According to WWD, Hermès International said Tuesday it expected to post a record operating margin in 2012 - beating its target for annual sales growth after a surge in revenues during last year’s fourth quarter.   The luxury French fashion house, famous for its silk scarves and the Birkin bag’s 4th quarter 2012 sales were up 22.5% from 2011. Hermès attributes much of its success to consumers turning to exquisitely crafted understated luxury goods rather than over-the-top luxury. Hermès chief executive officer Patrick Thomas told WWD: “What we do is perfectly in sync with the aspirations of consumers, first in Europe and the United States, now also in China, since more and more Chinese consumers are looking for discretion and quality objects for pleasurable living, rather than the ostentatious luxury that symbolized the early days of luxury.”  A return to true craftsmanship and simplicity in the fashion market seems to suit Hermès well.

Check out the full article on WWD here.