A couple months ago I talked about how the big fashion houses are looking to open up shop in China. However, this article in the Kansas City Star says that stores in Shanghai, China are looking like ghost towns.
Read this from the article:
“Most leading luxury brands will need to have a flagship store in Shanghai if only to put Shanghai along with London, Paris, Milan on their bags,” said Paul French, founder and China chief of Access Asia, a marketing research firm in Shanghai.
The illusion is so thin that some stores don’t bother to carry much stock. Others may have lots of clothes on the racks, but they carry just one size: medium, which is too big for most Shanghai women....
“Shanghai is a dreadful retail market,” French said.
Of course, there are other cities in China that could be better for this market. Beijing perhaps? I'm not familiar with the cities of China, so if anybody out there could enlighten us on the retail market of both cities, please do leave a comment here.
You may also be interested in reading this report titled, "China Versus the United States: Who has the most to gain (or lose) in apparel?"
It's not a city thing, it's a tax thing.
All luxury goods attract a luxury tax of an average of 24% - those made outside the country (increasingly few admittedly) also attract an import duty. Therefore if you want to see Mainland Chinese buying luxury goods go to duty free Hong Kong.
Posted by: Paul French | July 24, 2006 9:40 PM | Permalink to Comment