The takeover of Farfetch by the South Korean company Coupang has far-reaching consequences.
Kering, the parent company of fashion houses such as Gucci, Yves Saint Laurent, Balenciaga and Bottega Veneta, is said to have terminated its contract with the luxury e-commerce platform, according to various industry magazines. Accordingly, Kering will stop selling its brands on Farfetch in the second quarter of the year
However, according to a document obtained by industry magazine Business of Fashion (BOF), Farfetch plans to work with third-party boutiques to continue to gain access to the brands in the Kering portfolio. The aim is for retailers to continue to upload products from Kering brands to the platform without Farfetch working directly with the luxury goods group.
Farfetch is just a “small player” for Kering
According to Business of Fashion, Kering’s move could mean a massive loss for Farfetch. The luxury goods group’s portfolio has historically contributed more than $100 million in gross merchandise volume to Farfetch annually and earned the e-commerce company a significant commission.
According to the industry magazine Women’s Wear Daily, Kering, in turn, described Farfetch as merely a “small player” in the Kering universe in a conference on Thursday. E-commerce accounted for around twelve percent of the conglomerate’s total sales in 2023, according to Deputy Chief Executive Jean-Marc Duplaix. This is slightly less than before, as the pressure on “aspiration” consumers influenced e-commerce more than physical distribution. While Duplaix did not want to comment further on the collaboration with Farfetch to WWD, he emphasized that Farfetch is not a strategic partner for Kering.
Kering is the second company to have cut ties with Farfetch following its takeover by Coupang. Neiman Marcus Group (NMG) is also said to have terminated its ongoing partnership with the online luxury retailer and halted plans to use Farfetch’s e-commerce software for fashion house Bergdorf Goodman.