IDEAS home Printed from https://ideas.repec.org/a/spr/qualqt/v59y2025i6d10.1007_s11135-025-02202-x.html
   My bibliography  Save this article

Financial sustainability in the luxury industry across the Covid-19 pandemic: lessons from hierarchical methods

Author

Listed:
  • Fabio Demaria

    (University of Modena and Reggio Emilia)

  • Maddalena Cavicchioli

    (University of Modena and Reggio Emilia)

Abstract

Similar to other sectors, the Covid-19 pandemic has significantly affected the luxury industry, prompting companies to adopt strategies to navigate emerging challenges and address financial difficulties. In light of this, we present a promising approach for investigating the key levers of financial sustainability from a variety of financial indicators. The empirical investigation focuses on the financial performance of major luxury players from 2017 to 2022, starting from the analysis of 20 financial indicators sourced from the literature. Given the multi-layer structure of the data, Hierarchical Multiple Factor Analysis (HMFA) is employed to discern the primary dimensions of financial sustainability over time. Then, mixed-effects model is used to estimate organizations’ stock market performance using the extracted factors, while considering both fixed and random effects. Empirical findings reveal that financial sustainability encompasses four strategic dimensions, with profitability being the main catalyst for enhancing company value and attracting investors’ interests. Finally, this novel approach offers a new and integrated method, including metric and graphical tools, to measure corporate financial sustainability and recognize patterns at every level of the hierarchy.

Suggested Citation

  • Fabio Demaria & Maddalena Cavicchioli, 2025. "Financial sustainability in the luxury industry across the Covid-19 pandemic: lessons from hierarchical methods," Quality & Quantity: International Journal of Methodology, Springer, vol. 59(6), pages 5149-5177, December.
    • Handle: RePEc:spr:qualqt:v:59:y:2025:i:6:d:10.1007_s11135-025-02202-x
    DOI: 10.1007/s11135-025-02202-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11135-025-02202-x
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11135-025-02202-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:qualqt:v:59:y:2025:i:6:d:10.1007_s11135-025-02202-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.