Banjo & Matiltda, Inc. (BANJ) Participates in a Booming Luxu Banjo & Matiltda, Inc. (BANJ) Participates in a Booming Luxury Apparel Market
Located four miles east of the central business district in Sydney is one of Australia’s most famous beaches in the suburb of New South Wales, known as Bondi Beach. The beach is famous for festivals and events such as the Miss Bondi beauty pageant. The word ‘Bondi’ comes from an Aboriginal word meaning ‘noise breaking water over rocks,’ which gives some idea of the iconic imagery of that region. The area has risen so far in popularity that it is now a trendsetter in fashion, and Banjo & Matilda is capturing that beach culture lifestyle trend and bringing it to the world.
Best known as the designer, producer, and marketer of premium contemporary woman’s knitwear, Banjo & Matilda’s line of luxury apparel is now being stocked in a wide range of higher end retailers including Net-a-porter, ShopBop, Intermix, Neiman Marcus, Harvey Nichols, Kadawe in Berlin, Trilogy in UK and many more. The company’s product offerings include sweaters, cardigans, scarves, dresses, skirts, pants, sleepwear, and footwear; plus crew neck, vee neck, turtle neck, and travel garments.
The luxury and premium apparel market continues to be a sweet spot of growth for the $1.02 trillion fashion industry. This has been true for well over a decade and is expected to be true for the foreseeable future. A global strategist at Citigroup, Ajay Kapar, published a memo in 2005 to the private wealth management division titled “Plutonomy: Buying Luxury, Explaining Imbalances”, and the paper has literally become a cult economics classic. Essentially Ajay pointed out that the U.S., United Kingdom and Canada have become key plutonomies. In other words, with plutonomies the rich absorb a disproportionate chunk of the economy and have a massive impact on reported aggregate numbers like savings rates, current account deficits, consumption levels, and so forth. He then put together a hypothetical Plutonomy Stock Basket and noted it outperformed MSCI AC World Index by 6.8% per year since 1985.
For instance, if you owned the Italian luxury jewelry, watch, and fragrance company Bulgari, you nearly doubled your money over the past four and a half years. The Switzerland based luxury goods company, Richemont Brands, likewise did the same. Luxury handbags manufacturer Michael Kors has seen its stock rise 27.1% over the past year. While the poor and lower middle class have become extremely price sensitive, driving sales and stock valuations of companies like Dollar Tree and Family Dollar, the ‘aspiring to be rich’ middle class and the upper class elites have increased their spending on luxury goods consistently. In its July 30, 2014 earnings report, Kerings SA reported second-quarter revenue that exceeded analysts’ estimates as surging demand for Saint Laurent dresses.
As an upper middle class grows in the Asia Pacific region, the luxury product sales are expected to break through $318 billion. The premium area of fashion has always been unique in that it depends very highly and strictly on marketing and promotion to sell to a highly specified group of people. Luxury goods have always been about fulfilling an emotional need for prestige and a heightening of individualism. Banjo & Matilda has been capturing and fulfilling that emotional needs niche and have rapidly gained success with their line of playful 100% cashmere sweaters. Banjo & Matilda’s promotional abilities have been demonstrated as the company developed a strong celebrity following that includes well-known names like Rihanna, Taylor Swift, Miranda Kerr, Elle Macpherson, Nicole Richie, and Dianne Kruger.
The luxury apparel market is expected to globally grow at a consistent rate of 3 to 5% a year with the key drive or growth being the affluent U.S. shopper as well as those in developing markets. As the luxury apparel market is highly fragmented, Banjo & Matilda is a ground floor opportunity poised to capture market share.
For more information, visit www.banjoandmatilda.com
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