The cost to manufacture a basic, entry-level Hermes Birkin handbag.

The Economist published an interesting article attempting to explain the economics behind the world’s most expensive bag. The cost of a basic bag is described below (bold text):

“Part of the explanation for the bag’s exorbitant price – and the one that Hermès likes to emphasise – is the exquisite workmanship. Each Birkin is the handiwork of a single craftsman, who takes up to 18 hours to complete the job, more if the hide is a delicate crocodile skin. Hermès says its prices are based on its costs, which are necessarily high. Yet the many man-hours and fine materials that go into the making of the bag may not account for much of its price: Luca Solca, an equity analyst at Exane BNP Paribas, estimates that the production cost of a basic Birkin is around $800.”

Birkin fashion economics Hermes
Source: Brooke Unger | "The Economist 1843 Magazine" | 08/31/2016 | Visit