That figure far outstrips the approximately $390bn globally that is usually cited as total annual sales of luxury goods such as apparel, cosmetics, watches, and jewelry. Of the $1.8tr in annual luxury spending BCG has identified, sales of luxury cars account for more than $400bn worldwide, and the business of luxury experiences"”from private airline services to five-star restaurants"”is already worth almost $1tr of the total.

In this context, the luxury market continues to buck the slow- and no-growth trends typical of many other industry sectors. BCG forecasts that after the past two years of 11 percent annual growth, the personal-luxury-goods sector will expand annually at around 7 percent over the next few years, outrunning the increases in GDP seen in most economies.

But what those raw statistics don't show is how kinetic the luxury industry really is. We still see launches of lustrous new brands, bold acquisitions, equity stakes purchased by private-equity firms, and even start-up activity. Recently, LVMH Moët Hennessy Louis Vuitton spent $2.6bn to buy cashmere clothier Loro Piana and then acquired Nicholas Kirkwood, J.W. Anderson, and Hotel Saint-Barth Isle de France.

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Keywords: retail supply chain, luxury goods, high-end retail sales, supply chain management, value chain