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Luxury market to grow robustly in future
01 Oct '07
2 min read
Sales of luxury goods are estimated at between EURO100 and EURO150 billion annually with luxury fashion representing an estimated 5%. The Japanese, Europeans and Americans are the main luxury good consumers and are also among the top consumers of Australian wool.
An increase in disposable household income and household wealth through rising property prices has supported the growth in luxury good sales. Other contibuting factors have been greater access to consumer credit; an increase in the number of singles, people marrying later and having fewer children, and divorcees; greater discretionary income due to savings generated by some shopping at mass retailers and discounters; a rise in share prices over recent years; and growth in international tourism.
In the USA, luxury retailers Nordstrom and Saks Inc had strong same-store growth in the second quarter of 2007. In comparison, discounters Walmart and Target had lower same-store sales with sluggish growth in apparel.
Target sales have also been buoyed by the sale of some designer labels such as Stella McCartney and Josh Goot. Many European luxury stores, Hermes and Dior among them, have also had strong growth in 2007. However, European luxury stores' sales have been negatively affected by the strong Euro and US$ relative to the Yen.
Analysts expect the luxury market to grow robustly in the next 5 to 10 years, driven mainly by an increasing number of wealthy individuals and rising income levels in emerging economies such as China, India and Russia.
An increase in disposable household income and household wealth through rising property prices has supported the growth in luxury good sales. Other contibuting factors have been greater access to consumer credit; an increase in the number of singles, people marrying later and having fewer children, and divorcees; greater discretionary income due to savings generated by some shopping at mass retailers and discounters; a rise in share prices over recent years; and growth in international tourism.
In the USA, luxury retailers Nordstrom and Saks Inc had strong same-store growth in the second quarter of 2007. In comparison, discounters Walmart and Target had lower same-store sales with sluggish growth in apparel.
Target sales have also been buoyed by the sale of some designer labels such as Stella McCartney and Josh Goot. Many European luxury stores, Hermes and Dior among them, have also had strong growth in 2007. However, European luxury stores' sales have been negatively affected by the strong Euro and US$ relative to the Yen.
Analysts expect the luxury market to grow robustly in the next 5 to 10 years, driven mainly by an increasing number of wealthy individuals and rising income levels in emerging economies such as China, India and Russia.
Australian Wool Innovation Limited
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