Richemont SWOT & PESTLE Analysis
COMPANY PROFILE -Richemont
Business Sector :Fashion and Lifestyle, Luxury Goods
Operating Geography :Switzerland, Europe, Global
About Richemont :
Compagnie Financière Richemont SA, also known as Richemont, is a Switzerland-based luxury goods holding company. It was founded in 1988 by a business man Johann Rupert, after it got divested from the international assets owned by Rembrandt Group Limited of South Africa (now known as Remgro Limited). It has its headquarters in Bellevue, Switzerland and serves countries worldwide. It produces and sells jewelry, watches, leather goods, pens, firearms, clothing and accessories. The company owns some of the world’s most prestigious luxury goods companies, each of which has a proud history and heritage of craftsmanship and design. The company comprises of four divisions: Jewellery Maisons, Specialist Watchmakers, Montblanc Maison and Other. The Jewellery Maisons segment engages in the designing, manufacturing and distribution of jewellery products which include Cartier and Van Cleef & Arpels. The SpecialistWatchmakers segment includes timepieces by Piaget, A. Lange & Söhne, Jaeger-LeCoultre, Vacheron Constantin, Officine Panerai, International Watch Co., Baume & Mercier, and Roger Dubuis. The Montblanc Maison segment engages in the design, manufacture and distribution of writing instruments. The Other segment comprises the activities of Alfred Dunhill, Lancel, Chloé, Net-a-Porter, Purdey, and the textile brands and other manufacturing entities of the group. The group works towards an objective of growing value for shareholders in the long run. Each company that it owns is focused on increasing awareness and desirability by developing creative products and leveraging great marketing programs.Compagnie Financière Richemont SA USP or unique selling proposition lies in being the ultimate holding Company for some of the world’s leading luxury goods companies, its Maisons - have almost all have had a running for more than a century
Richemont Revenue :
€14,238 million – FY ended 31s March 2020 (year-on-year growth of 2%)
€13,989 million – FY ended 31s March 2019 (year-on-year growth of 27%)
€11,013 million – FY ended 31s March 2018
Competitive Analysis of Richemont
| Strengths | Weaknesses |
| 1. One of the world’s leading luxury goods groups with prestigious brands 2. Wide regional and central functions operations 3. Global presence with sales distributed across major markets 4. Partnerships and acquisitions to strengthen its position | 1. Destruction of unsold inventory by the company leading to major losses |
| Opportunities | Threats |
| 1. Growth of luxury goods and wrist watch market 2. Leveraging digital technologies through expansion and collaborations 3. Global wealth growth – providing a strong tailwind | 1. Impact of COVID-19 outbreak on luxury sales 2. Competition from lower priced premium brands 3. Fluctuation in cost and quality of raw materials such as precious metals and stones 4. High-end smartwatches and wearables eating into luxury watch market. 5. Increasing counterfeits harming brand reputation |
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Detailed SWOT Analysis of Richemont
Strength
1. One of the world’s leading luxury goods groups with prestigious brands: Richemont is one of the world’s leading luxury goods groups. It includes a handful of the most prestigious names in the industry. Some of its prominent brands include Cartier, Van Cleef & Arpels, Piaget, Vacheron Constantin, IWC, Montblanc and many more. The jewelry and special watchmaking companies excel in manufacturing and design. Owing to the high quality and great craftsmanship of the various products, it enjoys a strong brand recognition across the globe. A huge brand portfolio consisting of such high brands helps the company to attract and retain customers thus growing profitable.
2. Wide regional and central functions operations: Richemont’s functions are spread both regionally and centrally which enables its well-known brands to enter even more markets easily. These brands are then helped by the in-house tools support teams and development initiatives. The regional functions are well spread across the globe. The Group thus excels in sales across all the countries it operates. It further works towards empowering the local market teams to establish client-centric, entrepreneurial and cross-functional initiatives which will help in fostering business development and engagement.
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Weakness
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Opportunity
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Threats
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Major Competitors :
- Louis Vuitton
- Gucci
- Bulgari
- Rolex
- Omega
Major Brands :
- Buccellati
- Cartier
- Piaget
- Panerai
- Watchfinder & Co
- Peter Millar
- Purdey
- Serapian
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References used in Richemont Analysis Report
1. Richemont gloomy about economic prospects for next three years -
https://www.reuters.com/article/us-richemont-results/richemont-gloomy-about-economic
-prospects-for-next-three-years-idUSKBN22R0P4
2. Annual Report ans Accounts 2019 -
https://www.richemont.com/images/investor_relations/reports/annual_report/2019/ar_fy2019_a8rnc73bd29jwd.pdf
3. 4 Major Challenges Facing The Luxury Market In 2020, And Opportunities For Brands That Lean Into Them -
https://www.forbes.com/sites/pamdanziger/2019/12/20/4-major-challenges-facing-the-luxury-market-in-2020-and-opportunities-fo
r-brands-that-lean-into-them/#5eb2b49a176d
4. Yellow Vest Protests, Sluggish Watch Sales Dent Richemont’s Q3 Growth -
https://wwd.com/business-news/financial/yellow-vest-protests-sluggish-watch-sales-
dent-richemonts-q3-growth-1202955098/
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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Richemont SWOT & PESTLE analysis has been conducted by Sushree Lasyamayee and reviewed by senior analysts from Barakaat Consulting.
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