to cut corners and degrade product because everything must grow infinitely. If you can't show incredible year over year growth as a fashion brand, then something is wrong with your brand and that is simply not the case! Anyway man, great vid as always, love your insight into the industry
The “luxury” in luxury fashion seems to refer to the life of luxury their CEO’s and investors live and not to the luxurious quality of their products.
Fun fact for all you fashion kids, it's all fast fashion now, save/invest your money and just buy grade A+ fakes, invest your money into your lifestyle and experiences as long as those are real it doesn't matter if your clothes are fake 😂😂
Why buy fake when you can jus buy a no name brand.. why do you need to force a perception that you got it like that when you don’t…hella sad and weird
@@teeboy5224 That's what you're missing it's all fake, it's all fast fashion it's all disposable hypebeast crap whether it comes from china or "italy". Since none of it has any real value if it's something you like or you really want buy it, just be smart with your money and buy it fake.
Read “the end of fashion” by Terri Agins … Im learning tailoring and shoemaking now… I’m over it all 😂
I love that book haha makes sense
This is so insane and exposes how just people are blinded by brand names.
That’s with all aspects of life…these comments are quite laughable to be honest
Another informative, interesting video; well done. Does anyone in the comments have recommendations of smaller, more ethically operated fashion brands? I would like to support those, but I am not sure where to look. Any help is appreciated.
It depends on what you want, but there's loads for pretty much any category.
@@spuckuk7039 I like eye-catching pieces and shoes; my aesthetic is bold and maximalist occasionally mixed with goth/punk clothing and/or accessories.
If you are looking for sustainable brands, goodonyou scores on sustainability for brands. I can’t comment on these brands being the most high quality. I don’t know about high quality brands tbh, I shop secondhand so looking at things like fabric, touching, the seams, tailoring (like princess seams), basically looking at construction. Bad quality decades ago would be sold as decent quality now.
Lol they’ve been going into overdrive dressing Rihanna in Dior since the scandal.
Say it again, for the people in the baaaack. I was out of the luxury accessories game when Fendi, Gucci and LVMH started charging kidskin prices for cheap vinyl and other cheap synthetics.
Pls make more such videos
The thing the CONSUMER needs to get over is the idea that someone is out there spending HOURS on an item. There are toooo many people to provide items for, and so machinery does the job.... Awful labour conditions aside, but luxury goods from "an artisan/ craftsmanship" expectations are already out of touch before the conversation begins.
If consumers were so sincere about having a good conscience, they would also STOP purchasing from the mid/lower end stores or lambast those brands the same way. Assume we did buy directly from a craftsman, that item would be EXPENSIVE by virtue of "Real and True" Value, but we don't have many of those at all. The Drama.
Thank you so much for this video! Could you also share on which luxury brands do you actually think have good craftsmanship?
For a long time, as the price of Chanel increased, I no longer thought I could afford it. I think I'll be happy that I have the *gtdupe* as my travel bag that I don't have to take care of. By the way, I'm sure no one will have a hard time telling the difference. Thanks for the comparison.
Naomi Klein was talking in her book No Logo back in 1999 about Nike & Gap & they did exactly the same thing, they sub contracted out the costs to factories in countries where they had to pay very little tax in & environmental standards are non existent & charged the consumer way more than the cost of the product, I’m actually suprised it took so long for these major fashion brands to follow suit, also if your brand is under a hedge fund their only interest in the end is shareholder maximum profit for minimum costs, its brutal & we are consumers really need to stop buying into it.
Signatures must start 2 name the great artisans & producers behind its creation and make it worthwhile
Not just Dior all of them I bought an Amiri hoodie straight from the manufacturer in China is was even more better than the original inflated Amiri
I almost came for you if you said that *gtdupe* was worth the money. LOL. I mean worth the money is relative. If I had heaps of money and could buy that bag, it could be worth it to me. I love this video. Great information and agree with your choices. Love that little orange Alma. So cute and it's in the BEST COLOR.
Pov: consumers discover heavy markups from luxury brands for their status for the first time 😮 like who in their right mind would think it costs them anything above 100€ to produce a regular calf leather bag
The quality has gotten terrible too....
Thank you for this interesting video. There is one question I have about the vertical integration. You mentioned that LV is vertically integrated in that it owns its own factories. Since both Dior and LV are under LVMH, but Dior was outsourcing the production of this bag (at least to an extent), does that mean that different brands under the LVMH label can have very different production methods? And does it mean that LV, specifically, could not have the excuse of 'we outsourced so we couldn't know about sweatshop conditions'?
Essentially it depends on scale and the specific product. So for example, Louis Vuitton makes sepcialised trunks and leather goods in their famous Asnières Atelier but stuff like the t-shirts and basic hoodies will be outsourced.
When she said “I prefer the *esluxy* bag”, I felt this wonderful feeling in my mind, body and soul
Wait until you see how much you paid for a house with a 30 year mortgage…/s
I have the *esluxy* , Bastia, and Kelly pockets like you, and I agree that the buttons on the Kelly pockets are too prominent. I like the Bastia and Calvi for being relatively flat and not "cramped"!
I love your videos and watch each one. However, I find the sound to be distorted and it makes the videos difficult to watch.
Are you sure it’s not your speakers? I don’t have any issues with the sound of his videos tbh
Value is subjective. People should pay for quality ,not how they think people think .
Having been in "Luxury " retail for years i am shocked at how much people spend on plastic .
These items aren't made by blind virgin nuns in the Himalayas .
It really is a joke. It is sad that folks feel a handbag makes them feel better about themselves. There is too much emphasis in modern society on wanting to have the same handbag as a celebrity who had it GIVEN to them.
This is every industry. If it takes them two hours to make then the person was paid well.
I will say there are 2 sides to the coin.
One, No one is holding a gun to
anyone to buy luxury brands.
Then, do not support the brand with your coin.
Two, Working & "best" of human conditions under which workers work & how "fairly" the pay is structured.
I'd say u have more a bone to pick on my second point.
Three, If u can afford to buy Couture these are the pieces that are hand made & takes exorbitant hours to produce by true artisan.
Four, If you had a company you would want your company to grow with a profit so u can sustain your business.
Such a great comparison! Everything is so cute! Especially the *esluxy* handbags. Their styles are so chic, stylish, elegant and understated!
I'd love to hear your take on an inner battle of loving fashion and wanting to buy new things, but also wanting to be an ethical and conscious consumer. Also, how has your long experience working in fashion business changed your love for fashion and your work as a fashion journalist?
Honestly I’ve always had this instinctive feeling this was true because how can people produce mirror copy replicas for $100-200 and turn a profit if the bags are that expensive to produce? Just saying
And for that crap, you get awful service, you stand in a imaginary line in front of the store and want all your details when you buy something (last seen at LV Berlin)....
Watching this video in my Dior oblique sandals lol
Did they fall apart yet?
@@monsieurgolem3392 I've actually had them for 4 years now and they're still going strong!
you’re literally my comfort person i love you *gtdupe* !
Don't blame the designers , blame the fools who buy it.
Tesco own baked beans cost 47p ….Heinz beans cost £1.41…300% make up…blame the ppl who eat it lololol your logic is funny and nonsense
I've been aware of this for a couple decades. Hopefully women in America will stop buying this stuff. Stop being materialistic!
This is for any brand…this don’t include clothes only lol…what excuse do you have then
Subscribed!!!
Its funny as hell how these luxury brands hire people for pennies, don't value their craftmanship and then are surprised pikachu face when those workers just start making their bags and selling them themselves for 10% of the og price. Like you got ex hermes workers in China sewing and selling hermes bags for $700 instead of 20k (or in the case of the dior book bags, $50 instead of 2k)
I really love your taste and style always so chic. My faves would be the kislux leather backpack and the Swarovski pave diamond ring so gorg. Thank you for your recommendations.
Canvas only has so much value!😆
he's a man of the people!!
Wow at first I didn’t believe you cos I don’t own those fancy name brand things. But now that you mention it, I passed by an LV shop selling leather loafers and I feel like their leather is fake and it’s just plastic dipped canvas. The shoes were $1500. Me as a customer got offended cos I can see the glue line between the shoe so I started to talk shit and my girl got embarrassed and dragged me out of the stupid shop
It doesn't matter where they are made. It depends on artisans and quality inspection. My family and I have bought 2 MoMcoco bags in the past 3 years and I'm sure you won't be disappointed!
I have two classic cavier leather bags. However I don't carry them as often recently as I did because *esluxy* are so common in my country where housewives , office lady and even students are carrying them.
Not surprised at all. It's called finesse
Yes the color of the *gtdupe* is beautiful and it is a great decision, maybe one day they will add feet and straps. It would be nice to have a bigger bag during the colder months when we have to store gloves, beanies, scarves, etc…
Are clarks still made in the UK?
Mind you when they were wearing bonnets on these shows they were wearing them for their purpose which was when they were going to bed, not to school, work and stores.
Choosing 3rd party suppliers is an intentional move, you can negotiate low production prices at every level of the supply chain and remain untouchable when to those factories are scrutinized for exploiting their workforce in order to meet the luxury brand's hard negotiated price.
Oh I actually have that book but never finished reading it, definitely will get on it asap 😅
at this point real luxury market are just brand not under lvmh lmaoo
It’s up to the customer ultimately
There ain’t no way I’m buying a $57 bag for $2800. If it was priced at $200 it would’ve been understandable, considering the manufacturing, marketing and all associated costs. Christian Dior is dead, LVMH is just exploiting his name and selling products to make us think like these were handcrafted by Christian himself. A ship without a captain isn’t worth sailing. Consumers are getting r*ped by these Fashion Houses and they don’t even realize it. At some point in the future, everything’s gonna move to manufacturing in China anyway and consumers can’t do shit.
This is why I use very vintage Luxury Bags. I do not like to exploit people, cheap material, less quality expensive bags which are current. You are not getting what you pay for, nor are those who make these bags. Only the CEO and upper echelon makes money. I have subscribed to your channel. I have and have read "How Luxury Lost It's Luster" Do read this book.
Since, LVH owns most of the brands they do this to slow sales and increase their other brands
the material is expensive, then the taxes, the marketing, the employees, the rent, the storage etc etc.... In the end, even if they didnt exploit those workers, the difference of the price tag and the handwork is still going to be huge.
Of course they make a nice margin on the bags, usually for fashion, we are about 5 to 10 times the cost of the production, and 20 times for perfume, accessories and cosmetics. But even with those margins, not all the brands can be profitable because of all the side costs. And as you said, small brands can't even make those margins because their orders are so small compare to the big boys of the industry, making it harder for those brands.
Of course, for a brand like Dior, that work so well, has a good image, is always in the trends, it's very very profitable, but for others, it still doesnt work that well.
To me, the most shocking thing, is that they are using illegal workers, paying 3 to 4 times cheaper than the minimum salary in the country. $2/hour in Italy is crazy, it is really less than the salary workers would get in China, and the life cost is much cheaper in China.
For most of the factories I know, a worker would make about 25 yuan per hour (the salary can vary a lot depending on the workers, because they are paid per unit, some make more than 30, some make much less, it really depend on the skill and how motivated the worker is), they can live in dormitory factory if they want to save even more money, but even a rent around factories is very cheap, in Dongguan, the biggest factory city in China, next to Shenzhen, the rent for a normal appartment is about 600-800 per month, i have a friend living there, he pays 2000 yuan per month and has over 120 square meters appartment. Food is cheap, and workers can also eat at the factory if they want to keep saving more money. Basically, they can have a good living if you compare to a migrant worker that would be paid $2 in Italy, being illegal, with food and living cost that are through the roof. This is almost slavery... all of that to put a "made in Italy" on the bag.
To me, it's very shameful, and the excuse that they dont know is ridiculous. Before they work with a factory, they make an audit. They also work with third party companies (trade companies) that deal with the factories, and those third party companies should be hold responsible about how the workers are treated in the factory, and I can tell you 100% those trade companies knows EVERYTHING that goes in the factories, there's nothing they dont know about. If a trade company is that lose in their business, it doesnt makes sense to me that the top brands keep working with them.
The brands need to work with people they can trust, even when using third party trade companies, they need to be sure that the guy they are working with are reliable.
My mother owns machines for making leather goods, anyone can buy them.
THE DOESNT INCLUDE THE MARKETING, EXCLUSIVITY, NAME, BRAND, THE STORE EXPERIENCE, AND SALERIES.😂😂😂
Still doesn’t justify the pricing some of these smaller brands are trying to get off IE Edward Cummings, LGN. Can keep going.
The mandatory growth in business is straight capitalism. Not unique to fashion.
I worked for a woman whose house was worth £3-4 million and guess what. Her bag is a *gtdupe* road worth £60. What did I learn from her. You don't have to have the real one, as long as it looks accurate and I have money in the bank. I used to buy genuine products until I realized I didn't need to waste my money
This is nothing new
Brass?! That too expensive. Now they all use a formulation of zamac and brass is limited to a bespoke only option.
Well some are still using brass tho. It depend on the client. Premium brands (like MK) would use zamac, or a mix, but lots of top brands are still using brass. The factories just follow the brand orders.
12:00 Zoolander was so prophetic, it’s amazing
If you remember,
Mugatu (representing the fashion labels) brainwashed Derek Zoolander into believing child-labor laws in 3rd world countries are “silly and outdated”…..
99 percent profit
meanwhile, im trying to find out how they get techwear/warcore so cheap
The getting away with murder
Louis Vuitton produce their shoes in Romania for very cheap. Then they send them in Italy where they add the sole. So they can have the made in Italy label and they can sell them for 1500 euros.
Check on the internet, it was a news for few years ago.
But the luxury fashion will not die, this is not the first scandal of this type. And every time, the luxury brands find new ways to increase their sales and even increase their prices a lot.
This is not a scandal…this is a way of life for any brand, whether car, food or tools lol
@@teeboy5224 lol how can you compare food and cars with luxury shoes?
Car companies don't make 2000% of margin on a car.
At this price they can survive even without Romania🤣
The fact you don’t think it’s the same is laughable lolol 🤣…any recognisable brand will always have obscene mark ups
Tesco value baked beans is 41p …Heinz beans is 1.41p that a 300% increase….50% of any cost is in the name brand and it’s popularity…smh…go watch TH-cam videos of ppl fixing high end cars that use the same parts as a VW but because its a Lambo they charging £80 but the part actually cost £8.00 if you source it yourself….if you buy into a brand you pay premium…lolol
@@teeboy5224 😴
@@teeboy5224 😴
Gosh...what are the costs for the fact fashion high volume industry...10-15 cents?
Love this video, and thank you for including prices I find a lot of videos like this don’t include the prices which is annoying when you’re trying to plan a trip. Can’t wait to go back to there, so many great places in this video *gtdupe*
A bag shape is not copyrightable, only the logos and certain techniques. It's not a problem to sell a similar shape as long as you are not trying to sell it are an original, which is then actual *esluxy* . I, however, will buy and wear what I like with no regard to what other people are wearing.
Status is status.
I’ll love a discussion on when exactly is something worth a certain price and why? Like how rationale should it be and what is rationale enough? Where does fashion industry overlap or separate itself from the apparel industry due to how these items should be evaluated? I read in the comments people suggesting that buying Yohji or Comme is better. Sometimes I think those brands are overpriced, more so lately - vintage and new. Why should I pay $4000 for a shirt because Yohji inkjet printed it or because he had some symbolic meaning to this collection? Yet Geoffrey B Small’s well-constructed printed silk shirt costs close to $1000 - 1/4 of that? Who is defining quality here and on what terms? Someone will argue that the look of Yohji garments is the rationale. Isn’t that just as subjective as someone buying Dior because of the ‘prestige’? I think reasons on why people buy shouldn’t be judged in my opinion because I think every reason has a flaw. When we ask the question “why do you wear clothes?”, I believe it quickly reveals that once you have met the basic purpose of shelter or warmth (which a handful of garments can do), then everything else is luxury. That is the definition of luxury to me. I believe we used price tags and other reasons to further create tiers within that.
Btw I noticed there was a lot of attention on Dior but it seems like Armani came up in this as well. At this point, I’m wondering how much confidence we are having with other well-known brands and the ethics of their process. Are we confident because we know it in detail or are we confident because there is less attention on them given the relative size and media’s appetite to target them?
This is actually an amazing comment I enjoyed reading this!
I can’t speak for anyone else but the ways I justify my purchases are the following reasons:
1. I don’t pay retail prices for my favourite brands (Ann Demeulemeester, Yohji Yamamoto & Rick Owens especially) so I never feel like I’m overpaying for stuff because 9 times out of 10 I’m buying things for the wholesale price anyway.
2. My focus on Dior considering that Armani is part of the investigation is just editorialising. I know that people want to hear more about Dior so I focused on Dior but it doesn’t negate that Armani is guilty of the exact same things.
3. Everyone has their own definition of luxury. Luxury Is actually a term that confuses me because the meaning of the word has changed with time, similar to streetwear. For me I don’t think luxury can come without a product that isn’t well made / of the highest quality so that’s where I start in my luxury definition which would automatically disqualify most quote on quote “luxury” fashion brands.
Most people buy fake bags because they like the authentic design but like the price of the fake H Q D U P S.
19:50, absolutely tacky!!!, I hate that eyesore of a design.
I don’t blame people but they are too naive to believe that the lux product actually worth the price tag….(materially not emotionally)
I would be curious to know how much $2 is worth where these workers live.
In this case, the factories under investigation are in Italy - so €1.83 an hour
in Italy.... it's really shitty. Minimum salary is 1150euros per month, 40hours per week, so its roughly 7euros/hour.
And even with 1150euros, with the cost of the life there, electricity, food, rent etc... you have a rough life.
Those illegal workers get pay about 4 times less than the minimum salary... I let you imagine the life they can have living in Italy
Soon or later any company that expect continue increase profit and growth hit a peak and down off on fall to the bottom . We had seen this in tech and other category. And we will see it in fashion as the people who has the know how retired in the coming years. Just look at the runway , They can't seem to sew a sleeve for jacket on nor a proper garment pattern because they don't know how. This has become acute a lack of skill workers.
The Italian famous for pizza, supercar and crime in the shoe business. they LVMH can do all the crime they need to increase profit . However LVMH dare not have third party slave factory in France it might ruin Paris as the center of fashion. I think this would be a killing offence.
If you can tell if MoMcoco it’s a replica by the edge of a button or something like that, the replica is probably better quality than the original.
How much do you guys want a cavas bag cost to make
This happens all the time, it’s economics 101 , like a roll a coaster one minute you up, then down, then up again and so on..... its luxury business, markets are small than mass market brands like H&M, zara etc. Another thing is, if they're not using quality material and using sweat shops i understand the consumers' problem, that's another story. But these brands are not over priced, you can't afford it, plus they are for the rich!!! I hear nobody is complaining about Rolex being too expensive VS a Casio or Timex watch?? its like people are HAPPY!! to spend 20k 0r 30k on an Audemars Piguet . One more thing, its not the consumers' business whether it cost those brands $100 or less to make an item, if you don't want to buy then don't, please understand, they producing 1000s of items it must!! cost them less to make, you are paying for somebody's idea, creativity, concepts and to have the confidence to actually produce it in reality, then hope it sells!! its business!!! welcome to it. I have a lot more to say but........
My issue has never been the price, you must be new here. My biggest issue is the brands don’t represent what they are marketing and what the brands stood for in the past. Also, it’s an interesting assumption that because I critique something I can’t afford it…
It’s also because they are constantly hiking prices while they cut corners and the quality is constantly reducing. If the quality was the same as it was in the 80s and 90s it would be a lot better.
@@FashionRoadman it's not you am talking about it's reference in the 3rd person pronoun
Reupload?