Welcome to our post about Everything you Need to Know About Chanel Price Increases!
You have probably heard about the recent price increases of Chanel, in the last 12 months Chanel has increased its prices 3 times! While most luxury brands increase their prices once or twice a year, Chanel’s increases are motivated by something other than just inflation. Chanel handbags are highly sought-after, iconic statement pieces, and demand is always higher than supply. Thus, Chanel continues to boost the prices of their most coveted offerings, and consumers will continue to pay. Chanel bags on the resale market are known to maintain top resale values, and this is unlikely to change.
So here I’ll show you everything you need to know about Chanel’s price increases, and make sure to check my post about Chanel bags that are worth collecting!
This post is inspired by a Sotheby’s article, which is one of the best luxury auction houses in the world, so make sure to check out their Chanel selection!
So, without further ado here is Everything You Need to Know About Chanel Price Increases:
Understanding the Investment Return of a Chanel Bag
In a drastic rise, the price for a Chanel Medium Classic Flap bag has increased from $1,150 in 1990 to $7,800 in July 2021. And, after a few other price increases, the Chanel Medium Classic Flap is now $8,800. If you consider the average of the last 30 years, the price of a Chanel bag grew 6.5% each year, but in the last 5 years the average value growth was of 10%! During the last five years, Chanel has consistently increased prices on its most popular handbag styles, from the Classic Flap and Boy Bag to the recently debuted Chanel 19. And that makes the prices on the resale market increase as well.
A Luxury Price Boom
On July 1, 2021, Chanel shook the fashion industry, announcing that the prices for some of its most iconic handbags would be raised once again. This price increase would boost the price of Chanel bag models, like the Classic Maxi Flap, by up to 15 percent. This decision marked the third round of price adjustments instated by Chanel since the pandemic began. The striking increase that went into effect on November 3rd would mark the fourth.
Yet, the gradual price increase of Chanel bags is not a stand-alone phenomenon. Luxury prices have been skyrocketing for decades, at over twice the rate of inflation. In a typical year, luxury brands like Chanel are expected to raise prices at least once or twice, largely in accordance with factors like material and labor costs. Moreover, price harmonization across global markets is a big part of the puzzle.
In order to increase tourist spending, luxury price tags have been much higher in key Asian markets like China and Japan. Emerging from the worst of COVID-19, with customers eager to shop and top luxury players motivated to make up for lost revenues during lockdown, the Chanel price adjustments at hand are just one facet of a much greater trend in the world of luxury fashion. Meaning the luxury price boom is a reality for all luxury brands, even if Chanel is the one at the forefront.
The Future of Chanel Handbags
Chanel handbags are highly sought-after, iconic statement pieces, and demand is always higher than supply. Thus, Chanel continues to boost the prices of their most coveted offerings, and consumers will continue to pay. Since the start of the global pandemic, Chanel has boosted bag prices four times. The first spike came in May 2020, when the luxury fashion house increased the price of certain bags – including the 11.12, 2.55, Boy, Gabrielle and Chanel 19 – from 5 to 17 percent. Just five months later, in October 2020, Chanel boosted handbag price tags an additional 5 percent. By July 1, the price of styles like the Chanel 19 would be up an additional 10 percent, and the Flap bags another 15 percent. And, as of November 3, the Classic Flaps and 2.55’s are quoted at 12-15 percent more than they were just three months ago.
In the words of the Chanel brand itself, “the price of a Chanel bag reflects not only a sense of exclusivity, but also our values. Buying a Chanel bag brings with it renowned expertise and French design, an unfailing commitment to preserve skills and craftsmanship, leading-edge innovative manufacture, and guaranteed provenance of the raw materials.” Evidently, the price hike of select Chanel purses adds to the allure of the brand, as more expensive directly correlates to more exclusive. And the price increases aren’t the only obstacles Chanel costumers will face when buying a Chanel bag.
The Availability of Chanel Bags
Popular styles, such as the Chanel 11.12, also called the Classic Flap, are nearly impossible to acquire through walk-ins and are only available for pre-sale. Chanel is putting a strict limit on the number of bags that consumers in certain markets can buy over a one-year period. Is reported that in Korea, for example, you can only buy one Classic Flap and one Coco Handle per year.
This is again an attempt to increase the desirability of their bags, and is very likely that this will become a worldwide policy in no time.
Impact on the Resale Market
Ultimately, it will take years to establish the true value of Chanel handbags on the luxury resale market, as impacted by the most recent price booms. Already, the days of finding a preloved Chanel bag on the secondary market for less than retail seem long over, regardless of the bag’s condition. You have to understand that in almost the same rate as the prices increase in Chanel stores, the prices also increase in the secondary market. Chanel bags on the resale market are known to maintain top resale values, and this is unlikely to change. If anything, the increase on demand on the secondary market helps Chanel successfully boost prices, as consumers can rest assured that there is a thriving market in place, should they want to resell in the future.
The combination of price increases and decreased inventory on the primary market led to the rise of Chanel handbag pricing on the secondary market. It will be fascinating to see if resellers can ultimately charge Hermès-like prices on Chanel purses, as worldwide prices continue to rise.
So if you are thinking of buying your dream Chanel bag be quick! Prices will only continue to rise, and you can be sure that your bag will resell extremely well in the secondary market!
Hope you enjoyed our post about Everything You Need to Know About Chanel Price Increases! Make sure to check out The Most Iconic Chanel Bags!