85
Fashion Jobs
JO MALONE LONDON
Education Manager, Jml/lm
Permanent · HO CHI MINH CITY
L'OREAL GROUP
Senior HR Operations Executive/ Assistant Manager
Permanent · HO CHI MINH CITY
ADIDAS
Key Account Manager (Franchise)
Permanent · HO CHI MINH CITY
ADIDAS
Senior Manager, Commercial, Adigolf, Vietnam 1
Permanent · HO CHI MINH CITY
ADIDAS
Key Account Manager 1 (Franchise)
Permanent · HO CHI MINH CITY
COLUMBIA
lo Costing & Engineering Manager
Permanent · HO CHI MINH CITY
L'OREAL GROUP
Category Manager - Cpd
Permanent · HO CHI MINH CITY
L'OREAL GROUP
Business Planning Manager - Cpd
Permanent · HO CHI MINH CITY
ADIDAS
Senior Manager Product Creation (Sportwear)
Permanent · HO CHI MINH CITY
L'OREAL GROUP
Product Manager - Shu Uemura
Permanent · HO CHI MINH CITY
ADIDAS
Manager, Quality Product Integrity
Permanent · HO CHI MINH CITY
TAPESTRY
Manager, Manufacturing Engineer
Permanent · HO CHI MINH CITY
SPECIALIZED
Painting Quality Engineer - Bình Dương, Vietnam
Permanent ·
ON RUNNING
Social Compliance Specialist - Hcm Based
Permanent · HO CHI MINH CITY
ADIDAS
Senior Manager, Sourcing Operations
Permanent · HO CHI MINH CITY
WILLIAMS SONOMA
Wood Sustainability Specialist - (Global)
Permanent · THUẬN AN
PUMA
Manager Quality Apparel & Accessories
Permanent · HO CHI MINH CITY
PUMA
Senior Executive, Finance
Permanent · HO CHI MINH CITY
PUMA
Head of Quality Footwear
Permanent · HO CHI MINH CITY
PUMA
Quality Engineer Cobra
Permanent · HO CHI MINH CITY
PUMA
Key Account Manager, Marketplace E-Com
Permanent · HO CHI MINH CITY
ON RUNNING
Head of Footwear Sourcing
Permanent · HO CHI MINH CITY
By
Reuters
Published
Dec 4, 2016
Reading time
3 minutes
Download
Download the article
Print
Text size

Big spenders reappear in China as conspicuous consumption is on-trend again

By
Reuters
Published
Dec 4, 2016

China's wealthiest shoppers are spending at home again, roused from a three-year slumber by a weaker yuan, lower prices and a crackdown on overseas sales agents - a welcome boost for the world's luxury brands.

China's rich make up almost a third of the world's luxury shoppers, up from only 2% around the turn of the millennium. They are a driving force for global luxury, even after a slight dip this year when fewer travelled abroad, in part due to terrorist attacks in Europe.


Price harmonisation and a weaker currency have boosted sales in the Chinese domestic market


For the past three years, a crackdown on corruption and conspicuous consumption by President Xi Jinping dampened sales and big names such as LVMH shuttered stores, particularly in second- and third-tier cities.

In 2016, however, fashion houses, jewellers and buyers say that is changing, as China tries to shift away from an economy driven by heavy investment in infrastructure and encourages consumers to shop.

Burberry, Gucci-owner Kering, and Tiffany have all reported an uptick in their most recent Chinese earnings, striking a note of optimism as the industry enters its critical weeks between the Christmas rush and Chinese New Year.

"Everyone is benefitting from more traffic at the Chinese [luxury] shops," said Bruno Lannes, a Shanghai-based partner with consultancy Bain. It estimates a 4% increase in mainland China sales after three years of decline.

"Some brands in China are expecting 2016 to go back to their peak in 2012, though the mix is different. I expect some brands will beat that record," Lannes said.

On the streets of Shanghai and Beijing, shoppers say they are, indeed, splashing out more often at home.

The depreciating yuan means the currency doesn't buy as much abroad, while luxury brands such as Chanel have moved since last year to narrow the once huge differences between prices in China and overseas.

At the same time, the government has cracked down on 'daigous', shoppers-for-hire who trade off that price imbalance and buy goods more cheaply overseas for mainland Chinese.

"Some brands price their products in China closer to the overseas markets, such as Chanel," said Emma Yu, a 32-year-old housewife exiting a Cartier store while shopping for a handbag in Shanghai's financial district. "If there's only a few thousand yuan difference, I would just buy it at home."

Another shopper outside a Louis Vuitton store in central Shanghai, an accountant at a multinational, said she was also buying more at home, especially if not travelling. "I definitely bought more luxury items at home than in the past since last year - a lot more - because it's convenient to buy things here," she said as she compared a $5,700 bag she had bought with one in the shop window.

Mainland China has been seeing positive sales for a while, Johann Rupert, chairman of Richemont, told investors last month. "It seems that the Chinese government's intent to promote growth through consumption rather than just investment is bearing fruit," he said.

Richemont, the owner of Chloé, Cartier and a dozen other luxury brands, reported "marked" October sales growth in mainland China.

Kering, owner of Gucci and Saint Laurent, reported Asia Pacific sales were up 24% in Q3 and Burberry reported a double-digit increase in Q2, excluding the impact of changes to its offerings in Beijing.

Local brands have benefitted less, analysts say. A spokesman for jeweller Chao Tai Fook said sales in greater China stabilised in September and October compared to declines in the previous two quarters.

The picture is also less rosy in Hong Kong, once the prime destination for Chinese shoppers wanting to avoid hefty mainland taxes without extensive travel. After drops of over 20% annually in the last two years, sales have stabilised, analysts and luxury companies said. But mainland shoppers willing to splash out abroad prefer to go to Japan, Europe or even Macau, said Mariana Kou, an analyst at investment bank CLSA. Tax incentives are no longer enough. "Hong Kong has become a bit boring," Kou said.

© Thomson Reuters 2024 All rights reserved.