LVMH: The Wolf in Cashmere’s Conglomerate

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[00:03:30] - [First question] - How LVMH came to be and Bernard Arnault’s history

[00:08:56] - Spread of revenue and margins across their various brands

[00:13:38] - What it is about their business that has allowed them to achieve such tremendous scale given the scarcity of luxury goods

[00:16:06] - Examples of Arnault reinvesting in the business for the long-term

[00:17:04] - Ways all of their brands and different verticals work together to create value

[00:18:56] - What the general view on success is after Arnault steps down 

[00:21:19] - Key factors that allow luxury houses to enjoy handsome returns on capital historically

[00:23:17] - What he’s noticed about luxury brands and their ability to redeploy capital 

[00:26:25] - How their capital allocation strategy manifests in their financial profile

[00:28:24] - The Arnault family’s control over LVMH

[00:31:48] - The evolution of the industry in Europe and the strong getting stronger 

[00:33:58] - Cultural differences internationally that allow some countries to thrive in luxury brands compared to others like the US

[00:36:17] - Thoughts on the influence of the Chinese consumer on European luxury houses

[00:40:30] - What has characterized their M&A strategy historically

[00:44:08] - Overview of their recent acquisitions and what it means for LVMH going forward

[00:47:46] - Their go-to-market strategy to acquire customers and build the brand

[00:48:11] - Some of LVMH’s vulnerabilities and risks 

[00:50:44] - Key takeaways for investors and operators when studying LVMH’s story