RICHEMONT TO STRENGTHEN LEATHER & FASHION?
Really? Johann Rupert wants to strengthen the fashion segment? Even if that was the case, his "new" management would certainly not be a strong driver of that change. Fashion and leather are NOT at the core of Richemont´s world - they are not part of its DNA. And for decades, this "weakness" compared to more "glamorous" luxury (fashion) brands was the strength of Richemont. They key to substantially higher margins and higher value of inventories. Richemont transforming itself to an (ultra-)fast fashion player? Forget it. Bloomberg is wrong. Yes, they will try to capitalize on the accessible-luxury growth, and leather might be an additional way to do this. (Apart from positioning Mont Blanc as an Jaeger LeCoultre "light" and other interesting recent initiatives at Richemont.) But there is still substantial potential in the global watch & jewelry markets, which are at the core of Richemont´s DNA. So it´s not about diversification. They need to realign the offering with the next generation. And to initiate a cultural change of corporate values in a group which certainly needs a fundamental transformation. But that will most likely only be initiated when the next, deeper crisis will arrive.