New taxation in France to wipe one percent from Hermes profitability
Speaking about the new corporate tax policies as put in place by France’s President François Hollande, Patrick Thomas, CEO of Hermes said in a recent interview: “We think the combination of these new taxes will cost us one percentage point in terms of profitability by the end of the year”.
However, the label remains sure of its ability to attract customers. Changes to its manufacturing locations will allow the capacity of its leather goods factories to increase 10 percent a year to help meet demands for handbags that often have long waiting lists. Within the next two years, the company plans to increase its silk-printing capabilities by 40 percent.
The brand plans to expand globally rather than to inundate the Chinese market with new boutiques, though additional storefronts will gradually arrive in China – perhaps one or two a year. Hermès opened one store in Taiwan this year and plans to open another in Wuhan, China, during the fourth quarter. Hermès saw its sales in Mainland China rise 28 percent during the first six months of this year, according to CEO Patrick Thomas.
adapted from WWD