Answer the following questions about the provided topic:

1. Is The Luxury Closet unique or does it have a strategy that no other firm has? How could it protect its unique strategy from competitors?

2. What may be some short term and long term financial and strategic objectives for the firm?

3. What special elements of the Gulf regions luxury goods marketplace make The Luxury

Closet a potential success?

4. How could The Luxury Closet evolve its strategy over time?

5. The Luxury Closet does not appear to have a Vision and Mission Statement. Can you suggest

these?

The Luxury Closet and the Luxury Goods industry The luxury goods industry has seen extraordinary growth over the last two decades, With the exception of a Covid-related slowdown in sales in 2020, the industry has seen steady growth in sales. For example, industry leader LVMH saw its sales of fashion and leather goods more than triple over the decade ending mid-2021. Other luxury goods retailers have seen similar growth. The industry is dominated by European firms including LVMH, Kering. Richemont, L'Oreal and Chanel. Each firm has its unique mix of products, including in their portfolios clothing, cosmetics, jewelry, watches and leather goods (most notably handbags). Notable among the top twelve, however, are Chow Tai Fook Jewelry Group (China) and PVH (USA), firms based in two of the largest markets for luxury goods. As is the case in much of the retail sector, technology has changed the way consumers engage with luxury brands. Ptyysical stores, while still important, are being supplemented for many consumers by social media and online buying. Taken together, these factors have driven a significant increase in the volume and value of luxury products being sold globally. The world luxury goods industry is related to, but seporate from, the fashion industry. A key difference from other firms like Inditex (parent of Zara and Pull \& Bear) and H\&M Hennes \& Mauritz AB is that the products that are created are intentionally high quality and thus durable. For example, Hermes' classic Birkin handbag, which sells for upwards of $9,000 USD to buy new, takes a leather artisan around 15 hours to make. It is said once the worker picks up the leather for the bag, no-one else touches it untill the bag is complete. These products are valuable works of art, and like art they hold their value well. Some pre-owned examples have traded at auction for over $300,000 USD. Not all products fare as well. Accessible luxury brands like Michael Kors, Coach and DKNY tend to lose 90% of their original retail value within a few years. It is only the top brands like Hermes, Chanel, Louis Vuitton and Dior that hold their value well, and among these Hermes is the standout brand for investment-quality bags. This contrasts with 'fast fashion' which is generally seen as consumed then disposed of. A byproduct of this product durability, and the significant growth in sales of luaury goods in recent years, is that consumers are accumulating significant quantities of luaxury goods in their homes. Growth in emerging markets for luxury goods has been especially strong over the last two decades, albeit from a low base. Among these emerging markets, the growth in the Arabian Gulf region has been especially strong (Chalhoub Group, 2022). The Luxury Closet The Middle East region, and more specifically the countries that make up the Gulf Cooperation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates) have a strong appetite for luxury goods, Estimates are that the region consumers around USD1900 per person per year of luxury products - the highest in the world. In this context, Kunal Kapoor, founder of The Luxury Closet, saw an opportunity. Kunal Kapoor family owned Rajshree Uptop Footwear manufacturers in Uttar Pradesh, India. He studied in the United States, completing a BA in economics from the University of Wisconsin in Madison in 2002, Dubai. He worked there until 2011 when he estalalished his startug fire The Luarury Closet. He was cuosed in Fortbes (2017) as recalling *Dne day, while having a corverution wich a frend about BMW, if cccurred to me that the same could apply for herufy goods like handeaci." There is an element of winwin in the model, As the fop trandt racely oller discoarth, for price seanat on bupers acquiring pre-owned procucts offer significant apoeal, for potental selech, platormi secth as these offer one of the few way? of seiling their gocts at a reasonacle grice, with limited itcoctukientz or embarrassment. For some wealthy yellets, advertising products os normal sites would be incomensent and may attract unwanted attention from others. Part of the appeal of the businuss thodet is its lifk to mentinatelity. Consumers aee tendied to be mete conscious of waste, and dirgosable, fast-fashion in falling fepm favouf. Pre crinest items ergeciaty thesd that hold their value and last for a look time, are one solution to this issue. style store, where customers could come and boowse, or an online, plation based store he decided tis adopt both. This offered benefits for customets who wanted to come and ste the produrts in persch while also offering the reach and functionality of an online business. The platiom can be acoesced Dne problem that plagues the used lusury industry is the prevalence of counterteit products. The laxary Closet has developed a peocess and expertise to value and authenticate items. For example, all tous Yuaton and Mermes handbags have unique serial numbers embedided within them that can be ctheckad against a manufacturer datahase. Similarfy, high valse taatches lice folex have an increasing number of value addition for buyers, but also for seliers. Both are assured that the trankation that octurn thit an the value of an authertic peoduct. the zale. The Luxury Closet holds the merchandne unted it is acld, makine is available for iagection in Dubai if required. If products do not sell at the advertise price, an algorithm descounts the product an -l it reaches a minimum peice fioor specified by the selier. 512m in addtion bo the 519m raised prewously (Bloomberz. 2022). As sales have been agorouimatel doubling each year since 2012 . This growth in sales wolumes and walues is important as a mariest asth many buyers and mary sellers tends bo provide the optiral condion for the best deel for both partits. it's not all smooth saring for The Luwury Closet. As you would expect, eompetidors are emereme in many markets. Esamples include Lsxepolis in inda and Vestiaire Collective in France. For customers, buy- a from these infernational platforms is simple and relatively inespenase. Nonecheless, the future looks bright flor The Luaury Clesuet. It is leveraped to the aucets of the witter lukary goods industry, offering buyers of new luxury goods an incenthe to sperd a little more in the hopes of some future retutn. Its approash taps into a widening trend towards suatainability and the circular economy, where consweness are moving azay from disposable products toadindurabisty and quality. Discussion Questions protect its unique strates from eompeteons? 2. What may be some short term and lone serm finanoial and strategic objectives for the firm? 3. What special elements of the Gulf regior's luaury goods marketplace mate The taxy Closet a potential success? 4. How could The tunury Cleset evolve its strasery over time? these