Ben Gilbert: belief

Transcript context

…Yeah. That €6 billion of that is going to be handcrafted items, where one artisan makes one item at a time, and they're sold around the world. €6 billion worth of that every year growing at 15%-20% a year? Yeah, wild. This is a really important thing to understand about the company. (1) They firmly believe that only 250-300 craftsmen can work in a building. (2) It takes two-plus years for someone to learn the craft and apprentice. (3) Every one of these things must be created by one individual by hand. If you believe all those three things for sure, then it forces a very specific constraint on your business, and you must work backward from that. You can only train so fast. You can only produce so fast, which then of course means that it affects your products, it affects the availability, and it affects the price, which of course means that it affects the customer set. There's a way to view Hermes, which is they want the very highest end customer with zero price sensitivity. They do whatever they need to serve that master. I think there's another very real way to look at it, which is how the company describes themselves that starts with the constraints of the craft. When you hold true to that ethos at its most extreme, you end up with the company's brand and posture that you have today as the only logical end point. They can only hire 300, 400, or 500 craftsmen a year. They can only do this other stuff. Good luck getting a Birkin bag. It's just one of these things where you can say they're artificially constraining supply all you want. As long as they do things this way, this is the max throughput.…

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