Industry Analysis & Industry Trends
Demand for handbags and accessories weakened over 2008 and 2009 as consumers in recession-hit countries held off on non-essential spending. However, producers of the highest end luxury products reported somewhat resilient demand during this period. Demand for higher priced, luxury products rose in countries such as China. Many Europe-based companies, such as LVMH, are placing a greater focus on the Asian market as incomes in the region rise. IBISWorld forecasts that industry revenue will grow at an average annual rate of 5.1% over the five years through 2011, to $8.9 billion. The high average growth rate is in part due to the effects of currency conversion into US dollars. In 2011, revenue is expected to grow by a slower 2.0%... read more
Industry Investment
IBISWorld estimates that a typical firm within this industry uses 5.6 units of labor for each unit of capital. This indicates a medium level of capital intensity. Many of the production activities require human intervention, such as cutting, sewing and the finishing of products. Although automation has increased, some steps in the production process are difficult to automate. Automation tends to occur in more developed countries. At the same time, however, manufacturers of high quality handbags, wallets, purses and accessories are highly labor intensive as they can require products to be individually hand stitched and assembled. Consequently, the level of automation depends upon styles and the type of product... read more