World of Fashion
Deloitte: Private Equity and Investors Survey 2025 — Fashion and Luxury Remain Attractive
By Yvonne Heinen-Foudeh, Senior International Correspondent
Once a year, Deloitte publishes a report providing a global overview of the fashion and luxury goods market and analyzing investment trends and M&A activities. The current study included 60 private equity investors and over 114 companies from the clothing and accessories, watches and jewelry, cosmetics and perfumery, luxury cars, luxury hotels, private jets, cruises, furniture, yachts, and luxury restaurants sectors. The 26 companies in the fashion and accessories sector that were part of the panel generated total sales of US$206 billion in 2024. Europe accounted for 87 percent of sales.
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When asked about the regions with the highest investment potential in the fashion and luxury sector, 75 percent of investors still name Europe. On a global perspective: already in 2023 and 2024, hotels, clothing, and accessories remained the most important drivers of global M&A transactions of various kind in the fashion and luxury goods sector.
The luxury market is weakening. This is also underlined by the recently published “Fashion & Luxury Private Equity and Investors Survey 2025”. At the same time, this market remains very attractive to investors, a finding in the survey, which was conducted by Deloitte, one of the leading consulting and auditing firms. Ninety percent of the investors surveyed want to remain active in the fashion and luxury sector, even though eight out of ten of them believe that tariffs will have a negative impact on the market. The NEEDLE's EYE presents the report.
Compared to the previous year, the fashion and luxury market declined in 2024 in terms of both sales (down 2.0 percent) and EBITDA margin. In 2024, the average EBITDA margin in the luxury sector was 16.7 percent (down 2.1 percentage points compared to 2023). According to the report, the EBITDA margin for clothing and accessories in the personal luxury goods sector was higher, at 29.4 percent. This figure masks a decline of 2.6 percentage points. Sales in this sector were down 1.4 percent.
Number of transactions down
At the same time, M&A activity in the fashion and luxury sector has slowed: in 2024, 333 transactions were recorded worldwide (down 25 compared to 2023). The first half of 2025 confirms the negative trend: there were 162 transactions during this period, while in the first half of 2024 the number was 188, which is 16 percent higher. The figures for clothing and accessories are also declining: there were 85 M&A deals in 2024, compared to 105 in the same period last year. In the first half of 2025, there were 44 mergers and acquisitions, 9 fewer than in the first half of 2024. In the personal luxury goods sector, only the cosmetics and perfumery segment recorded an increase in transactions, from 21 to 34 within a year, or from 18 in the first half of 2024 to 20 in the same period in 2025. Watches and jewelry, which had recently been in slight decline, also increased to 7 in the first half of 2025 (up 4).In both 2023 and 2024, hotels, clothing, and accessories remained the most important drivers of global M&A transactions in the fashion and luxury goods sector. In terms of the average value of mergers and acquisitions carried out in 2024, luxury cars led the way with a value of $958 million. In second and third place were clothing and accessories, with an average value of US$476 million – an increase of 26.1 percent compared to the previous year – and watches and jewelry, with US$313 million and a whopping 167 percent increase. Overall, there is a growing focus on medium-sized companies (annual sales of $50 million to $250 million).
Europe – the region with the highest potentialFrom a geographical perspective, the Asia-Pacific (APAC) and North America regions recorded the sharpest declines, with 29 and 23 fewer transactions, respectively, compared to 2023, while Europe experienced the strongest growth with an increase of 14 transactions. In the first half of 2025, the trend was reversed: Europe recorded the sharpest decline with 30 fewer transactions than in the same period in 2024. North America followed with a decline of 11 M&A deals. The other figures: Asia-Pacific up 1, Middle East up 4, Japan up 4, rest of the world up 6.
When asked about the regions with the highest investment potential in the fashion and luxury sector, 75 percent of investors still name Europe. North America follows far behind with 23 percent. However, just under 80 percent of respondents expect increasing geopolitical instability to have a negative impact on the fashion and luxury sector. Thirty-three percent fear that Europe, in particular, could struggle with tariffs and trade barriers. Only North America is seen as posing an even greater risk (35 percent). Asia ranks third (29 percent). According to the investor panel, the categories most affected by tariffs could be fashion retail (20 percent) and the fashion industry (15 percent). Nevertheless, after cosmetics and perfumery (25 percent), the fashion industry (24 percent) and fashion retail (14 percent) remain among the most attractive areas for investment.
Transformation casts shadows ahead.
The luxury market is also facing major changes and challenges in terms of customer preferences, emerging markets, regulations, and the restructuring of supply chains, Deloitte concludes in its “Fashion & Luxury Private Equity and Investors Survey 2025.” An increasing focus on nearshoring to ensure more flexible supply chains in times of geopolitical uncertainty and the growing importance of AI are just two of the five major trends identified by the
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Deloitte provides audit, consulting, financial advisory, risk, tax, and legal services with approximately 470,000 employees globally, and operates in over 150 countries. In FY 2024, the network earned revenues of US$67.2 billion in aggregate. Based in London, U.K., the consultancy firm’s network is composed of member firms of Deloitte Touche Tohmatsu Limited, a private company limited by guarantee incorporated in England and Wales
“Medium-sized companies represent a strategic sweet spot for investors, combining established operations with significant growth potential, emphasizes Elio Milantoni, Senior Partner M&A with Deloitte Advisory: ”Unlike large, mature brands, they often offer opportunities for consolidation, operational optimization, and market expansion”. Consequently, for financial investors, these companies indeed present attractive valuations and clear avenues to create value, whether through scaling, supply chain enhancements, international expansion, or aggregation within a diversified brand portfolio. © Deloittemage caption