- Kristopher Fraser |
Louis Vuitton is slashing internal staff discounts after French tax authorities said that the heavily discounted prices on the merchandise could be considered a taxable benefit. The brand said they will be putting a stop to staff discounts as high as 90 percent for unsold products, with reductions now being capped at 75 percent.
Louis Vuitton's business model involves never selling at discount in stores, but this could change as they now need to find a way to move excess inventory. The internal employee sale with heavy discounts was a way to move merchandise that didn't sell through at retail, because of course employees took full advantage off products known to cost upwards of 2000 dollars at retail value.
The days of brands just destroying unsold retail merchandise are also over. While the practice had actually once been common for luxury brands, amid demands for fashion to become more eco-conscious that just won't fly anymore. LVMH did not immediately respond to comment.
This practice only affects France for right now, meaning that unsold merchandise could move to be sold to staff in other countries who can still enjoy hefty discounts. Needless to say, Louis Vuitton's French employees aren't happy.photo: via louisvuitton.com