Europe’s wealthiest man, Bernard Arnault, is spending long hours plotting a post-virus future for his luxury goods empire, LVMH. He has experienced many pandemics but no a quite like this one. At 71, he claims that with his business empire of 70 brands, he has hit by all the sides from Dior to Fendi.
In a virus-shaken world, Arnault heads to his war place for categorizing the projects, holding up real estate deals and few blockbuster acquisitions, discussions over video calls with his team to reopen factories and boutiques.
But as the corona-virus outbreak and lock-down measures to contain it plunge the global economy into its worst crisis since World War II, Arnault’s wealth has lowered. With LVMH shares down 19% this year, his net worth has shrunk by more than $30 billion -losing more money than any other individual in the world. He has lost as much as Jeff Bezos has gained over the months.
Most of Arnault’s fashion boutiques around the world have shut down for more than a month, leading to billions in missed revenue in his most profitable division. Also he is on hook to pay Tiffany & Co. for the acquisition in between all the crisis. His brands, margins, retained cash pile gives him the flexibility not just to move out of the situation but to keep expanding the business.
LVMH’s strategy has often been to spend big to win big. As Arnault is known to be a risk taker as whenever he feels the momentum and the right potential he uses all his resources and exploit the opportunity in the best way possible.
Shops including most Sephora, Dior and Louis Vuitton locations are set to reopen, as well as the Bon Marche department store. As one of the associates stated that the order are filling in just two hours with barries being installed at the registers. It will not take much time to recover the revenue with all the planning and plotting in mind.