The bag you cannot simply buy
Most companies want to make buying easy. Hermès has built one of the most valuable brands in the world by doing the opposite.
In 1837, Thierry Hermès opened a workshop in Paris making harnesses and saddles for the horses of wealthy families. Nearly two centuries later, Hermès sells the most famous handbag in the world, and it has made that bag famous partly by making it hard to buy.
From horses to handbags
For its first decades, Hermès was a saddler, known for the strength and precision of its stitching. Then the car arrived, and horses began to disappear from city streets. The founder's grandson, Émile-Maurice Hermès, saw the change coming and moved the family's leather skills into luggage and bags. In 1922, the company introduced its first leather handbags, reportedly after his wife complained she could not find one she liked.
It is the same pattern as many great companies: when the original market faded, Hermès kept its craft and changed what it made with it. The saddle stitch, sewn by hand with two needles, is still used on its bags today.
A bag born from a complaint
Hermès already had one icon, the Kelly, which became famous in the 1950s after Grace Kelly was photographed carrying it. The second arrived by chance. In 1984, the company's chief executive, Jean-Louis Dumas, found himself next to the actress Jane Birkin, who complained that she could never find a handbag practical enough for a young mother, big enough for scripts and baby things. She remarked that Hermès did not make pockets. Dumas's reply has become legend: "But I am Hermès." He sketched a roomier bag for her on the spot, and named it after her.
Slow on purpose
Each Birkin is made by a single craftsman, usually in a workshop in France, and takes around 15 to 20 hours of work. Artisans train for years before they are trusted with one. Hermès runs around 60 production sites, mostly in France, with no assembly lines. That alone limits how many bags can exist.
But the scarcity is also a choice. Birkins are not sold online. They are rarely simply on display. In practice, a sales associate usually offers one to a client, often after the client has built a relationship with the store. The official waiting list was abolished years ago, but the feeling of waiting never went away.
Hermès does not sell a bag. It sells being chosen to buy one.
A bag that gains value
Because supply is so tightly controlled, Birkins often sell for more on the resale market than in the shop. One widely cited study found they delivered average annual returns of about 14 per cent between 1984 and 2015, and rare versions have sold for hundreds of thousands at auction. Few things you can carry to lunch behave like an investment.
The family that refused to sell
In 2010, Hermès discovered that LVMH, the giant luxury group behind Louis Vuitton and Dior, had quietly built up a large stake in the company, eventually above 20 per cent. The family saw it as the first step towards a takeover. More than 50 family members responded by pooling their shares into a new holding company, H51, locking over half of Hermès away from any buyer. After a long public fight, LVMH agreed in 2014 to give up its stake.
Independence is central to the strategy. Hermès is still led by the family: Axel Dumas, from the sixth generation, has run it since 2013. Without pressure to hit every quarterly target, it can grow slowly, train artisans for years and say no to easy money.
The strategy: manage demand, don't chase it
Hermès does almost everything the opposite way to a normal business. It does not license its name to other companies. It controls its own design, workshops and stores, around 300 of them in 45 countries. It rarely discounts. It grows production capacity slowly, opening new workshops and training craftspeople over years, and lets desire grow faster than supply.
The result is extraordinary. In 2025, Hermès generated around €16 billion in revenue and about €4.5 billion in net profit, and it has at times been worth more than many of Europe's biggest industrial companies. Owning a Birkin says not only that you could afford it, but that you were allowed to buy it.
What could stop it
The strategy has critics. In 2024, a lawsuit in California accused Hermès of making customers buy other products before they are offered a Birkin, which the company disputes. Exclusivity can tip into resentment if customers feel manipulated rather than special. And scarcity only works while people believe it is earned by craft, not engineered by marketing.
Why it matters
Hermès proves that growth is not the only way to build value. By protecting its craft, its independence and its customers' desire, a 19th-century saddle maker became one of the most valuable brands in the world, without ever trying to sell to everyone.
Would you wait years for a bag?
