The Truth Behind the Chanel Quota Rumors

Editor’s Update Oct 28th:
For the latest price increase information
Read: Chanel Price Increase for Classic Flaps on November 3rd

Photo credit: Chanel

The New Quota

Editor’s Update Dec 7th, 2021

Interestingly… Chanel finally addresses the state of its quotas. Or rather, denies actual quotas, terming it instead boutique decisions to “to share the products between as many customers as possible” according to voguebusiness.com. According to Bruno Pavlovsky, president of Chanel Fashion, the issue stems from not enough goods to satisfy demand in various locations. And, it various from city to city:

“The situation is very different from one city to another. When you are in Korea, you need to be consistent throughout the city of Seoul for example. That’s why when they are making this kind of commercial approach, they are trying to be as logical, or consistent as possible with all boutiques, all fashion advisors and all customers.”

This explains the variety of tales of limitations. Vogue Business’s own survey exposed, for example, some of the following ‘quotas’: one bag per month in Palm Beach, FL; no limit in Shanghai; and one bag per month at Bond Street boutique in London. 

Editor’s Note October 15, 2021

Unlike the word from Chanel in the United States, there are reports of a purchase limitation in South Korea, and perhaps other Asian countries. According to Chanel in Korea (as cited in yahoo.com), this quota took effect October 10 and applies to Classic Flap and Coco Handle bags, as well as small leather goods. Think of it as “one bag per customer per year.”

While it seems counterintuitive for Chanel to essentially sell fewer bags, in this instance Chanel has a bigger long-term goal: stemming the huge quantity of its goods flooding the secondary market, as well as the proliferation of counterfeits. 

Although the real target is the reseller rings that buy out merchandise for their own stores, even smaller individuals who load up on the hottest items hoping to make a quick buck (or won) will be affected. Indeed, one could argue that the latter will be hurt the most. After all, the big reseller organizations can just send more agents to purchase. 

As for those of us buying for our own use, well, find a friend, relative or significant other to buy for you. No doubt, some of our significant others will be pleased with Chanel’s new policy. 

Well, well, well, if it isn’t Chanel making heads turn (again). Except this time, it’s the rumor mill and headline at hypebeast.com. Blasting news that “Chanel Limits Purchases of Most Popular Handbags to One per Customer Each Year”, it certainly got everyone’s attention.

Except, it’s not quite accurate. Fortunately. Our sources confirm that you may purchase more than one classic flap, for example, per year. However, handbags are more difficult to obtain than they once were.

We confirmed that the monthly limit on certain popular bags:
1 handbag (fashion or icon) per month (no more than 2 of the same style/sku annually).

Now, as is often the case, we expect many ardent Chanel buyers will circumvent these quotas. How, you wonder? Well, by being that loyal, all-around customer committed to purchasing from multiple Chanel product lines beyond handbags. Think ready-to-wear, shoes, accessories, jewelry, and so on.

Of course, this does sound a lot like the orange competition. We’ve often written about Birkin bait and how purchasers of homewares and RTW manage to get bags. Chanel appears to want in on the same game. Its strategy – make bags harder to get and thus available to fewer people. In other words, bolster exclusivity.

As we wrote in “What’s Really Going On With Chanel Prices” (and we would highly urge you to read it again), it very explicitly explains the reasons for the iconic flap to reach exclusive status.
“So, why limit production of iconic flaps now? After all, more bags equal more money, right? That’s especially true as prices approach the five figure mark. While certainly some folks may be priced out of the market, there are plenty of others happy to spend… but if and only if the product is truly special. In other words, exclusivity and unattainability seem to be the name of the Chanel game.”

@flaviastuttgen

Another Price Increase?!

As if this wasn’t enough, we anticipate another Chanel price hike on classic flaps in a matter of just another couple of weeks. Yes, our sources expect it in November (possibly as early as the 1st). We will update you as soon as we have confirmed information.

Since the last steep increase on July 1 we have already seen the categories of the Vanity bags, the Coco Handle, and soon to increase Trendy CC and Deauville along with shoes and other accessories go up.

When talking about the classic flaps we are already approaching Hermes Birkin and Kelly level. The price tags for small, medium, jumbo & maxi styles, respectively are $7100, $7800, $8500 and $9200.

Just how high can they go? Well, we don’t know. What happens if people stop buying? Or if a flap is more costly than a Birkin? If prices continue to go up at the rate we have experienced and at a pace of twice a year — Chanel will completely out price Hermes!

All lessons for another day. But for now, just remember basic economics: more supply should reduce prices unless demand rises higher. Conversely, exclusivity raises value and price. Chanel seems to be doing this by simultaneously lowering supply and increasing prices.

Love, PurseBop
XO