Altagamma predicts 20% decline in luxury goods sales this year
Luxury goods analysts and consultants at Bain and Altagamma have published findings of a report that looks at how the covid-19 pandemic has affected luxury goods consumption.
Unsurprisingly, all categories and areas have been hard hit and the consultants expect an average 20% fall in sales this year, globally.
Of the sectors, leathergoods showed slightly more resilience than others.
President of Altagamma Matteo Lunelli said: "The pandemic has immediately hit the high-end industry worldwide and will lead to a 20% drop in turnover in 2020. However, the sector will start again and the long-term trend remains positive with a growth of 2-3% between now and 2025.
“The Italian creative industry, endowed with unique manufacturing, creative and entrepreneurial resources, has the credentials to revive itself and return to exercising its world leadership. However, there are some priorities: in the short term, the protection of supply chains in difficulty; in the medium term, the digital transformation, the revitalization of tourism - which is strategic for all sectors - and an even stronger focus on environmental and social sustainability.”
The Altagamma Consensus 2020, developed in collaboration with 22 international analysts, estimates Europe (-29%) and the Americas (-22% in the North and -21% in Latin America) will see the greatest falls due to their longer exposure to the crisis and the absence of international tourist flows, especially Chinese.
As for products, the worst impacts are estimated for jewellery (-23%), watches (-25%) and clothing (-21.5%), while for leathergoods (-17%) and cosmetics (-13%) the drop will be less.
Stefania Lazzaroni, general manager of Altagamma, said: “The Altagamma Consensus with the estimates of 22 analysts foresees a sharp decrease in world consumption and a profitability of the companies in the sector down by 30% in 2020. A strong positive sign is the performance of digital channels + 16% and wholesale + 12%. The digital transformation of companies will certainly be enhanced and the crisis will lead to new lifestyles - more sustainable, moderate and aware - whose interpretation will be decisive for the relaunch of the top of the range.”
