Is Luxury Fashion the Next Smart Investment?
Luxury fashion isn’t just about style—it’s an asset class.
From Chanel handbags outperforming the S&P 500 to African luxury brands gaining global recognition, investors are increasingly looking to fashion as a store of value. According to Bain & Co., the global personal luxury goods market is projected to surpass $600 billion by 2030, driven by rising demand in emerging markets and a shift towards sustainable luxury.
If you’ve ever appreciated the timeless craftsmanship of a Hermès Birkin, the cultural influence of Telfar, or the innovation of African luxury brands like Tongoro, now is the time to discover how these brands can yield financial returns—not just admiration.
But how do you invest in luxury fashion? And what should you look for in a brand before making a move? Let’s break it down.
What is Luxury Fashion Investing?
Investing in luxury fashion entails allocating capital to high-end fashion brands, designer pieces, and resale markets to achieve financial returns over time. Unlike fast fashion, luxury goods maintain their value and often appreciate.
Investment Options in Luxury Fashion
Designer Resale: Buying & selling rare handbags, watches, and clothing.
Brand Equity & Stocks: Investing in publicly traded fashion houses like LVMH, Kering, or Richemont.
Emerging Luxury Brands: Supporting Black-owned and African luxury brands before they scale globally.
Fashion-Focused Private Equity & VC Funds: Backing early-stage luxury brands through venture capital.
Why It Matters: The rise of digital fashion, sustainability, and conscious consumerism is reshaping how investors approach luxury. By understanding the market, you can invest in brands that align with both your values and portfolio goals.
Why Luxury Fashion is a Smart Investment
1. Luxury Goods Outperform Traditional Assets
The "Hermès Effect": A 2023 study found that Hermès handbags yielded an average annual return of 14%, beating gold and real estate.
Limited Supply = Scarcity Value: High-end brands intentionally limit production, making their pieces more desirable over time.
Resale Boom: The secondhand luxury market is expected to reach $77 billion by 2025, with platforms like The RealReal and Vestiaire Collective seeing record growth.
2. The Rise of African & Diaspora Luxury
African fashion exports are projected to reach $15.5 billion by 2025, according to The Minister of Art, Culture, and Creative Economy Nigeria, Hannatu Musa Musawa.
Luxury houses like Lagos-based Maki Oh and Senegal’s Tongoro are gaining global visibility, attracting high-net-worth investors looking for untapped market opportunities.
3. Cultural & Sustainable Appeal
Conscious consumerism is fueling a shift toward ethical brands with strong craftsmanship.
Investors are favoring sustainable fashion labels like Black-owned eco-luxury brands, which are redefining the industry and are promising profitable fashion investments 2025.
Step-by-Step Guide: How to Invest in Luxury Fashion
Step 1: Define Your Investment Approach
Are you looking for:
✔️ Physical assets (handbags, jewelry, watches)?
✔️ Equity investments (stocks, private shares, venture funds)?
✔️ Emerging markets (African and diaspora-owned luxury brands)?
Understanding your goals will help you choose the right investment strategy.
Step 2: Research High-Performing Brands
Established Houses
Chanel, Hermès, Rolex: Low risk, high resale value, but high entry cost.
Emerging Luxury
Telfar, Tongoro, Thebe Magugu: High growth potential, limited supply, and strong cultural impact.
Sustainable & Ethical Fashion
Brother Vellies and Hanifa: Investors are backing brands that align with conscious consumer trends.
Step 3: Choose an Investment Platform
Public Stocks: LVMH (Louis Vuitton), Kering (Gucci), Richemont (Cartier).
Luxury Resale Platforms: The RealReal, Vestiaire Collective, StockX.
Fashion-Focused Funds: Harlem Capital, New Voices Fund (Black-owned venture firms investing in fashion).
Step 4: Understand Market Cycles
Recession-Proof: Luxury markets dip during downturns but recover faster than other industries.
Emerging Markets: Africa’s middle class is growing, fueling luxury demand.
Exclusivity Matters: Brands that limit production retain higher resale value.
Step 5: Make Your Investment & Hold for Value
Unlike day trading, luxury fashion investing requires patience. Expect items to appreciate over 5-10 years.
Set a timeline for returns.
Track resale markets & emerging trends.
Hold exclusive pieces for long-term appreciation.
Risks & Challenges in Luxury Fashion Investing
Market Fluctuations: Trends change, and not all brands retain value.
Liquidity Issues: Unlike stocks, selling a handbag or artwork isn’t instant.
Counterfeit Risks: The luxury market is plagued with fakes—verify authenticity through trusted platforms.
Storage & Maintenance: Luxury goods require careful handling to retain value.
Luxury Fashion as the Future of Wealth Building
Investing in luxury fashion involves more than just aesthetics; it encompasses cultural influence, financial growth, and the creation of a lasting legacy.
Whether you're purchasing a Chanel bag, investing in a Black-owned fashion house, or supporting an ethical luxury brand, the key is understanding value, scarcity, and market demand.
So, next time you’re at brunch, ask your friends: Are you simply spending on luxury, or investing in it?
About Danetha Doe: Danetha Doe is an economist, investor, and founder of Money & Mimosas. Since 2014, Money & Mimosas has helped visionary founders raise over $180 million in capital. She is also the creator of Money.Sex.Power., an exploration of wealth, desire, and influence—challenging conventional narratives and redefining economic power through a lens of luxury, sensuality, and bold ambition.