Merril Lynch – China to double its consumption of luxury goods by 2015
At this weekend’s 11th edition of Global Fashion Summit held in Milan, Italy, Merril Lynch confirmed the growth rate of the Chinese luxury market has been slowing down, however, in terms of global consumption, China’s share will double from 10% in 2010 to 22% by 2015. According to Merril Lynch, international luxury companies still have room for development of their retail network in China which boasts over 60 cities the size of Milan.
The Italian house of Giorgio Armani operates a record of 100 stores in China, the largest retail network of any international luxury house, followed closely by Salvatore Ferragamo. Nine major international luxury brands have over 50 stores in China: Cartier, Louis Vuitton, Cartier, Hugo Boss and Ermenegildo Zegna.
The fastest growing luxury sector has been watches at 26%, followed by cosmetics and fragrances at 23%, men’s fashion at 10% and women’s fashion at 4%. Currently, over 25% of Chinese make their purchases of luxury goods abroad and the trend is likely to grow in the next 3 years, considering the increased taxation which makes products up to 30% cheaper in Europe – a measure which is already countered by an increase in prices in Europe by some major international luxury companies.