it bag prices up
IT BAG PRICES UP S
orry, bagaholics. It will now take you even longer to save up for that Chanel bag you have been coveting. Popular fashion blog Madison Avenue Spy reported last month that the French house would raise the prices of all its bags by 20 to 30 per cent on Aug 1. The news was then picked up by New York Magazine’s online blog, The Cut. So while the Chanel signature flap bag cost $4,850 for the big model last year, the price is now $6,230, a jump of $1,380 or 28 per cent. In Paris, the jumbo Chanel Classic Flap in calf skin retailed for 2,045 euros (S$3,515) last month, but now costs 2,550 euros (S$4,392) – an increase of $868 or about 25 per cent in just a few weeks. Civil servant Julia Tan, 32, experienced first-hand the rise in prices when she bought a medium-sized Chanel Classic Flap bag recently from the Chanel boutique in London. “When I checked last month, it was selling at 1,600 pounds (S$3,353), before the tax rebate. After the price hike, however, I paid 2,045 pounds (S$4,286) for it,” she says. “I could have saved about $1,000, which could have been used to buy another bag.”
PRESERVING THE BRAND While it is common for luxury brands to adjust their prices on a yearly basis, the increase is usually by a single-digit percentage point. Chanel declined to comment, but Dr Michel Phan, LVMH-Chair professor of marketing at the Singapore campus of French business school ESSEC, says the double-digit price rise could be Chanel’s way of preserving its brand image as the weakening euro means more Asian tourists are finding it cheaper to shop in Europe and hence, snapping up its bags. “To compensate for the weakening of the euro, luxury brands can either sell more to counter the loss of profits or they can increase their prices,” he says. “Brands like Chanel can afford to increase their prices as they have a strong market presence. Simply selling more would be counter-productive as it would dilute the brand’s image.” Agreeing, Serene Neo, founder of Singapore-based luxury online shopping site Kepris, says a price increase works in the favour of luxury brands rather than against it. “In the luxury goods market, a price increase can fuel a greater
Snagging that Chanel bag may prove to be even more difficult, thanks to price fluctuations. ROHAIZATUL AZHAR reports
demand as it increases exclusivity,” she says. Not all customers are complaining though. Luxe bag lover Nurbeeha Omar, 26, for one, welcomes the heftier prices. The flight attendant, who counts her jumbo Chanel Classic Flap as one of her favourites, says that the low euro exchange rate in the past few months had made Chanel bags accessible. “Everywhere you turn, someone is carrying a Chanel as if it were a casual day bag. It’s a luxury bag and it should remain exclusive. That’s why we pay top dollar for it.” Other luxury labels such as Louis Vuitton and Gucci, however, show no sign of raising their prices. A check with the boutiques here found that prices have remained consistent this year. One designer brand has even trimmed its prices. At French fashion house Balenciaga, its popular Motorcycle bags now cost between $300 and $500 less than what they did early last month. Its Work bag, part of the Motorcycle range, is now about $2,300, down from $2,700. Club 21, which owns the distribution rights to Balenciaga here, declined to comment. However, it is believed that the label is aligning its prices with the falling euro, which has lost about 20 per cent of its value against the Singapore dollar over the past month. The current exchange rate is 1 euro to S$1.719. With the low exchange rate of the euro and British pound, smart shoppers have been going to Europe and picking up bags more cheaply there. In any case, some would say toting a bag that has cachet is worth any price, no matter how much they must scrimp and save and play the forex game. As Neo notes: “More people now do their research and look for better deals in the form of exchange rate gains, spree shopping deals and through discount shopping sites.” [email protected]
Japanese actress Rinko Kikuchi looking regal with a Chanel signature flap bag.
LUXE SAVINGS Urban susses out the cheapest places to get four popular luxe bags
CHANEL JUMBO CLASSIC FLAP Price in Singapore: $5,890 Price in Paris: 2,550 euros (S$4,392) Price after 13 per cent VAT return: 2,218 euros (S$3,812) You save: $2,078
MIU MIU BOW BAG Singapore: $2,260 Paris: 720 euros (S$1,237) After 12 per cent VAT return: 633.60 euros (S$1,089) You save: $1,171
LOUIS VUITTON NEVERFULL Singapore: $1,100 Paris: 515 euros (S$885) After 11 per cent VAT return: 458 euros (S$787) You save: $313
BURBERRY CADET BAG Singapore: $2,595 London: 895 pounds (S$1,876) After 13 per cent VAT return: 778 pounds (S$1,630) You save: $965 * All prices correct at time of printing. * Prices for luxury items are generally the same in major European capitals like Paris, Frankfurt and Milan. It is, however, usually cheaper to shop in Paris because of the higher VAT (Value-Added Tax) returns. * Europe’s VAT is similar to the goods and services tax (GST) here and tourists can claim it back at the airports on departure. Depending on the prices of your purchases, tax returns vary between 8 and 15 per cent. The more expensive an item is, the more VAT you can claim. So the VAT returns can work out to quite a substantial discount. PHOTOS: AP, BURBERRY, CHANEL, LOUIS VUITTON, MIU MIU
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orry, bagaholics. It will now take you even longer to save up for that Chanel bag you have been coveting. Popular fashion blog Madison Avenue Spy reported last month that the French house would raise the prices of all its bags by 20 to 30 per cent on Aug 1. The news was then picked up by New York Magazine’s online blog, The Cut. So while the Chanel signature flap bag cost $4,850 for the big model last year, the price is now $6,230, a jump of $1,380 or 28 per cent. In Paris, the jumbo Chanel Classic Flap in calf skin retailed for 2,045 euros (S$3,515) last month, but now costs 2,550 euros (S$4,392) – an increase of $868 or about 25 per cent in just a few weeks. Civil servant Julia Tan, 32, experienced first-hand the rise in prices when she bought a medium-sized Chanel Classic Flap bag recently from the Chanel boutique in London. “When I checked last month, it was selling at 1,600 pounds (S$3,353), before the tax rebate. After the price hike, however, I paid 2,045 pounds (S$4,286) for it,” she says. “I could have saved about $1,000, which could have been used to buy another bag.”
PRESERVING THE BRAND While it is common for luxury brands to adjust their prices on a yearly basis, the increase is usually by a single-digit percentage point. Chanel declined to comment, but Dr Michel Phan, LVMH-Chair professor of marketing at the Singapore campus of French business school ESSEC, says the double-digit price rise could be Chanel’s way of preserving its brand image as the weakening euro means more Asian tourists are finding it cheaper to shop in Europe and hence, snapping up its bags. “To compensate for the weakening of the euro, luxury brands can either sell more to counter the loss of profits or they can increase their prices,” he says. “Brands like Chanel can afford to increase their prices as they have a strong market presence. Simply selling more would be counter-productive as it would dilute the brand’s image.” Agreeing, Serene Neo, founder of Singapore-based luxury online shopping site Kepris, says a price increase works in the favour of luxury brands rather than against it. “In the luxury goods market, a price increase can fuel a greater
Snagging that Chanel bag may prove to be even more difficult, thanks to price fluctuations. ROHAIZATUL AZHAR reports
demand as it increases exclusivity,” she says. Not all customers are complaining though. Luxe bag lover Nurbeeha Omar, 26, for one, welcomes the heftier prices. The flight attendant, who counts her jumbo Chanel Classic Flap as one of her favourites, says that the low euro exchange rate in the past few months had made Chanel bags accessible. “Everywhere you turn, someone is carrying a Chanel as if it were a casual day bag. It’s a luxury bag and it should remain exclusive. That’s why we pay top dollar for it.” Other luxury labels such as Louis Vuitton and Gucci, however, show no sign of raising their prices. A check with the boutiques here found that prices have remained consistent this year. One designer brand has even trimmed its prices. At French fashion house Balenciaga, its popular Motorcycle bags now cost between $300 and $500 less than what they did early last month. Its Work bag, part of the Motorcycle range, is now about $2,300, down from $2,700. Club 21, which owns the distribution rights to Balenciaga here, declined to comment. However, it is believed that the label is aligning its prices with the falling euro, which has lost about 20 per cent of its value against the Singapore dollar over the past month. The current exchange rate is 1 euro to S$1.719. With the low exchange rate of the euro and British pound, smart shoppers have been going to Europe and picking up bags more cheaply there. In any case, some would say toting a bag that has cachet is worth any price, no matter how much they must scrimp and save and play the forex game. As Neo notes: “More people now do their research and look for better deals in the form of exchange rate gains, spree shopping deals and through discount shopping sites.” [email protected]
Japanese actress Rinko Kikuchi looking regal with a Chanel signature flap bag.
LUXE SAVINGS Urban susses out the cheapest places to get four popular luxe bags
CHANEL JUMBO CLASSIC FLAP Price in Singapore: $5,890 Price in Paris: 2,550 euros (S$4,392) Price after 13 per cent VAT return: 2,218 euros (S$3,812) You save: $2,078
MIU MIU BOW BAG Singapore: $2,260 Paris: 720 euros (S$1,237) After 12 per cent VAT return: 633.60 euros (S$1,089) You save: $1,171
LOUIS VUITTON NEVERFULL Singapore: $1,100 Paris: 515 euros (S$885) After 11 per cent VAT return: 458 euros (S$787) You save: $313
BURBERRY CADET BAG Singapore: $2,595 London: 895 pounds (S$1,876) After 13 per cent VAT return: 778 pounds (S$1,630) You save: $965 * All prices correct at time of printing. * Prices for luxury items are generally the same in major European capitals like Paris, Frankfurt and Milan. It is, however, usually cheaper to shop in Paris because of the higher VAT (Value-Added Tax) returns. * Europe’s VAT is similar to the goods and services tax (GST) here and tourists can claim it back at the airports on departure. Depending on the prices of your purchases, tax returns vary between 8 and 15 per cent. The more expensive an item is, the more VAT you can claim. So the VAT returns can work out to quite a substantial discount. PHOTOS: AP, BURBERRY, CHANEL, LOUIS VUITTON, MIU MIU
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