Why Hermès Birkin bags are so expensive, according to a handbag expert

Following is a transcript of the video.

Narrator: Hermès Birkin bags are some of the most expensive bags in the world, ranging anywhere from $9,000 to half a million dollars. The bags embody absolute luxury.

– A Birkin bag?

– You’ve heard of it?

– Of course. That’s a very nice purse.

Narrator: The exclusive accessory’s even considered by some to be a better investment than gold or the stock market. And the world’s most expensive bag is an Hermès Himalaya Birkin bag that sold for $500,000. So what is it that makes Birkin bags so expensive? The story of the bag begins with its namesake: Jane Birkin. On a flight from Paris to London, the English actress happened to be seated next to the chief executive of Hermès, Jean-Louis Dumas.

Pilot: Flight attendants, please prepare for takeoff.

Narrator: Jane was known for carrying a wicker basket wherever she went and used it for everything from groceries to diapers. When she tried to fit her famous basket in the overhead compartment, the lid came off, spilling the contents everywhere. Jane complained to her seatmate that it was impossible to find a weekend bag she liked. Dumas introduced himself as the head of Hermès, and the pair spent the flight sketching possible handbag designs on the back of an airplane sick bag. A year later, Dumas presented Jane with the Birkin bag, a spacious yet sophisticated leather design perfect for everyday use. The Birkin’s pockets made it highly functional, and the bag seals to prevent anything from spilling. Hermès makes the bags in France using premium materials like calf skin, alligator skin, and even ostrich skin. Each bag is made entirely by hand.

Although Birkins are one of the most exclusive and sought-after bags today, they actually weren’t all that popular when they first launched. It wasn’t until the ’90s that the Birkin became one of the it-bags of the era. Now they’re the ultimate status symbol. Victoria Beckham reportedly has a collection of over 100 Birkins, estimated to be worth over $2 million, and Singaporean socialite and entrepreneur Jamie Chua is considered to have the world’s largest Birkin collection with over 200 bags.

But you can’t just walk into Hermès and get one. While there used to be a wait list, nowadays all you can do is hope to be important enough or spend enough to be offered a Birkin bag. And if you’re offered one, don’t expect to be able to choose the color or size.

Hermès also places limits on how many Birkin bags a client can purchase per year. This dedication to preserving the exclusivity of the bag has certainly paid off, and the disparity in demand and access has created a thriving resale market.

A 2017 study revealed that the value of Hermès Birkin bags has increased 500% in the last 35 years, an increase of 14% per year. One of the most coveted models comes from Hermès’ Himalaya collection, which comes in three sizes. Often referred to as the holy grail of handbags, the white Himalaya Birkin bag features 18-karat white gold hardware and more than 200 diamonds. The 35-centimeter model in particular is very rare and has sold at record prices year after year. Most recently in 2019, it sold for over half a million dollars. Professional sports betting consultant David Oancea, also known as Vegas Dave, made the record-breaking purchase.

David Oancea: The reason I bought the Birkin bag is I love breaking records. I broke all the sports betting records, I wanted to break the most-expensive-bag record. I’m all about raising the bar. Also, it’s about supply and demand. The only other one in the world is by Steve Harvey’s wife, so there’s only two in the world. Not even Kim Kardashian has this, so I actually bought it for content, believe it or not, so I could take videos with it, pictures of it, getting people to talk about me.

Narrator: The record-breaking sale actually took place over social media.

Oancea: Sale was pretty easy. I posted on social media, I have about a million followers, that I’m looking for a bag. This lady hit me up, Privé Porter. She messaged me, said she’d get me the bag. I realized it was the most expensive bag. She said it would break the record. And this is for sure the record, $500,000?

– Absolutely, most expensive bag ever sold.

Oancea: We closed this deal in about three to four days, really, really fast. I actually do use the bag. Most people think I’m crazy. They put it away like in a safe, and they never touch it again. I’ve taken it out twice, once to a night club in Vegas as a great piece of content. It’s definitely worth the cost ’cause you could offer me a million dollars cash, and I wouldn’t sell it. My asking price is $2 million. If not, I’ll just keep the d— thing.

Narrator: It’s also made with white or albino crocodile skin, which is extremely rare. The costly skin is painstakingly dyed to emulate the snowy appearance of the Himalayan mountains.

Mason Howell: The high retail value and resale value is because these are pieces of artwork. These artisans train years and years to make one of these bags, and they may even train 10 years before even they’re allowed to make a Birkin.

Narrator: Another reason for the bag’s high price of course is the limited availability. The total number of Birkin bags Hermès produces each year is a well-guarded secret, but it’s estimated that there may be around 200,000 in circulation. And for the luxury resale market, Birkin bags are a hot commodity. Online retailer Privé Porter uses Instagram and WhatsApp to sell the bags online, and luxury reseller The RealReal has hundreds of Birkins available at any given time, many of which are priced well above the original retail cost.

Howell: The Birkin bag does retain and sometimes exceeds its value. It really does depend on the leather, the color, the size of the bag, you know, the hardware. There are so many factors that go into pricing a Birkin that it could really vary. However, if you do buy a Birkin, let’s say in 2004, and maybe the retail at that time was $5,000, you most likely will be able to sell it, even if you have worn it so many times, for $5,000, $6,000.

Narrator: Even as resellers like The RealReal and Privé Porter have made more Birkins available than ever, the prices haven’t gone down.

Howell: If you go to Hermès, you may not always get the exact color, size, that you want. Here, we have almost every single option, and if that means you have to pay a small premium, people and our clients are willing to do so. Even though that there has been such a saturation of these bags, not one bag is the same. So let’s say an Etain Birkin 35 with gold hardware, we only have one right now, and if it’s sold, we may not get another for a while, so someone’s looking for that, and they’d be willing to pay an extra maybe $10,000 to get that bag as soon as possible, and all these bags are handmade, artisan craftsmanship. It’s a piece of artwork. Not one is the same, not even one stitch.

Narrator: So if you have an extra $10,000 lying around, it could be worthwhile to invest it in a Birkin. Just make sure that you’re not falling for a fake. From Canal Street in New York City to websites like eBay, the counterfeit market is full of luxury knockoffs, and Birkins are no exception. Back in 2012, Hermès sued several websites for selling fake products and won $100 million in damages.

That same year, French police cracked down on an international crime ring that was manufacturing counterfeit Birkin bags. The crime ring reportedly included actual Hermès employees. Only two employees were arrested, but Hermès believed that several other employees could have been involved. And despite all their efforts, fake products continue to flood the market. The quality of counterfeit bags has also vastly improved over the years, making it difficult to tell whether a bag is real or fake. However, there are a few tricks to spotting a fake Birkin.

Howell: The handle should never be too long. If they look too long, longer than the bag, then it is most likely inauthentic. The hardware shouldn’t be too shiny or protrude out, and the feet, another big thing, it’s one of the best things I always check, is that the feet should never screw off. They are hammered in. The leather itself should feel very supple, very luxurious.

Narrator: And if the price seems too good to be true, it probably is. While many other handbag styles have come and gone, it looks like the Birkin is here to stay. And the bag has become synonymous with status in a way that many other luxury goods have yet to.

Despite its popularity, the bag features no prominent logos and is only recognizable to people who already know what it is. In Birkin, Hermès has created something that feels inaccessible unless highly exclusive. As for whether the Birkin will always be so expensive, only time will tell.

EDITOR’S NOTE: This video was originally published in June 2019.

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I help Hermès collectors buy and sell used Birkin bags. They’re almost impossible to get in stores, but I’ve sold nearly $2 million worth through eBay and online.

Hermes So Black 28cm Box Calf Feather Kelly Rigid.JPG
“It’s a handbag, a piece of art, and an investment all rolled into one,” says Caroline Bui, aka The Birkin Fairy.

  • Caroline Bui is the founder and owner of ‘The Birkin Fairy,’ a luxury consignment shop for Hermès products.
  • After working at Hermès for 12 years, she launched the online shop and has since sold nearly $2 million of used Hermès items. 
  • This is her story, as told to freelance writer Jenny Powers.
  • Visit the Business section of Insider for more stories.

It was 1984 when Hermès debuted The Birkin Bag, a handcrafted leather carryall featuring two sturdy top handles and a lock and key closure to ensure all of the bag’s contents remained inside the bag. At the time, the bag, named for British actress and singer Jane Birkin, retailed for approximately $2,000 to $3,000. 

The Birkin Bag would one day become the most sought after bag in the world, a status symbol creating legions of fans and spurring a years-long waiting list of eager buyers from around the globe willing to pay five to six figures for a single bag.

I’ve been interested in fashion since I was a child.

I spent many summers accompanying my grandmother to local garage sales. Born in 1920 and having survived the Great Depression, my grandmother was understandably frugal and recognized the value in good quality objects. 

Caroline Bui  Hermes
Bui holding Hermès bags.

We would sift through items in search of jewelry and pottery that she would later resell for a higher price at her own garage sale. She was an incredible salesperson, and while I didn’t realize it at the time, these experiences taught me the joy and exhilaration of the hunt which would later define my interest in collectible objects that retain or gain value. 

When I turned 17, I spent the summer living in New York City studying fashion illustration and draping at Parsons School of Design. Upon graduating high school, I went on to The Art Institute of Chicago where I earned a BFA while working in sales at Chicago’s newly opened Ralph Lauren store.

Diploma in hand, I returned to New York in 1999 taking on a series of fashion editorial-related jobs at Conde Nast rotating between Mademoiselle, Self, and Allure before moving on back to retail. 

I fell in love with the social component of fashion while working in retail.

While I became accustomed to being surrounded by luxury products, what really fueled my interest in fashion was engaging with customers and helping them find what they wanted. In 2001, I decided I wanted to return home to Chicago and so I requested a job transfer to the location where I’d initially worked.

The following year, I took a sales position at Hermès.

Back then there were only eight of us in the Chicago store, and we were each assigned an area of specialty. Mine was leather goods and scarves – not because I possessed any special knowledge in those areas, but simply because that was the section that needed to be filled at the time. 

As part of my training, I was invited to travel to Paris where I had the opportunity to meet with the craftsman, tour the distribution facilities, and pay a visit to the Hermès Museum, a venue exclusively reserved for staff and select guests. My new work aligned perfectly with my art history background and for me, every transaction was like selling a piece of art. 

Over the years, I assisted thousands of customers and sold countless Birkin Bags.

In fact, one of my longtime customers who was a collector referred to me as “The Birkin Fairy” or “Fairy” for short because my position allowed me to grant Hermès wishes.  

Everyone knows that getting your hands on a Birkin Bag of your own is no easy task. Demand surpasses supply. It takes 48 hours to handcraft a single bag and production is limited. 

Caroline Bui Hermes
A pile of boxed Hermès products in Bui’s home.

It’s almost impossible to be able to walk into a store and buy a Birkin off the shelf. You can put in a request for one, but no one knows how long you’ll be waiting. They’ve even placed a limit on how many Birkins a client may purchase each year. All of these factors have caused a thriving resale market.

Even after working at Hermès for 10 years, I had to get special permission from the powers that be to buy one for myself as a gift when my daughter was born in 2011. A few years later, I managed to acquire a second, less expensive one for $3,000 as part of an employee sale of handbags that do not pass the company’s quality standards and are therefore only offered to employees.

By 2013, I was a married mother of two and wanted to spend more time at home with my family.

In search of more flexibility, I began interviewing at other companies, but when a longstanding client asked if I could help her sell 20 pieces of her Hermès collection, I decided to go out on my own in a different direction.

In 2014, I set up shop from a tiny desk in my bedroom. I invested $2,000 to buy a domain name, build a website, and secure a few basic supplies before officially launching The Birkin Fairy, a secondary luxury marketplace selling pre-owned Hermès products.

The first bag I sold was an orange Birkin that at the time was nine years old. My client originally paid $6,600 for it in 2005, and it sold for $8,700 in 2014.

Hermes Orange 35cm Birkin in Epsom Leather with Gold Hardware. Caroline Bui
This orange bag is the first Birkin Bui sold as The Birkin Fairy.

To date, I’ve sold nearly $2 million of Hermes products online through my website and Ebay.  I sell all items on consignment, brokering transactions on behalf of my clients for a commission ranging anywhere from 18 to 30%. 

All my business is via word of mouth – I’ve never spent a dollar on customer acquisition.

I’m truly a one-woman operation from photographing products to acquiring and selling merchandise to shipping to social media, where I have over 81,000 organic Instagram followers.

Before COVID-19, I traveled across the country to meet with sellers, helping them do everything from evaluate their inventory and determine what they’d like to sell to help them authenticate, organize, and care for their items. One of my clients in Los Angeles wound up having $505,000 worth of Hermès handbags sitting in her closet and after reevaluating the contents, we ended up selling $50,000 worth of handbags and acquiring six new pieces for $98,000. 

My site has featured everything from a well-worn Birkin that sold for $8,000 to the $150,000 So Black feather Kelly Bag that I have up for sale right now, which is only one of two bags ever made.

While I have worked with some celebrities, most of my clients are just regular folks with amazing closets.

The resale market for Birkin Bags has always been robust.

This is because there is so much more inventory online and it’s readily available – for a price. The pandemic has driven more interested buyers online and helped grow my business due to inventory shortages, production delays, and store closures. 

One study from 2017 revealed that over 35 years, the value of Birkin bags rose 500%, with an annual increase of 14%. When you buy a Ferrari and drive it off the lot, it immediately loses value. When you take a Birkin Bag home, depending on how rare it is and how it’s maintained, it has the potential to increase in value. It’s a handbag, a piece of art, and an investment all rolled into one.

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