As the impact of the economic crisis does not yet appear to have hit the world's richest, luxury goods continue to sell well. Although there are few in Estonia with vast amounts of wealth, luxury products also remain in high demand in the country.
In a recent interview with Bloomberg, the chief executive of world-famous champagne producer Moët Hennessy, said champagne was selling so well, that the company is running out of stocks. The same also seems to be happening for many other expensive luxury goods.
According to economist Kristo Krumm, this is partly due to the affects of the pandemic subsiding, but also because there are more and more extremely wealthy people in the world.
In Estonia, there are very few people with such vast amounts of wealth. It is not possible, for instance to find the most exclusive fashion houses selling their most expensive clothes here, nor can you buy the world's most expensive champagne in Estonian restaurants or bars.
That is not to say that there are not some in Estonia who remain unaffected by the economic crisis. However, they prefer to spend their money on luxury real estate, boats and cars.
Severin Vilentšik, sales manager at Bentley's Tallinn office said, when it comes to luxury cars, demand is on the rise. "We have never had so many orders," said Vilentšik. "People are interested and willing to wait longer than average. Waiting times are a bit longer at the moment due to the high demand."
The average Lamborghini or Bentley can cost €300,000 and Vilentšik expects to sell 80 cars this year. As orders for the luxury vehicles are placed by customers well in advance, sales levels should continue at the same rates until 2024 at least.
However, it is not only luxury goods for the rich, which are selling well.
According to Erkii Laugus, CEO of the Tallinn Department Store (Tallinna Kaubamaja), the growing number of social events following the removal of pandemic-related restrictions is also having a positive impact on sales more generally.
"The only thing holding back sales of winter clothing this fall, has been the warm weather," Laugus told ERR.
"After all, for two years, there has been no reason to buy special clothes because there have been very few events. However, this year, the number of events has increased. The number of birthday (parties), anniversaries and weddings has clearly grown and so, the amount of clothes needed to attend them has also increased," Laugus explained.
In the same way, items such as cosmetics and perfumes, which people did not use as much while staying at home during the pandemic, are now also selling in greater volumes.
However, Lenno Uusküla, chief economist at Luminor and economist at the University of Tartu, said that luxury goods may not be entirely immune to the effects of the pandemic.
"Looking at things in the longer term, the Chinese economy is definitely not doing well, so we cannot talk about completely cyclical behavior when it comes to luxury goods. How a country is doing and how many rich people are in that country at any given time, is still very important," Uusküla explained.
Editor: Michael Cole