Luxury brand Chanel could lose a significant amount of its revenue and profits in 2020 due to the coronavirus crisis.
The next 12 to 18 months would be particularly tough for the brand as a strong recovery in countries where the group’s shops have reopened could not make up for the lack of international travel.
Like rivals, Chanel had to shut shops across the globe and idle manufacturing sites as the virus first emerged in the sector’s key market of China and then spread to the rest of the world.
Some 85 per cent of the group’s stores have now reopened and Blondiaux said Chanel had seen sales rebound in China - by over 100 per cent in some weeks. Shoppers were returning in Paris, Milan and Berlin.Consultancy Bain says the $310 billion luxury goods sector is on course for a sales fall of up to 35 per cent this year.
Chanel, which still expects to turn a profit this year, is reducing advertising and promotions by more than a quarter, cutting production and has cancelled or transformed some events like fashion shows this year, including by streaming them online.
