This week's stock idea: Farfetch | $FTCH | an online luxury marketplace
The leading global online platform for the luxury fashion industry, connecting creators, curators, and consumers.
Core business: income from transactions between sellers and consumers.
The leading global online platform for the luxury fashion industry, connecting creators, curators, and consumers.
Core business: income from transactions between sellers and consumers.
1. About
1.1
$FTCH's main businesses include:
Marketplace: the only global luxury marketplace at scale connecting consumers in over 190 countries from over 1,300 brands.
1.1
$FTCH's main businesses include:
Marketplace: the only global luxury marketplace at scale connecting consumers in over 190 countries from over 1,300 brands.
1.2
Platform Solutions: white-label enterprise which builds and operates e-commerce and technology solutions for luxury brands and retailers.
Platform Solutions: white-label enterprise which builds and operates e-commerce and technology solutions for luxury brands and retailers.
1.3
Store of the Future: the company develops and implements technology solutions to support the retail vision of luxury sellers in order to create new luxury experiences.
Store of the Future: the company develops and implements technology solutions to support the retail vision of luxury sellers in order to create new luxury experiences.
2. Business Segments
2.1
Digital Platform: includes Farfetch $FTCH Marketplace, FPS, BrownsFashion, StadiumGoods, the Farfetch Store of the Future, and any other online sales channel operated by the Group.
2.1
Digital Platform: includes Farfetch $FTCH Marketplace, FPS, BrownsFashion, StadiumGoods, the Farfetch Store of the Future, and any other online sales channel operated by the Group.
2.2
Brand Platform: design, production, brand development and wholesale distribution of brands owned and licensed by New Guards and includes franchised store operations.
Brand Platform: design, production, brand development and wholesale distribution of brands owned and licensed by New Guards and includes franchised store operations.
2.3
In-Store: covers the activities of stores $FTCH operates, including Browns, Stadium Goods and certain brands in the New Guards portfolio.
In-Store: covers the activities of stores $FTCH operates, including Browns, Stadium Goods and certain brands in the New Guards portfolio.
3. Business Highlights
3.1 FY20
3.1 FY20
3.2
Q1 FY21
Q1 FY21
4. Geography Exposure
5. Operating Highlights
6. Growth Strategies
6.1
Strengthening luxury partnerships:
- Adding new luxury sellers and increasing supply from existing ones.
- Partnering with enterprise customers (allow brands and retailers to power their own sites, stores and fulfillment operations).
6.1
Strengthening luxury partnerships:
- Adding new luxury sellers and increasing supply from existing ones.
- Partnering with enterprise customers (allow brands and retailers to power their own sites, stores and fulfillment operations).
6.2
Capturing opportunities in China:
A. Attracting the Chinese luxury consumer (over the next five years, China is expected to become the largest luxury market, and represent more than $100 billion in annual luxury sales by 2025).
Capturing opportunities in China:
A. Attracting the Chinese luxury consumer (over the next five years, China is expected to become the largest luxury market, and represent more than $100 billion in annual luxury sales by 2025).
6.2
B. Establishing partnerships (In Nov 2020, Farfetch announced a partnership with Alibaba ( $baba ) and Richemont ( $CFR ) that includes the launch of the company's luxury shopping channel on Alibaba’s e-commerce platform).
B. Establishing partnerships (In Nov 2020, Farfetch announced a partnership with Alibaba ( $baba ) and Richemont ( $CFR ) that includes the launch of the company's luxury shopping channel on Alibaba’s e-commerce platform).
6.3
Pursuing the platform and Luxury New Retail vision:
Accelerating the digitization of the global luxury industry.
Driving interactions in Farfetch's platform ecosystem.
Pursuing the platform and Luxury New Retail vision:
Accelerating the digitization of the global luxury industry.
Driving interactions in Farfetch's platform ecosystem.
7. Market Outlook
7.1 Personal Luxury Goods Market
7.1 Personal Luxury Goods Market
7.2 General Market
8. Competition
8.1
Technology enablement companies:
- Tech companies that may attract sellers by enabling commerce, such as $SHOP, and $SQ
- White-label service providers, which offer end-to-end solutions.
8.1
Technology enablement companies:
- Tech companies that may attract sellers by enabling commerce, such as $SHOP, and $SQ
- White-label service providers, which offer end-to-end solutions.
8.2 Luxury Sellers:
- Online luxury retailers
- Multichannel players
- Niche multi-brand and streetwear sites
- Luxury department stores
- Luxury brand stores
- Online luxury retailers
- Multichannel players
- Niche multi-brand and streetwear sites
- Luxury department stores
- Luxury brand stores
9. Key Risk Factors
- Purchasers of luxury products may not choose to shop online
- The luxury fashion industry can be volatile and difficult to predict
- Luxury sellers fail to respond quickly to new and changing fashion trends in consumer preferences.
- Purchasers of luxury products may not choose to shop online
- The luxury fashion industry can be volatile and difficult to predict
- Luxury sellers fail to respond quickly to new and changing fashion trends in consumer preferences.
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