Have you ever looked at a fabulous Roland Mouret midi-dress and wondered “how do I justify the splurge?” Yes? Me too. Or if you’re one of the few that hasn’t already got one, what about that Alexa Mulberry? Both items are pricey and let’s face it, you’ve probably got a million midi dresses and bags tucked away. So how do you justify those price tags?
What if I told you that by investing in designer pieces, you’d be investing in your career? If you want to climb that corporate ladder, you need to dress to impress. Investing in appropriate designer pieces will not only ensure you don’t slip behind in the fashion stakes, but that you don’t coast down the corporate ladder either.
And I’m afraid that tatty, old H&M dress just won’t cut it, darling.
But being the money-savvy lady you are, you’re not going to be inclined to hand over a wad of your hard-earned cash for something, no matter how fabulous it is, if it’s not going to offer a you little something in return too. We all know that good returns can come from investing in stocks and shares, certain art pieces, property and gold, but how about designer clothing and accessories? How fab would it be to invest in designer clobber and see a great return?
I wonder… is splurging on designer fashion a sensible investment, or are we fooling ourselves into thinking so to justify spending high sums?
To Sell Or Not To Sell
Yes, that is the question. You may want to buy some designer pieces for you to wear and keep, but it would be wise to have an idea of a resale value in case you’d like to sell in the future.
Think about this: if you’re lucky enough to get your hands on a Hermes Birkin bag, which could set you back anywhere from £7,500 to £100,000, the resale designer fashion website Vestiaire Collective reveals you could benefit from a resale value of around 137 per cent.
Due to its high demand, a Hermes Birkin bag is deemed the best investment in designer handbags – and with a resale value like that, who could argue?
To put it into perspective: the annual return on a Birkin bag is 14.2% according to the website Baghunter. Compare this to the S&P 500 index return, which has increased by 8.7% a year and it is looking like investing in designer bags (Hermes in particular) is a pretty shrewd decision! And let’s not even start comparing to current ISA rates!
Similarly, the resale value of a Chanel Classic Flap Bag has increased 72 per cent between 2010 and 2015 and Saint Laurent and Céline handbags enjoy remarkably huge increases in resale values, too.
Do we need any more of an excuse to go out and splurge… I mean, invest?!
What Should I Invest In?
But how do we decide which pieces are investments? To help us in our quest, the Vestiaire Collective has devised The Resale Calculator using data from its millions of members to uncover how much luxury designer items will be worth when selling them. It’s a useful tool to indicate the potential resale figure before we actually decide to buy a piece brand new. After all, you wouldn’t put your money into stocks and shares without knowing the potential returns, would you?
There’s no doubt that designer handbags are the best investment of all designer fashion. However, designer shoes (worn and unworn) come a close second and whilst ready-to-wear clothing is never going to compete with the resale value of handbags and shoes, there are some designer clothing pieces that will resell better than others.
A few points to consider if you’re thinking of investing in designer clothing:
Always pick classic pieces as they’re less likely to date. That orange Chanel jumpsuit looks great whilst wearing it in St Tropez darling, but not so great during a work business meeting with the CEO. Versatility is key.
Saint Laurent and Isabel Marant always command strong interest in resale. Pick a classic piece by one of these designers and you’re on to a winner. Balenciaga and Balmain are also two strong contenders for those top spots in resale value.
Treasure Your Investments
If they’re going to serve you well, you need to look after them. Always look after leathers and suedes appropriately, pack bags to ensure they maintain their shape, keep invoices and authenticity cards and store items in their dust bags and boxes.
Having a proof of purchase not only helps to prove authenticity, but also helps with a quick and more profitable sale.
When To Sell
For maximum resale attractiveness, sell pieces within four seasons of release. If people remember the pieces from seasons, they tend to desire them more than if they don’t know about them at all. Therefore, they’ll hold a higher resale value.
Win Some Lose Some
It’s undoubtedly difficult to know the best time to sell a piece. You might already know that a designer’s last collection for a house is always a popular one. Most would advise to sell within four seasons, however, the resale value might just surge if you hold on to it for a lot longer…
So, is investing in designer fashion an excuse to splurge or is it a wise financial move?
You can get excellent returns on your designer investment if you buy the right piece, look after it well and sell it within the right timeframe after buying it. However, as with any investment comes risks, but I’d say that there are far fewer risks involved with buying that Chanel 2.55 than there is investing £4,000 in stocks for certain pharmaceutical or banking companies. Not only that, with a Chanel handbag, you get to experience it and take it to all those girlie liquid lunches (just don’t get too squiffy and leave it anywhere!). What do you get with a straightforward investment? A piece of paper and relatively low return? I know where I’d rather invest my money!
And if you don’t achieve the resale price you’re after, you get to keep that designer piece, but if you do get a fantastic resale price, perhaps buy another piece and do the same with that, too. You could start a profitable side-hustle and become the next Tamara Mellon or Karren Brady… Or you could just have a bit of fun buying and selling and making a little money in the process. What are you waiting for?!
Vestiare Collective: https://www.vestiairecollective.com
Edit Second Hand: https://editsecondhand.com/
Hardly Ever Worn It: https://www.hardlyeverwornit.com/
High Fashion Society: https://highfashionsociety.com/
About the Author
My name is Natalie Blackburn and I’m a busy 36 year-old mum of two under five. I am from, and still live, in the vibrant city of Manchester. Since entering into my thirties and becoming a parent, I developed an interest in good financial planning, and coupled with my passion for writing, I have lovingly created the blog that you read on Sophisticated Savers.
Other interests of mine include reading (autobiographies are a particular favourite) and running (but only if I am pushed to, so I wouldn’t really call it an interest, but just wanted to sound as though I was quite fit!) and yoga (that is a real interest!). Wine and chocolate are also my real interests, and the occasional travel when I have the time.