Why Are Luxury Handbags So Expensive? The Reason for High Prices - Bloomberg

The scuttled merger between the owners of Coach and Michael Kors tells us the FTC doesn’t understand “accessible luxury.”

Michael Kors bags on display at a store in New York City.

Much depends on handbags. Although it’s possible to run a business built on beautifully tailored trousers or sumptuous sweaters, the potential market for high-end handbags reaches far beyond designer brands’ traditional wealthy customers and into virtually every tax bracket. In most cases, if you really want to increase a fashion company’s revenue or expand its cultural footprint, you want to be selling handbags.

Some things about the broad appeal of designer bags are easy enough to understand, even for people with no interest in them: They’re powerful status symbols in certain social circles, and, unlike with high-end clothing, you don’t have to worry about sizes or fit, and you can carry your favorite bag as many days in a row as you want. What’s more bewildering to most people is why handbags are expensive in the first place, and why some cost so much more than others.