Editing LVMH Moët Hennessy - Louis Vuitton, Société Européenne
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=== What's the mission of the company? === | === What's the mission of the company? === | ||
“Our success is only worthwhile if it is also | “Our success is only worthwhile if it is also virtuous” Success can only last if it is fair. And if it benefits everyone, then it will be even greater. What’s the point of inspiring dreams with magnificent products if they don’t meet the highest social and environmental standards? We apply those standards for the benefit of our employees and our customers of course, for our stakeholders as well, but above all for our future.” Bernard Arnault | ||
==== 2023 Objectives to further increase LVMH's global leadership position: ==== | ==== 2023 Objectives to further increase LVMH's global leadership position: ==== | ||
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# Commitment: preserve the environment and corporate responsibilities. | # Commitment: preserve the environment and corporate responsibilities. | ||
# Vigilance: maintain vigilance within current economic and geopolitical context. | # Vigilance: maintain vigilance within current economic and geopolitical context. | ||
# Entrepreneurial spirit | # Entrepreneurial spirit. | ||
==== LIFE 360: LVMH environmental strategy for new luxury: ==== | |||
# Biodiversity: 2030 -> 5 millions hectares of flora and fauna preserved. | |||
# Climate: | |||
## 2026 -> 50% reduction in energy- related greenhouse gas (GHG) emissions. | |||
## 2030 -> 55% reduction and/or avoidance of Scope 3 GHG emissions per unit of added value. | |||
# Create circularity: 2030 -> 100% of new products covered by a sustainable design approach. | |||
# Traceability: 2030 -> 100% of strategic chains covered by a dedicated traceability system. | |||
== Macro Analysis and Trends == | == Macro Analysis and Trends == | ||
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LVMH has undertaken the following initiatives: | LVMH has undertaken the following initiatives: | ||
- | - Life 360 | ||
- 2025 CSR | - 2025 CSR | ||
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|What’s the estimated current size of the total addressable market? | |What’s the estimated current size of the total addressable market? | ||
|$354,800,000,000 | |$354,800,000,000 | ||
|The total addressable market is defined as the luxury goods global market and , it is estimated that the size of the market as of today (6<sup>th</sup> July 2023) in terms of revenue, is US$354.80bn. | |The total addressable market is defined as the luxury goods global market and , it is estimated that the size of the market as of today (6<sup>th</sup> July 2023) in terms of revenue, is US$354.80bn.<ref name=":0" /> | ||
|- | |- | ||
|What growth stage is the company in? | |What growth stage is the company in? | ||
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|80 years | |80 years | ||
|LVMH employees approximately 196,000, making the company a large organisation, research has proven that the average life span of a large company is approximately 50 years. Due to LVMHs exponential revenue growth in the last 36 years, and assuming that the company is in the maturity stage of growth which is approximately 50% of a companies lifecycle, I am going to | |LVMH employees approximately 196,000, making the company a large organisation, research has proven that the average life span of a large company is approximately 50 years.<ref>Stadler, Enduring Success, 3–5.</ref> Due to LVMHs exponential revenue growth in the last 36 years, and assuming that the company is in the maturity stage of growth which is approximately 50% of a companies lifecycle,<ref name=":1">http://escml.umd.edu/Papers/ObsCPMT.pdf</ref> I am going to assume a life span of 80 years. | ||
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|What is the estimated annual growth of the total addressable market over the lifecycle of the company? | |What is the estimated annual growth of the total addressable market over the lifecycle of the company? | ||
|3.38% | |3.38% | ||
|The market is estimated to grow at a 3.38% CAGR (Compound Annual Growth Rate) in the forecast period of 2023- 2028. | |The market is estimated to grow at a 3.38% CAGR (Compound Annual Growth Rate) in the forecast period of 2023- 2028.<ref name=":0" /> | ||
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|What is the estimated company peak market share? | |What is the estimated company peak market share? | ||
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|Which distribution function do you want to use to estimate company revenue? | |Which distribution function do you want to use to estimate company revenue? | ||
|Gaussian | |Gaussian | ||
|Research has suggested that the revenue pattern of companies is similar to the pattern produced by the gaussian distribution. | |Research has suggested that the revenue pattern of companies is similar to the pattern produced by the gaussian distribution.<ref name=":1" /> | ||
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|What is the estimated standard deviation of company revenue? | |||
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