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Wednesday, May 31, 2023

    Why is LVMH called recession proof? How has it grown to become a $500 billion powerhouse


    Credit LVMH

    LVMH (LVMHF) continues to post high sales and revenues while other companies have seen stock falls, low sales and even bankruptcies. Moët Hennessy Louis Vuitton (LVMH) is now a $500 billion powerhouse. The luxury goods giant saw a revenue of about $86.3 billion in 2022 and has also expanded its stores, its locations as well as its staff while many other giants have been closing stores, cutting staff and facing low sales due to high inflation.

    CEO Bernard Arnault has devised strategies over the years that seem to have paid off as the company continues to grow and increase its position among the top companies in Europe as well as make its founder the richest man in the world. Some experts call LVMH “recession proof.”

    LVMH has 75 distinguished brands that are called “maisons.” It is known for luxury and sought after brands for sectors including jewelry, luggage, designer clothes, bags, watches, champagne and more.


    The Paris-based company is not only known for its jewelry and clothing brand but is also a popular manufacturer of champagne.

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    Although it is difficult to pinpoint the exact reason for the growth of the company, some believe that longevity is one of the major factors for the company to see not only sustained but also an increase in growth. LVMH also builds on established brands that have long legacies. It builds brands that excel and innovate as they continue to remain relevant.

    LVMH also stays ahead by delivering merchandise that marries the old with the new. It uses famous celebrity stars, young influencers, upcoming actors and actresses to grow its established brands among the younger generation while maintaining classic looks for the rich who are older.

    Designing unique jewelry items, clothes, and footwear as well as adding new items such as watches and giving consumers different brands under the same parent has been successful for LVMH. Although it remains the manager, each maison has control over its individual brand. Each brand has its own C-suite executives as well as its own mission that helps to increase both productivity and accountability.

    LVMH has truly proved to be recession proof as it expands its brick-and-mortar stores, its global staff and its acquisition of established brands, the latest being the jewelry brand Tiffany & Co.

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    LVMH, the French fashion conglomerate, reports record profits


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