Luxury leather goods and alternative leather: Risk and growth opportunities

The global luxury market faces challenges from multiple sources. The landscape has changed with a shift towards more online selling. While this helped the luxury goods sector during the pandemic it also exposed consumers to more choices, allowing them to discover new brands and exposing them to competitive pricing. Shifts in consumer attitudes around sustainability and ethical consumption can have an impact on the desirability of products, particularly leather goods. As luxury brands rely so heavily on leather goods this can put them at a disadvantage as consumers delve deeper into the environmental, social and corporate governance (ESG) performance of luxury brands. A shift to alternative raw materials is underway and this will offset risks, benefitting the larger groups.