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Bernard Arnault is the new richest man in the world overtaking Musk

EconomyBernard Arnault is the new richest man in the world overtaking Musk

Bernard Arnault, a French billionaire is the new richest man in the world, building a massive and profitable luxury retail empire.

How did 73-year-old French billionaire Bernard Arnault overtake Elon Musk and Jeff Bezos?  He did it all with the luxury business better than the rest, transforming Christian Dior, Louis Vuitton, Moet Hennessy, and other mega brands.

Elon Musk did not last long as the world’s richest person and after a little more than a year after getting to the top, he has been eclipsed by Bernard Arnault, according to analysts at Forbes. On December 20, they estimated Arnault’s fortune to be $180.2 billion (€169.8 billion), which is nearly $17 billion more than Musk’s.  Gautam Adani, the owner, and founder of Adani Group from India took the third spot on Bloomberg’s Billionaires Index.

Arnault is co-founder, chairman, and CEO of LVMH Moet Hennessy Louis Vuitton, commonly called LVMH. His holding company is its largest stockholder and has a majority of voting rights in the publicly traded company.

However, interestingly, this is not his first time being called out as the richest person in the world. He briefly attained the position in 2019, 2020, and again in 2021. It is anticipated if Musk can make a fortune out of Twitter quickly, Arnault may not have the title for long.

Bernard Arnault Built a Luxury Empire

LVMH is a Paris-based conglomerate made up of 75 separate brands mostly drinks, high-end fashion, and cosmetics. In 2021, it brought in revenues of €64.2 ($68.2 billion) billion, 20% more than in 2019. Fashion and leather goods accounted for 48% of revenue.

The company — the largest luxury firm in the world — has over 175,000 employees and 5,500 stores. In November 2022, its market value was around €371 billion, according to Statista calculations, making it one of the most valuable companies in the world — ahead of Mastercard, Chevron, and Nestle.

Compared to others on the world’s richest list, Arnault is not well-known outside of France. However, the company’s subsidiaries are luxurious and exotic including many traditional brands like Bulgari, Dior, Fendi, Givenchy, and, of course, the famous Louis Vuitton. They also own retailer Sephora and department stores in Paris. The company’s oldest brand is winemaker Chateau d’Yquem, which was founded in the late 16th century.

In America, Arnault grabbed attention when he bought the famous jeweler Tiffany & Co. in 2019 for nearly $16 billion. In Germany, he made headlines in early 2021 when he bought a controlling interest in Birkenstock, though it is unclear how the sandal maker can be turned into a luxury brand.

Earned Billions out of Louis Vuitton Bags

Arnault was born in northern France close to the Belgian border. After graduating from engineering school, he joined his father’s construction company. There he concentrated on real estate development and soon became its president.

In 1984, he took over a bankrupt business that included Christian Dior and Le Bon Marche department store. It was his incursion into the luxury market. In 1987, LVMH was formed by merging Louis Vuitton and Moet Hennessy. He soon pushed others aside in a hostile takeover and was named chairman of the executive management board in 1989 — a role he has kept ever since.

After becoming the exclusive boss, he went on a decadeslong, multibillion-euro buying spree sweeping up one company after another. Many of the brands had been badly managed and become outdated, so he brought in modern management and hired young designers to transform his company.

Reportedly called “B.A.” within the company, Arnault was described as the “Lord of the Logos” by fashion critic Suzy Menkes in a 1999 International Herald Tribune profile. She also put her finger on the key to his success then and now.

“The aim is to be contemporary, modern, to make the brands speak a universal language,” she wrote. “And Arnault insists that keeping the individuality and uniqueness of each brand is the paramount concern, within a streamlined corporate structure.” This strategy has let each brand keep a degree of independence while becoming more professional.

The company has concentrated on expanding, especially through growth in Asia, its biggest market, followed by the United States and Europe. Its glossy advertising is aspirational. They offer less expensive items like belts, hats, and anything else with a logo to pull in younger buyers and get them hooked.

As everything is moving online, he moved with the times and tapped into the power of the internet. It’s the era where many brands have opulent websites and online shops and are no longer afraid to openly display prices.

Looking at the Future

Always perfectly dressed to the toe, he is a private man, an avid tennis player, and appreciates music and collecting art. For a few years, he owned the Phillips de Pury auction house.

In 2014, the Foundation Louis Vuitton opened in Paris. The Frank Gehry-designed contemporary art museum is home to Arnault’s collection and is considered to be turned over to the city one day. He has also donated millions to charities and for the restoration of Notre Dame cathedral.

Arnault made his billions through the luxury route, in a completely unique way, just by picking up ruins and transforming them into something new.

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