{
  "id": 16034268,
  "title": "True rarity, short supply chains, and made-on-demand models: What today’s luxury brands can learn from the pre-1990s",
  "url": "https://urgent.news/2026/10/22/true-rarity-short-supply-chains-and-made-on-demand-models-what-todays",
  "topic": "business",
  "section": "Business",
  "published": "2026-10-22T10:20:00.000Z",
  "source": {
    "name": "Fast Company",
    "slug": "fast-company",
    "url": "https://www.fastcompany.com/91618422/true-rarity-short-supply-chains-and-made-on-demand-models-what-todays-luxury-brands-can-learn-from-the-pre-1990s-technology-leadership-innovation-luxury"
  },
  "original_language": "en",
  "account": "Luxury brands have enjoyed robust growth over the past three decades, with LVMH briefly becoming Europe's most valuable company in April 2023. However, most luxury giants have since lost momentum, with Estée Lauder's stock price falling 35% in 2024 and Hermès down 34% this year. The core issue lies in the structural nature of luxury's troubles, as the playbook that once drove success is now a hindrance. The contemporary luxury model has reached its limits, suffering from an innovation recession, reputational recession, technological disruption, and commoditization.\n\nFirstly, luxury brands are increasingly relying on heritage and iconic products, like the Hermès Birkin bag and the Kelly bag, rather than creating new desirable goods. These timeless models have accounted for over 13% of Hermès' annual revenue, raising questions about the sustainability of such a model. Second, luxury has experienced a reputational recession due to post-COVID price increases that far outpaced functional value improvements. As societies become more economically polarized and inflationary costs rise, consumer numbers have dwindled, with Bain estimating a loss of 70 million consumers between 2022 and 2025. Additionally, the super wealthy are now more interested in exclusive experiences, like owning a house on a pristine coast, than purchasing \"artificially rare\" luxury products.\n\nThirdly, technological disruption is accelerating in sectors like automobiles, with innovative Chinese players like NIO and Yangwang challenging established luxury brands. In China, these companies already pose a threat to giants like Lamborghini and Mercedes-Benz. Luxury's commoditization is further exacerbated by the industry's common playbook, which focuses on mass-marketing intensity, standardized retail experiences, global scale, and offshored, industrialized supply chains. Brands now hide abundance behind the narrative of scarcity and have placed less emphasis on craftsmanship in their communication. In contrast, the world has seen an unprecedented number of billionaires, yet the number of historic fashion houses showcasing haute couture in Paris has dwindled to just three, out of the eight that existed in 1990.\n\nEnvironmental degradation and social polarization further underscore the need for change in the luxury industry. While some progress has been made in ESG (environmental, social, and governance) efforts, the majority of emissions still come from outside the company's operations, and only a quarter of top companies have set absolute reduction targets. Sustainability has become more of a compliance and reputational exercise rather than a source of strategic innovation. Ultimately, the deeper issue lies in the luxury industry's dominant growth model, which has reached its limits. The solution is not merely an improved version of today's model but a fundamentally different approach that returns to pre-1990 practices and invents new ones for the 21st century. Luxury should prioritize on-demand production, reduce inventory, and focus on selling products that customers genuinely desire. Additionally, implementing repair, refurbishment, and upgrading services can create new revenue streams. By adopting these alternative models, luxury brands can restore desirability, maintain social license to operate, and address the environmental and social challenges that plague the industry.",
  "summary": "Luxury brands have witnessed three decades of unprecedented growth. In April 2023, LVMH, home to the likes of Givenchy and Guerlain, even briefly became Europe’s most valuable company. Since then, most luxury giants have lost momentum. Estée Lauder’s stock price has shed 35% since the start of 2024 . Hermès has lost 34% so far this year, and shares in Richemont, owner of Cartier and Chloé, have…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}