© Reuters. VUITTON ACCELERATES THE DEVELOPMENT OF ITS PRODUCTION
by Pascale Denis and Sarah White
SAINTE-FLORENCE (Vendée) (Reuters) – Louis Vuitton, the main profit centre of LVMH (PA:LVMH), accelerates the development of its production capacity in France to be able to respond to a strong demand particularly from the chinese customers.
The flagship brand of the luxury group, including the number of workshops remained stable between 2011 and 2017, is preparing to open its fifth factory in France by July, in the Vendée, and provides for the opening of two new sites by 2019, of which one in the beginning of the year in Maine-et-Loire.
“With the two workshops that we are going to open in July 2018 and January 2019, we will create a total of 500 jobs,” said Tuesday to the press, Emmanuel Mathieu, the industrial director of Louis Vuitton, on the sidelines of a visit to one of the workshops of the brand, to Sainte-Florence (Vendée).
Each workshop has approximately 250 employees and the fine leather has a total of 3.500 people in the country today.
The claw, which also has two sites of production in California dedicated to the u.s. market, plans to open a third, in Texas, in the course of 2019.
She also holds four factories in Spain, mainly devoted to small leather goods, as well as two sites in Romania and Portugal, specialized in the manufacture of parts such as the buckles of the bags.
It still has use, for a small part, of the leather French sub-contractors, as well as third-party manufacturers in France and Italy for its famous canvas monogrammée.
With the explosion of sales, in particular with the asian clientele, Louis Vuitton has evolved its model of manufacturing.
“We have learned to adapt as quickly as possible, depending on the success encountered by products,” explained Emmanuel Mathieu.
To make production as agile and fast as possible, employees have become versatile and can move from one workstation to another. For more flexibility, the workshops are closed the month of August and have introduced staggered hours.
The delay between an order placed at the workshop and the delivery of the products in the shops has been reduced to two weeks instead of four a few years ago, and the goal is to reduce it to a week.
Furthermore, to avoid unnecessary inventory, manufacturing adapts to the application, depending on the levels of sales in the stores. Louis Vuitton thus prefers to manufacture bit, in the beginning, and then adapt according to the evolution of the application.
The “Capucine” or the “Twist” will remain among the best-sellers of the brand.
“Our choice, this is to bring to customers a renewal that meets their expectations. We attach a huge importance to the speed of response,” said Emmanuel Mathieu.
The chain, known for its efficiency, is then used to deliver the stores in two or three days, thanks to a decade of warehouse logistics throughout the world.
Louis Vuitton, whose sales are estimated at more than eight billion euros by analysts, runs at full speed.
The brand has signed a double-digit growth in 2017, taking advantage particularly of the rebound in chinese demand, which accounts for 30% of its turnover.
She took advantage of the opening of its latest flagship in the place Vendôme in Paris, and harvesting the fruits of a strategy that has paid off by offering a very wide range of products and pricing in a market driven by the middle and upper classes of emerging countries.
Louis Vuitton figure, with a handful of competitors such as Gucci (owned by Kering (PA:PRTP)), Hermes (PA:HRMS) or Moncler (MI:MONC), among the claws, which are gaining market share, and sign the best performance in the sector.
Hermès, which increases its production capacity by approximately 8% per year, is poised to open its 16th factory in France.
(Edited by Dominique Rodriguez)