Strategy

Hermès creates and manufactures quality objects designed to last, to be passed on from one generation to the next, and to be repaired. This approach requires these issues to be taken into account at every stage, from design to sales.

Hermès’ strategy is based on creative freedom. Each year, a theme inspires creators and Artistic Directors. Driven by a history spanning nearly 200 years, during which the House has continued to develop with audacity and ingenuity, Hermès paid homage to the theme of Astonishment in 2023. Inspired by creation at Hermès, the ability to astonish is a constant source of innovation and dynamism for the House.

High standards in design and manufacturing encourage the creation of objects that aim to surprise and amaze customers. This creativity, revolving around traditional savoir‑faire, is coupled with innovative processes to revisit timeless models and create exceptional pieces, without departing from Hermès’ trademark humour and imaginative flair. The unbridled creativity flourishes in all métiers, as reflected in the numerous scarf designs printed every year. It is then expressed through over 50,000 references, developed around a unique identity and a style blending exceptional quality, innovation, surprise, elegance and simplicity. In 2023, it was expressed in particular with the successful launches of the perfumes Un Jardin à Cythère and Tutti Twilly and of the 5th chapter of Beauty, Le Regard Hermès, new models in the leather goods collections such as Arçon, Della Cavalleria Elan or by the very strong momentum of Jewellery and Watches, for example with the Hermès H08 watch, which is available in several versions.

Hermès’ mission is to create unique and original objects to elegantly satisfy the needs and desires of its customers.

Its goal is the pursuit of excellence and uncompromising quality, in each of its métiers and services.

Hermès leverages its craftsmanship division, the second pillar of its strategy, with more than 7,300 craftspeople in France. Backed by a history shaped by six generations, Hermès moves with the times, but always respecting tradition, transmission and innovation.

The House works alongside those who master, preserve and transmit craftsmanship savoir‑faire through their knowledge of materials and their exceptional techniques. Each new leather goods workshop is an architectural project in its own right, enabling around 300 jobs to be created and promoting a pleasant working environment on a human scale.

Hermès boosts its investments every year to expand its production capacity and satisfy its 16 métiers.

The House ensures that it continually nurtures improvements in the gestures and savoir‑faire of its craftspeople. True to its commitments in terms of education and transmission, and to support the growth of its activities, Hermès opened the École Hermès des Savoir‑Faire in 2021, which has been rolled out in eight training schools in the regions. After the CAP in Leather Goods, the professional training certificate was extended this year to cutting and stitching. In 2022, the House also launched the École des artisans de la vente in Paris and is rolling out its training courses mainly for sales teams in Hermès stores around the world.

To guarantee this craftsmanship model in the long term, the House’s strategy is to accelerate the securing of its supplies of materials and consolidate relations with its suppliers over time. Vertical integration, through partnerships and acquisitions, ensures traceability in its supply chains and supports the development strategy, with regards to materials as well as techniques and savoir‑faire. More than 55% of production is integrated and 74% is located in France.

Hermès' own distribution model is based on a network of stores, most of which are operated directly, and innovative e‑commerce sales sites, making it possible to respond to rapid changes in demand and maintain a privileged relationship with customers.

The exclusive distribution network consists primarily of branches run by the Group around the Hermès brand. Each of the 294 stores across the world offers a personalised selection of objects, to exceed the specific expectations of customers and offer a distinct purchasing experience in each and every store. Each store is unique and enables its customers to explore and discover the most beautiful products, and extends the House’s lustre worldwide.

The performance of e‑commerce is continuing to grow, alongside the physical network. For the past seven years, Hermès has made the strategic choice of ramping up online sales, with the successful rollout of its proprietary platform worldwide, the attraction and retention of new customers, and the development of services. This strategy supports the House’s customers and accelerates the digitisation of uses. This digital flagship is designed like any Hermès store with its spirit of fantasy, authenticity and diversity. The windows, products, services and stories are gathered in a single virtual place.

Customers are placed at the core of the omnichannel network, so as to best meet their expectations and offer them a unique experience. Around the world, Hermès stores are veritable “homes for Hermès objects”, each with its unique architecture, offering customers a unique experience, complementary to its website hermes.com. The House also hosts special occasions, revolving around events in the world, and dynamic and animated set designs. Its unique and responsible communication ensures that it stands out, while nurturing the link with its customers, by giving prominence to multi‑local expression.

Maison Hermès, present in 45 countries, has an omnichannel network that is geographically balanced, with measured development and a constant search for prime locations.

The entrepreneurial spirit has been at the heart of Maison Hermès since its creation. It is illustrated by its abundant creativity, a capacity for constant innovation, new métiers, new production units and store openings.

This strategy offers store managers freedom of purchase, to meet the specific needs of their customers. Two podiums are organised every year to present the fall‑winter and spring‑summer collections. These bring together all store and country managers, managers of the different métiers, as well as designers, to present all collections to the sales teams, who are thus responsible for compiling their own collections and making their store unique, with a special mix of products.

This freedom means that in each country the Group’s customers are presented with a diversified and unique mix of products resulting from this flurry of creativity, blending emblematic products and the House’s new references, chosen to best meet local expectations.

In order to continue this strategy, Hermès asserts its independence, underpinned by a strong family‑based shareholding structure, committed to retaining most of its production in France and preserving its culture.

This independence, and the House’s strict financial management, allow it to self‑finance operational investments, both in production capacities and the network, as well as cross‑functional projects, and to preserve its long‑term strategy.

As a company that respects the nature that inspires it, Hermès ensures the preservation of its resources and its impact on natural environments and local ecosystems, with an artisanal production model. The Group is stepping up its efforts in terms of social, societal and environmental performance.

Hermès’ highly integrated craftsmanship model promotes the creation of skilled jobs in France and social inclusion. The Group has more than doubled its workforce in 10 years and more than 60% of recruitment takes place in France. The diversity of talents is a source of wealth, creativity and innovation. In 2023, Hermès accelerated its job creation by recruiting 2,400 people, including 1,400 in France. More than 22,000 employees promote Hermès worldwide. These women and men who guarantee the quality of the objects, constitute a heritage for the House. To affirm its commitment to education, the House is developing its training schools for its major craftsmanship métiers.

The profit‑sharing and incentive agreements, as well as the granting of free shares, enable all employees in France to share in the Group’s success. A new free share allocation plan to all employees was announced in June 2023. Today, employee shareholding, taking into account these latest allocations, concerns approximately 80% of employees. True to its commitment as a responsible employer, and recognising the commitment of everyone to the Group’s performance and success, Hermès paid all Group employees an exceptional bonus in 2024, in addition to the salary increases in France and worldwide. In 2023, the House also continued its actions to strengthen inclusion and diversity. Today, 6.85% of Hermès employees in France have a disability, exceeding legal obligations. A third Group Disability Agreement was signed at the end of 2023.

Nature, a source of exceptional materials, is at the heart of our craftsmanship model and its preservation plays a central role in Hermès' commitments. Global warming, its impact on biodiversity and the industrialisation of raw materials are areas of concern, which the House addresses through its climate strategy, its concrete initiatives in terms of responsible supply chains and its policies for the preservation of natural resources.

The Group’s environmental policy is based on major commitments to preserve natural resources: protection and regeneration of biodiversity, reduction of water abstraction, control and reduction of discharges and waste. The House is increasing its practical actions to minimise its footprint on biodiversity, in particular through a comprehensive inventory of its impacts according to the Global Biodiversity Score (GBS) method in partnership with WWF and CDC Biodiversité and the undertaking of ad hoc studies in certain sectors. In 2023, the Group committed to the Science Based Targets for Nature (SBTN) approach, in order to establish scientific objectives for nature, in particular for biodiversity, freshwater, forests, soils and oceans. Hermès is one of the 120 companies that have initiated this approach worldwide.

The House, which by its nature is a low emitter of greenhouse gases, however continues to implement its commitments against climate change, in line with its objectives for a climate trajectory below 1.5°C, validated by the Science Based Targets initiative (SBTi). The Group is stepping up its actions by controlling its industrial, logistics and commercial activities and by the gradual commitment of its partners within the value chain. In particular, on the subject of energy, the Group’s energy sobriety policy is supplemented by an energy de‑fossilisation strategy, in particular through the use of renewable energies.

Hermès places responsibility and sustainability in all its actions and creations. The systematic implementation of its particularly demanding responsible real estate standard will make it possible not only to reduce the greenhouse gas emissions of new constructions but also the energy consumption of buildings to integrate sustainability issues across the entire life cycle of real estate projects. The Hermès “responsible IT” approach, led by Hermès Système d’Information (HSI), covers all of the Group’s digital products and services and aims to use best market practices to respond to the repositioning of digital to assist the environmental transition of operations (IT for Green), to limit the digital carbon footprint (Green IT) and support the Finance function in the consolidation of regulatory reporting. Each métier or production unit is committed to applying the principles of eco‑design to use materials wisely, as well as to reduce waste and promote reuse and recycling to move towards a circular economy. The widespread use of product LCAs (life cycle analyses) structures this approach.

Through its engagement with local authorities and communities where its production sites are located, Hermès contributes to revitalising regions, and provides working conditions that offer proximity and stable employment. Thanks to the Fondation d’entreprise Hermès, the Company is expanding its philanthropic actions through artistic creation, education and transmission, solidarity and the preservation of biodiversity. The Group is an economic player that is committed to its ecosystem and its stakeholders. Hermès is committed to support its suppliers in meeting requirements in terms of traceability, certification, carbon trajectory, reduction in water consumption and the use of plastics. Its supply chain briefs are published on the House’s website, as well as its animal welfare policy. The House has increased the transparency of its non‑financial information, in particular through the publication of its Climate Transition Plan and its Forest policy.

In 2023, Hermès again saw an improvement in non‑financial ratings, reflecting the strength of its CSR commitments. Hermès was thus rewarded when it received the Grand Prix Emploi Humpact, which recognises achievements in social matters, for the third time, as well as the Grand Prix CAC Large 60 of the Transparency Awards, which recognises the quality of regulated information. Hermès is on the CDP A‑list (ranking of the 330 best performing companies worldwide on environmental issues), rated A for Climate and Water, and A- for Forest. The ISS agency published an improved rating of “B- Prime” (versus C+ in 2021). The Group consolidated its position in the ratings of Moody's ESG and FTSE4Good.