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It’s not just investment bankers who are burning out at Goldman Sachs.

The Wall Street titan’s hard-charging culture is reportedly driving exhausted staffers out of Marcus, the consumer-focused business it launched to compete with Main Street banks.

Large numbers of engineers, designers and product managers have headed for the door as executives set aggressive deadlines that forced some to work 14-hour days, current and former employees told Insider.

Those hours may pale in comparison to the 100-hour weeks that junior Goldman analysts reported pulling in a viral PowerPoint presentation that exposed the megabank’s intense demands.

But talented tech workers on whom Marcus’ digital services rely can often find better pay and lighter hours elsewhere, Insider reported Wednesday.

One departed engineer estimated that at least a quarter of the engineers who were on the team when Marcus started in 2016 had since left Goldman’s consumer business, according to the outlet.

Another former employee reportedly said as many as eight people have ditched a team responsible for customer-facing tech like apps and webpages.

“This is an avalanche approach,” the ex-engineer told Insider. “When one person leaves, others will follow.”

Goldman spokesperson Andrew Williams called Insider’s departure estimates “overstated,” saying the business “continues to be a magnet for talent.”

Bosses at the bank have pressed Marcus staffers to launch new services at a breakneck pace, forcing them to juggle multiple projects at once, the report says.

That approach started with the Apple Card — the credit card Goldman rolled out with the iPhone maker in 2019 — and spread to other products, such as the Marcus Insights robo-adviser that arrived in February and the checking account it plans to launch this year, according to Insider.

The relentless demands have reportedly helped Marcus rack up $100 billion in deposits and generate $1 billion in annual revenues in just five years — but at a cost.

“It’s what I would call a spark-plug business,” consultant Richard Crone told Insider. “They run them hot so they burn them out.”

Goldman told Insider it has hired close to 100 engineers in the past five months and plans to bring on 200 to 300 more this year. The consumer business has also reportedly scrapped video calls on weekday evenings and all day on Fridays, following in Citigroup’s footsteps.

“We continue to listen to feedback from our teams and are significantly accelerating hiring,” Williams told The Post in an email. “We continue to be proud of this team and our culture, and don’t take these for granted.”

Luxury goods are more expensive than ever, prompting sticker shock on social media. And yet, consumers continue to pay up.

With its hand-woven Italian-leather clutches and impossibly soft double-faced cashmere coats, Bottega Veneta has always positioned itself at the high end of the high-end market. Even in its new incarnation under Daniel Lee, it’s the luxury brand most closely associated with “stealth wealth” or quietly signalling status to those in the know rather than brash flash.

But while Bottega still sells plenty of minimalist-approved products, Lee’s collections have more look-at-me-appeal, generating plenty of social media debate, even after the brand disabled its Instagram account and wiped its Weibo presence.

Most recently, the fashion-conscious corner of Instagram was up in arms over a $3,390 floral-beaded Bottega Veneta necklace with silver hardware. The fire grew when it released a sterling silver, enamel-coated coiled necklace — fashioned to look like a phone cord — for $2,000. With populism on the rise and privilege under attack, followers on the industry watchdog account Diet Prada called the product a “scam.”

“I don’t know what’s more ridiculous, them trying to sell this or the people who buy it,” one Diet Prada commentator said.

A spokesperson for the brand declined to comment.

Chances are, plenty of Bottega Veneta customers won’t blink twice at these prices. At the beginning of the pandemic, as uncertainty set in among shoppers of all income brackets, some industry insiders thought luxury fashion prices — which have been rising since the Great Recession — would come back down to earth.

Raising Prices in a Pandemic

Instead, last spring, blue-chip brands like Louis Vuitton and Chanel moved to raise prices on handbags in particular, with some citing the cost of raw materials and labour. Chanel increased prices twice during the pandemic: once in May, when handbags went up 5 percent to 17 percent globally, and then again in October by another 5 percent.

“Like all major luxury brands, we regularly adjust our prices to take changes in our production costs and raw material prices, as well as exchange rate fluctuations, into account,” a spokesperson said at the time. “In the current environment, the price of certain raw materials, which were already difficult to procure due to the quality we require, has increased again.”

Analysts have other theories. Because sales were down during the pandemic, “brands (that could) rushed to increase prices in an effort to defend their bottom line,” said Bernstein’s Luca Solca. “After all, these are largely fixed cost businesses, so maintaining sales — either through price or volume — is of the essence.”

For some consumers, rising luxury prices were easily absorbed. With travel, restaurants and other experiences on hold, many high earners, jobs intact, found themselves with more disposable income than ever. On top of this, a booming stock market and crypto boom helped to boost their appetite for spending.

This comes after years of rapid new wealth creation in fast-growing economies like China as well as rising economic inequality, both of which have been a boon for the luxury market.

The proof is in the prices. Consider the Celine “Mini Luggage” tote in pebbled calfskin, which cost $1,600 in the US in 2011, just a year after it was introduced by then-new creative director Phoebe Philo. Today, the same bag sells for $3,100 on Celine.com, nearly double the price. When Yves Salomon first released its rabbit-fur-trimmed “Army” parka in 2010, it charged under $1,300. Today, it costs close to $2,100 on Ssense.com.

In the past year, global prices at Prada have increased by 13 percent on average, while Louis Vuitton’s prices are up 10 percent and Balenciaga’s are up 8 percent, according to analysis published by Bernstein, with additional data from Deloitte.

So far, the market has easily absorbed many of these significant increases. But how high can luxury prices go without consumer online backlash translating to real-life boycotts?

$500 T-Shirts, $1,000 Sneakers

It’s not only top-line handbags and garments made with rare materials that are skyrocketing in price. A decade ago, a pair of shoes rarely hit the $1,000 mark. Today, many of high fashion’s most-coveted pairs easily cross that threshold. T-shirts from designer brands often cost more than $500, and if sold-out SKUs are any indication, consumers appear to be comfortable paying those prices.

The rise in costs of “everyday” items can be explained, in part, by the changes in the luxury goods model. “The lower price point products have probably experienced higher inflation over the past few years, and seen the strongest price innovation,” Solca said.

In the past, entry-level products were often licensed businesses — perfumes, eyewear — managed by third parties. Today, however, “the entry customer is more opinionated and informed,” which requires a higher level of creativity on the brand’s end, according to Bain & Co.’s Federica Levato.

“In many companies, there are now departments dedicated to working on entry items — sneakers, T-shirts — and many of these categories are really revamped and rebuilt,” Levato said. “It’s the new way to attract a younger customer, but also a larger audience.”

While older luxury customers may balk at the prices of streetwear, young consumers are used to paying a premium on the second-hand market, making some of them less price sensitive than others in previous generations. They also know they can resell items, often viewing the ultimate cost of the product as the sticker price minus the resale value, boosting perceived affordability.

But Levato said it’s less about the price itself and more about “price relevance,” or the perceived value of an item. Cool items like Supreme T-shirts and Telfar bags don’t have to cost a lot to feel exclusive. Consumers still love a deal, expecting markdowns on products that were discounted in the past. Some brands will be able to continue to raise prices, while those that resonate less may have to pull back.

LVMH-owned Marc Jacobs, for instance, has chosen to further develop its lower-priced product ranges and even launch new ones, a reversal in strategy from 2015 when the company announced it would collapse the wildly popular Marc by Marc Jacobs contemporary line into the main collection. And, while the price of many Celine handbags are far higher than they were a decade ago, the Hedi Slimane-led brand’s overall prices have decreased an average 1 percent in the past year, according to Bernstein.

An October 2020 analysis by the investment management and research firm that took into consideration resale value, organic growth from the past five years and overall consumer interest found that luxury brands including Hermès, Dior and Cartier all had an opportunity to increase their price tags, while Tiffany, Longines and Bulgari should hold steady.

Regardless, those suffering from sticker shock may have to get used to seeing prices similar to those in Bottega’s latest jewellery collection. Ultimately, when consumers buy luxury goods they are paying for high-quality design, materials and construction, but most of all they are paying for social cachet. It’s worth it because the “right” people — whether that’s influencers or their peers — say it’s worth it.

“Who would have thought 10 years ago that people would buy $1,000 sneakers or T-shirts?” Solca said. “The Bottega Veneta beaded choker seems another step in this same direction, moving into a higher price bracket. Value — like beauty — is in the eye of the beholder.”

The new state-of-the-art site will help support the growth of the French group's fashion brands and represents Kering's biggest investment in the country yet.

MILAN — Kering is taking “a quantum leap” to further support the growth of its brands, said Jean-François Palus, managing director of the French group, presenting the group’s new state-of-the-art global logistics hub in Trecate, Italy.

During a virtual press conference on Thursday, Palus underscored “the magnitude of the project” first revealed in 2019 and carried forward despite the restrictions caused by the COVID-19 pandemic.

This single new hub, covering more than 1.7 million square feet, equivalent to 20 rugby fields, “embodies Kering’s omnichannel strategy like never before,” said Palus, explaining that it will enable the company to support the further growth of its brands and it is the group’s response to a scenario that has dramatically changed.

“This growth trajectory and the evolution of the luxury business, notably the rise of e-commerce and the need for faster deliveries, led us to start an in-depth analysis of the adequacy of our worldwide logistics network in Asia, America and Europe, for present and future business requirements,” Palus said. “We went for a complete redesign from the ground up, investing in ad-hoc facilities in Europe, North America and Asia.”

Aiming at enhancing the operational efficiency of its brands in terms of IT, new technology, e-commerce, supply chain management or logistics is key for the group, the executive continued. All the main logistics flows will be concentrated in Trecate, where products will be stored and then distributed globally.

Trecate, near the town of Novara, is less than an hour’s drive from Milan and 13 miles from Malpensa airport.

Construction began in April 2019 and although the first part of the building has been operating since March last year and the second part — over more than 1 million square feet — is scheduled to be operative by the end of the second quarter of 2021, this was the moment, said Palus, “to recognize the efforts of our teams and present you the first achievements as well as give you a clear idea of where we’re heading.”

This complex replaces “a fragmented and saturated” structure of 20 warehouses, offering larger storage capacity, “room for scalability and the ability to fulfill the increasing demands of interconnection with key transportation hubs,” Palus said.

The site will result in a significant reduction in logistics costs, inventory levels and lead times, ensuring true omnichannel services through “faster distribution in all channels, better product availability and optimized inventory,” while improving working conditions of employees.

“An agile, flexible logistics infrastructure in the situation we are currently facing with the pandemic” is essential, he noted, in particular “to redirect the flow of pieces to where they are most needed. In a context of a demand-driven supply chain, logistics is a strategic area, in order to make Kering a leader also in terms of scale and agility.”

The site will generate strong business benefits, meeting the demand from regional warehouses, retail stores, wholesalers and e-commerce worldwide, allowing to reduce lead times by 50 percent, better servicing brands and customers, and lowering cost per piece by 25 percent.

Palus underscored the importance of Italy for Kering, “a country like no other,” home to many of its brands, and a country where the group has channeled several important investments “in artistic and artisanal” competences. To name one as an example, Gucci’s ArtLab leather goods and shoes industrial complex in Tuscany.

Palus declined to provide a figure for the investment in Trecate, but said it was “the largest made in Italy — but this is not only about money, it’s about skills and competences, building a very efficient team, upgrading competence and technologies.”

Sorin Ciocan, group supply chain and logistics director, said shipping capability will increase to up to 80 million pieces and storage capability will be up to 20 million pieces. The hub will be able to ship the products to more than 80 countries and e-commerce orders will be handled in less than three hours.

Transforming its worldwide logistics network in Europe, America and Asia to become fully omnichannel, Kering has also completely redesigned and moved its central warehouse in the U.S. to a new location in Wayne, N.J., in a larger warehouse which is now fully operational. It has created a hub in Dubai for the Middle East and it plans to set up a regional hub to cover Asia in 2021, which “most probably” will be located in Singapore, Ciocan said.

The Trecate site is expected to become one of the largest rooftop solar systems in Europe, with 12.7 MW solar power panels installed on the roof at the completion of the second building, with an estimated saving of 7,500 tons of carbon dioxide a year.

The site will also be the first industrial complex in Italy to produce more energy than it consumes and the energy produced in excess will be transferred to the Italian electricity grid and distributed to Kering stores and corporate offices in Italy.

The buildings will be certified LEED, with a rating expected to achieve Platinum. “Offices are also pursuing the WELL certification to guarantee the best work environment for all employees, with the target of achieving Gold rating,” Ciocan said. “The hub is a truly healthy and pleasant working environment, which is our first commitment, with such features as enhanced ventilation, air quality control, optimal indoor temperature and humidity, ergonomic workstations, individually adjustable lighting, reduced noise, low emissions, areas for relaxation and fitness, and a high-standard healthy canteen.”

The hub was also relevant during the peak of the pandemic as it enabled the distribution of the personal protective equipment needed for all Kering employees in Europe, reaching 700 sites in 23 countries, sending out in less than 12 months 9 million surgical masks, 190.000 bottles of sanitizing gel, as well as millions of sanitizing wipes and gloves.

The complex will count around 1,000 employees at full capacity by the end of 2022. There are currently 250 employees and the goal is to hire 180 by the second half of 2021 for engineering, IT and operations roles.

A number of employees who used to work in Cadempino, near the Swiss city of Lugano, have been repatriated to Trecate. Only a number of specific activities and some warehouses will remain in the Swiss town.

The move pertains to all brands under the Kering umbrella, ranging from Gucci and Balenciaga to Alexander McQueen, Bottega Veneta and Pomellato.

The site is operated by XPO Logistics, Kering’s longstanding logistics partner, which employs the on-site workforce dedicated to warehouse operations.

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