Sacre bleu! Louis Vuitton forced to ration luxe goods
PARIS – A victim of its own success, Louis Vuitton, the French maker of luxury leather goods has been forced to ration the number of items it sells in select European boutiques to its sometimes obsessive clientele. For Clary Wong, this meant she wasn't allowed to buy a matching wallet for her bag.

-- Anonymous, June 03, 2001

Answers

ANYONE DOUBT IT WAS THE EMBEDDED CHIPS AND THE FAULTY DATES IN THE ORDER PROCESSING SYSTEM??

PARIS – Clary Wong emerged from the Louis Vuitton megastore on the Champs-Elysees with a $520 leather backpack and a big look of disappointment on her face.

"We came here to spend money, and they wouldn't even let us," said the 23-year-old shopper from Hong Kong.

Ms. Wong is one of thousands of shoppers facing an unusual and somewhat bizarre reality at Louis Vuitton these days.

A victim of its own success, the French maker of luxury leather goods has been forced to ration the number of items it sells in select European boutiques to its sometimes obsessive clientele. For Ms. Wong, this meant she wasn't allowed to buy a matching wallet for her bag.

But for Helen Kimmel of Linwood, N.J., who rushed to Louis Vuitton after checking into her hotel, the margin for disappointment was higher.

"I have nine bags to buy for friends," said Ms. Kimmel, who joined scores of afternoon shoppers in a one-hour line outside the Paris flagship store.

Louis Vuitton has become a magnet for image-conscious shoppers since the brand's recent revival.

Louis Vuitton says it is trying to ease the shortage, and it has built four new factories that will boost this year's production by 20 percent.

In the meantime, said Olivier Labesse, a Paris-based spokesman, "we are obligated to limit the sales of each client a little."

He said there are no set quotas, but salespeople in heavy tourist regions like Paris and Milan have been instructed to exercise discretion in selling. It often depends on a specific store's stock.

"We prefer to have five clients leaving with one Vuitton bag than only one client leaving with five Vuitton bags," Mr. Labesse said.

The rationing is also an attempt to control a thriving black market that has emerged in response to pricing differences within Louis Vuitton's network of outlets around the world. In Japan, where the brand is wildly popular, items can cost up to 50 percent more than in Europe.

Right on the sidewalk outside the Champs-Elysees shop is evidence of this black market: Deals are cut involving runners, commissions and shifty- eyed handoffs.

Tony Lu from Hong Kong stands outside the shop looking every bit the customer, nicely dressed and toting a Louis Vuitton shopping bag. But he's actually a middleman.

On a recent sunny afternoon, Mr. Lu described a network in which he casually approaches passers-by and offers a commission for an illicit shopping spree. Once the deal is done, Mr. Lu delivers the goods to a point man stationed at a nearby cafe.

One curious bystander was offered a $65 commission to buy $1,300 worth of Louis Vuitton merchandise, cash in advance.

Where do these ill-gotten gains end up? Mr. Lu pointed to Asia, which accounts for more than half of Louis Vuitton's worldwide sales. The company rang up $2.1 billion worldwide in 2000.

"It's more expensive in Asia. That's why I'm here," Mr. Lu said.

Company officials call it the "parallel market" and say it is an isolated phenomenon limited mainly to large stores like the Champs-Elysees boutique, which gets about 3,000 visitors a day. That's why rationing is stricter there.

Store security guards are wise to people like Tony Lu and frequently shoo him away, Mr. Lu said. Meanwhile, Louis Vuitton tries to keep track of customers and their purchases. Customers are required to register their passport numbers with each sale.

Some shrewd shoppers have devised ways to beat the system, such as asking strangers strolling the boulevard to buy on their behalf.

Noriko Shinohara, a 26-year-old boutique owner from Tokyo, has a more labor-intensive strategy. Starting at the Champs-Elysees, she planned to hit as many Louis Vuitton branches as possible, since word was out that the company's central computer takes several hours to register passport numbers.

"Today is my Louis Vuitton day," said Ms. Shinohara, who listed her other must-see Paris sights: Chanel and Hermes.

-- Anonymous, June 03, 2001