While NM sold the likes of LVMH here it mostly made money by selling comfortable middle market rather than the top tier luxury because of the buying agreements:

While NM sold the likes of LVMH here it mostly made money by selling comfortable middle market rather than the top tier luxury because of the buying agreements: The way the buying is structured, retailers cannot complete with flagships of the luxury brands they carry within a certain distance which means that the stored NYC, LA, Boston, SF, Miami which should be the most profitable can't carry the hot items of the seasons if the flagships carry them. Since flagships are not just retail but marketing and demo stores flagships always carry all the hot items. The mid-tier market outsourced manufacturing to the same factories that at best create wear it a couple of times before it falls apart products while charging 3x-10x of the likes of Zara. That market has been shrinking for years as the likes of Zara, H&M and others cleaned up the lower end and started moving up. Also the lion's share of luxury growth is coming from outside of the US, namely from Asia which is not accessible to NM.