Invest in Hermès

Investing in luxury handbags is a relatively new trend that has piqued the interest of many, including those who have nothing to do with the world of fashion.

Indeed, luxury handbags are an emerging category on the alternative investments spectrum, offering a high potential for exquisite returns. Helping you maximise that potential is Splint Invest, through which savvy investors can purchase alternative assets. 

Learn how to invest in luxury handbags with us, and leverage the potential lying in handbag investments!

Why invest in luxury handbags?

A recent Financial Times article highlights luxury handbags' rising status as an investment, captivating high-net-worth individuals and young clients. Demand for top brands like Chanel, Hermès, and Louis Vuitton has surged, driving significant growth. Iconic models have doubled in price over a decade, becoming collectables.

But what makes luxury handbags so alluring to savvy investors? There are multiple reasons behind their popularity, with the main ones being their growth potential and low correlation to traditional markets. Reasons common for most alternative assets. 

The growing market

In 2022 the global luxury handbag market was valued at 30.1 billion USD according to Straits Research. By 2031, it’s expected to reach a staggering 50.9 billion USD, growing at a CAGR of 6.01% during the forecast. 

Those are impressive numbers that clearly show the potential lying in luxury handbag investments. 

The famous Knight Frank’s luxury investment index also proves just how a great addition to your portfolio handbags can be. According to this index, luxury handbags have increased in value by 67% from 2014 to 2024, leaving behind such popular assets as jewellery, coins, or coloured diamonds. 

A great example of that is Hermės, one of the most famous brands in the fashion accessories industry has been raising its prices on average by 1.5 to 2% each year in line with inflation

 

 

Value appreciation

If you’re not a fashion expert, it can be difficult to understand the reasons behind such impressive numbers associated with luxury handbags. Well, there are several reasons why luxury handbags have become a popular investment option. 

One key factor is limited production. Many luxury brands intentionally create handbags in small quantities. This scarcity fuels demand and drives up the price of the bags.

High-quality materials and expert craftsmanship further contribute to the investment potential of luxury handbags. These bags are built to last, using luxurious leathers, precious metals, and meticulous construction techniques. This combination of quality and durability makes them not only beautiful but also desirable long-term investments.

Finally, iconic designs from renowned brands tend to hold their value or even appreciate over time. Classic styles from Chanel, Hermès, or Louis Vuitton are timeless and never go out of fashion. This enduring popularity ensures that these bags remain in high demand, making them a potentially lucrative investment.

Low market correlation

Similarly to many other alternative assets, luxury handbags aren’t directly linked to stock markets. They would still be expected to increase in value in a bear market caused by recession or inflation. Furthermore, they are one of the most stable asset classes with annualised volatility between 2% and 7%.

That makes luxury handbags an excellent option for portfolio diversification. Due to its low correlation to traditional markets, handbag investments could even potentially serve as a hedge against inflation during times of economic uncertainty, protecting your portfolio from excessive losses. 

Handbag investments vs other alternative assets

Luxury handbags aren’t the only alternatives you can invest in through Splint Invest. On our platform, you can also purchase luxury watches or fine wine. But would they be a better option than luxury handbags? 

Here’s handbag investments compare to investing in luxury watches and fine wine:

Feature	Handbags	Watches	Wine
Potential for Appreciation	Moderate to High - Rare, limited-edition handbags can appreciate significantly, especially from brands like Hermès or Chanel.	High - Limited edition and rare watches, especially from brands like Rolex and Patek Philippe, can appreciate substantially.	High - Fine wines, particularly those with high demand and limited supply, can significantly appreciate in value over time.
Liquidity	Moderate - Can be sold via auctions, consignment, or private sales, but the market size is smaller than for wine or watches.	High - Very liquid, with robust markets and global demand, making it easy to buy and sell.	High - Strong, well-established secondary market with auction houses and wine exchanges.
Storage & Maintenance	Moderate - Requires careful storage to avoid damage and preserve condition; dust bags and proper climate control are essential.	Moderate - Regular servicing is needed to maintain function and value; careful storage is essential to avoid scratches or damage.	High - Requires specialised, climate-controlled storage to maintain quality; improper storage can ruin the wine.
Enjoyment of Asset	High - Can be worn and enjoyed as a fashion statement while retaining value.	High - Can be worn and appreciated daily, combining fashion with function and investment.	Low to Moderate - Enjoyment is primarily in the knowledge of owning a rare asset, as consumption negates investment value.
Investment Expertise	Moderate - Requires knowledge of brands, limited editions, and market trends; easier to enter than wine or watches.	High - Requires understanding of brands, models, historical significance, and market trends; expertise is key for significant gains.	High - Requires extensive knowledge of vintages, producers, and storage; expert guidance is often needed.

Potential pros & risks of investing in designer handbags

 

Pros

Cons

High Appreciation Potential: Rare and limited-edition luxury handbags, particularly from iconic brands like Hermès, Chanel, or Louis Vuitton, can significantly increase in value over time. Tangible and Enjoyable Asset: Unlike stocks or bonds, handbags are tangible assets that can be worn and enjoyed, allowing investors to derive personal pleasure from their investments. Strong Brand Reputation: Top luxury brands maintain a strong global presence and consistent demand, which helps support resale value. Resilience During Economic Downturns: Certain designer handbags, particularly from well-established brands, have shown resilience during economic downturns, retaining or even increasing in value when other assets falter. Limited Supply: Many high-end handbags are produced in limited quantities, creating scarcity that can drive up prices on the secondary market. Growing Market: The market for second-hand luxury goods is expanding, with increasing consumer acceptance of pre-owned luxury items, which enhances liquidity.

Authenticity Issues: The prevalence of counterfeit goods poses a significant risk. Ensuring the authenticity of a handbag is crucial, as fakes can severely impact investment value. Storage and Maintenance Costs: Proper storage and maintenance are essential to preserve a handbag's condition, which can be costly and require specific conditions (e.g., climate control, dust bags). Illiquidity: While there is a market for luxury handbags, it may take time to find a buyer, especially for less iconic or less in-demand models. Depreciation: Not all handbags will appreciate in value; some may depreciate, especially if they fall out of fashion or are not in pristine condition. High Entry Costs: Luxury handbags often require a significant upfront investment, and the most desirable pieces can be prohibitively expensive. Fickle Market Trends: Fashion trends are unpredictable, and what is considered valuable or in demand today may not be in a few years, impacting the long-term value of certain handbags.

 

Risk factors to consider

Be vigilant when shopping for the right luxury handbags to invest in. Here are some of the most significant risks to consider when considering investing in designer handbags:

Damaged item: The handling and storage of luxury handbags are crucial in maintaining their fundamental value. However, in case of unforeseen events such as human errors, fire or natural disasters, the handbags can be damaged or destroyed. Excessive use can also heavily affect how a handbag looks. The more damaged it is, the lesser its investment value. 

Counterfeit pieces: Due to the popularity and exclusivity of luxury handbags, counterfeit pieces are not uncommon on the market. As the popularity of the category increases, the issue will become even more paramount.

Market conditions: Following a set of due diligence and market research, investment-grade assets are identifiable. Nevertheless, paying the right price for the asset is a challenge and therefore poses a risk of acquiring the asset at a price premium.

ESG: Currently, the entire fashion industry is under the microscope in the context of ESG. CO2 footprint and usage of water are heavily criticised. This poses an additional regulatory risk. However, in the luxury segment, the margins tend to be much healthier which provides the premium brands with the possibility to adapt while remaining profitable.

How to find the best handbags to invest in

Once you understand all the reasons for and against investing in designer handbags, it’s time to make your first decision of the evening. Should you invest in luxury handbags? If the answer is yes, you must then find the right handbags to purchase. 

Here are several tips on how to do it right and maximise your chances for future returns:

Research iconic brands

The first rule is to focus on iconic brands like Hermès, Chanel and Louis Vuitton. These brands produce handbags that consistently appreciate over time, known for their craftsmanship, exclusivity, and strong resale value.

Also, remember that within these brands, certain styles have iconic status. For example, the Hermès Birkin and Kelly, the Chanel Classic Flap, and the Louis Vuitton Speedy are known for their enduring appeal.

Look for limited editions

It shouldn’t come as a surprise that bags that are part of limited editions or seasonal collections often have higher resale value due to their rarity. The same goes for discontinued models, which often become highly sought after, especially if they were popular before being phased out.

Follow fashion and market trends

Keep an eye on resale platforms, auctions, and fashion news to understand which bags are currently in demand and which are likely to increase in value.

Also, don’t underestimate celebrity influence. Celebrity endorsements and appearances can boost the popularity of certain bags. Bags worn by influential figures or featured in high-profile events often see a spike in demand.

Another good idea is to engage with online communities, forums, or social media groups dedicated to luxury handbag collectors. These can provide insights into market trends and investment tips. And if all that fails, don’t hesitate to seek professional help from the luxury handbag industry and investment experts. 

Evaluate craftsmanship and materials

Handbags made from premium materials like exotic leathers (crocodile, alligator, ostrich) or those with intricate detailing often have higher investment potential. The level of craftsmanship, including hand-stitching and attention to detail, also contributes massively to a bag’s longevity and desirability.

Most popular luxury handbag brands to invest in

Not all handbag brands are born equally. Some companies are well renowned for their quality and timeless design. Investing in those offers the highest potential for high returns. 

What brands and models do we have in mind? Let’s take a look:

Hermès

Hermès is the gold standard in luxury handbag investments, with its iconic models like the Birkin, Kelly, and Constance leading the way. 

The Birkin is perhaps the most coveted handbag in the world, known for its exclusivity and craftsmanship. Made from the finest leathers and often featuring precious metals and stones, Birkins have a history of appreciating in value, especially rare and limited editions.

The Kelly, another timeless piece, is celebrated for its elegant, structured design. Like the Birkin, it has shown strong appreciation, particularly in unique colours or exotic leathers.

The Constance bag, with its sleek and minimalist style, could also be a valuable investment, particularly in limited editions or exotic materials. 

 

Chanel

Chanel is a name that needs no introduction, even for those not interested in the world of fashion. And as you would suspect, Chanel's reputation for timeless elegance makes its handbags strong contenders for investment. 

The Classic Flap bag is probably the most recognisable model. Famous for its quilted leather, chain strap, and iconic CC logo, is a staple in the fashion world. Over the years, it has seen consistent price increases and remains a favourite among collectors. 

The 2.55 Reissue, a modern version of the original Chanel bag designed by Coco Chanel herself, is another solid investment. With its historical significance and enduring appeal, it has a robust resale market. 

Another valid option is the Boy Bag which comes with a more contemporary design. It offers a bold, structured aesthetic that appeals to a younger audience. However, while it’s trendier than the Classic Flap, it still holds strong value, making it a worthwhile addition to an investment collection.

Louis Vuitton

Louis Vuitton's handbags are synonymous with luxury and durability, making them excellent investments. 

The Speedy, one of the brand’s most recognisable designs, has been a favourite since the 1930s. Vintage Speedy bags, especially those in good condition, often retain or increase in value. 

The Neverfull, a versatile and practical tote, is another popular model. While not as rare as other luxury bags, its consistent demand ensures strong resale value. 

The Alma, known for its structured shape and distinctive silhouette, is available in various materials, including the signature Monogram canvas. Certain versions, particularly in Epi leather, are highly sought after, making the Alma a valuable piece for collectors and, as a result, for investors as well. 

Dior

Dior’s handbags, especially the Lady Dior and Saddle Bag, are highly regarded in the luxury market. The Lady Dior, with its elegant design and association with Princess Diana, is a symbol of sophistication. Its strong resale market, particularly in limited editions, makes it a high-potential investment. 

The Saddle Bag, with its unique shape and equestrian-inspired design, has seen a resurgence in popularity. Its revival has made it a trendy yet iconic piece, offering moderate to high investment potential, especially as it continues to capture the attention of fashion enthusiasts.

Gucci

Gucci's rich history and contemporary appeal make its bags desirable for both fashion lovers and investors. The Jackie 1961, named after Jackie Kennedy, is a classic hobo-style bag that has recently been reintroduced with modern updates. Its vintage appeal and association with a fashion icon have made it a sought-after collector's item. 

The Dionysus, with its structured shape and distinctive tiger-head closure, is another popular model. Although more trend-driven, the Dionysus maintains a strong resale value, making it a solid choice for those looking to invest in contemporary luxury.

Fendi

Fendi’s Baguette and Peekaboo bags are among the brand’s most iconic offerings. The Baguette, often referred to as the "first It bag," gained fame through its appearances in pop culture, particularly in shows like Sex and the City. Its ongoing popularity and frequent re-releases in new styles make it a valuable investment. 

The Peekaboo, known for its structured design and versatile appeal, also holds a consistent place in the resale market, especially in classic colours. Both bags represent a blend of classic design and modern appeal, making them potentially worthwhile investments.

How to invest in luxury handbags

Finding the right luxury handbag models and understanding the risks is only one side of the coin. Another is deciding how you wish to invest in such handbags. Contrary to what you might think, it’s a bit more complicated than just going to a store, purchasing a bag, and waiting for it to appreciate in value (although it’s still a valid option). 

Let’s go through some of the most popular ways of investing in designer handbags:

Buying from authorised dealers & official stores

Authorised luxury handbag retailers specialise in selling high-end designer handbags. They often have physical boutiques or online platforms showcasing exclusive collections from top brands like Hermès, Chanel, and Louis Vuitton. 

Reputable retailers offer guidance on handbag selection, market value, and collectability. They also guarantee authenticity, ensuring that the bag you purchase is genuine.

However, buying from authorised retailers often comes with a premium. Prices can be significantly higher, with markups reflecting the exclusivity and condition of the handbag. Despite this, if you want absolute assurance of authenticity and quality, purchasing from an authorised retailer is your safest bet.

Buying from the secondary market

The secondary market refers to platforms where pre-owned luxury handbags are bought and sold. This includes online marketplaces dedicated to luxury goods, auction houses, and forums for handbag enthusiasts and collectors. 

These platforms often offer a wider selection of handbags than traditional retailers, sometimes at more competitive prices. You might find vintage or discontinued models that have appreciated in value.

However, it’s crucial to conduct thorough research and consider using third-party authentication services to ensure the handbag's authenticity before purchasing. The risk of counterfeits is higher in the secondary market, so due diligence is essential.

Owning stocks in luxury handbag companies

This method involves investing in publicly traded companies that own or manufacture luxury handbag brands. For example, you could invest in companies like LVMH (which owns Louis Vuitton) or Kering (which owns Gucci). 

By owning shares in these companies, your investment benefits from their overall financial performance and growth in the luxury market.

This approach allows you to gain exposure to the luxury handbag industry without needing to purchase individual bags. However, the value of your holdings will fluctuate with the stock market, which can be volatile. 

If you prefer the tangible experience of owning a luxury handbag and aren’t comfortable with stock market risks, this might not be the best investment strategy for you.

Investing in luxury handbag investment funds

The final method for investing in luxury handbags is through specialised investment funds. These funds pool money from multiple investors to purchase and manage a collection of high-end handbags. Managed by professionals, these funds handle the selection, buying, selling, storage, and insurance of the handbags within the portfolio.

Investors purchase shares in the fund, gaining exposure to a diversified collection of designer handbags. This approach might be appealing to those who lack the time or expertise to manage their handbag collection. 

It also requires a much lower initial investment compared to buying handbags outright, where top-tier bags can cost thousands. However, the most significant advantage of such funds is that they allow you to participate in the luxury market with a smaller financial commitment. With Splint Invest, for example, all you need to start investing in luxury handbags is as little as €50.

Invest in designer handbags with Splint Invest

Investing in luxury handbags can be a savvy financial decision. With their ability to retain and even appreciate in value over time, designer handbags offer a unique way to diversify your investment portfolio. 

These high-demand, timeless pieces can act as a hedge against inflation and market fluctuations, safeguarding your assets while potentially delivering strong returns. 

Invest in handbags with Splint Invest, and enhance your portfolio of alternative investments with guidance from the industry's leading experts. Create your account today and unlock the incredible potential of luxury handbag investments!