Luxury goods have large margins. Buyers are not just paying for the quality but also for the brand. In this project, we will look at two luxury brands: Tiffany & Co. and Canada Goose.

Most of the brands are owned by groups. For example, LVMH has at least six divisions that own 75 brands in total. To withhold business sensitive content, the groups often disclose the financial information in one set of consolidated statements. The segment breakdowns are vague, let alone the performance of an individual brand. It is difficult to disentangle the financial information.

Fortunately, Tiffany and Canada Goose are single-brand companies, making them easier for us to study. Tiffany is specialized in jewelry, whilst Canada Goose sells clothes. Tiffany has much longer history and much larger market cap, whereas Canada Goose is younger and smaller. Despite these differences, you may find interesting similarities between the two.

REQUIREMENTS

Requirement #1

1/ Discuss the background of the two companies.

2/ Browse their website. For each brand, pick one item on sale, tell us what it is (you can insert a picture) and what the retail price is.

3/ Take a guess how much it costs them to make (COGS) and how much net profit the items generate.