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Chinese luxury apparel retail sector sees rapid growth

06
Jul '12
Mr. Timothy Coghlan
The luxury retail sector, including the luxury apparel sector, in China is growing very rapidly and several global luxury retailers are opening their outlets and wooing the Chinese consumers as demand for their products continue to decline in Japan and the West.
 
Last month, two international luxury apparel retailers – Hugo Boss and Armani – opened their stores in Beijing.
 
In 2011, consumers in Greater China, which includes Taiwan, Macau and Hong Kong, purchased about US$ 30 billion worth of luxury goods, showing a year-on-year increase of 30 percent.
 
In other words, Chinese shoppers are now purchasing more than one-fifth of the world’s total luxury items.
 
“The luxury retail sector in China is growing at a tremendous speed and many luxury retailers are setting up their stores in China. The luxury retail growth tend is likely to continue for at least the next five years,” Mr. Timothy Coghlan, Manager – Luxury Retail, Savills China, told fibre2fashion.
 
Giving reasons for the international lifestyle brands choosing to open their outlets in China, he says, “China has lot of rich people, who are growing in their class and way of living. They now have more and more access and are learning about the luxury goods through the Internet.”
 
“Besides, the fact that other parts of the world are struggling also makes China a preferred market place. Japan used to be the biggest market, but due to the financial crisis and the March 2011 earthquake its condition has weakened,” he adds. 
 
“Several luxury retail apparel brands such as Alexander McQueen, Armani, etc. are currently eyeing the Chinese market,” he reveals.
 
However, expanding to China brings along a set of challenges. “One of the biggest challenges the luxury brands face is competing for the luxury space. Finding a rare location for the store to operate, and finding a place in malls is becoming more and more challenging in China,” says Mr. Coghlan.
 
“Another problem is finding the right staff and employing people who are well experienced to manage and operate a luxury retail store. Moreover, retailers keen to grab a share of the Chinese market have to aggressively spend on marketing to promote their brands,” he avers.
 

Fibre2fashion News Desk - India


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