A man walks past a boutique of the Louis Vuitton luxury goods company in Beijing, China, November 30, 2016. REUTERS/Thomas Peter
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 percent around the turn of the millennium. They are a driving force for global luxury, even after a slight dip this year when fewer traveled abroad, in part due to militant attacks in Europe.
For the past three years, a crackdown on corruption and ostentation by President Xi Jinping dampened sales: big names such as LVMH, owner of Louis Vuitton, shuttered stores, particularly in second- and third-tier cities.
In 2016, however, fashion houses, jewelers 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 China earnings, striking a note of optimism as the industry enters its critical weeks between the Christmas rush and Chinese New Year.
“Everyone is benefiting from more traffic at the Chinese (luxury) shops,” said Bruno Lannes, a Shanghai-based partner with consultancy Bain. It estimates a four-percent increase in mainland Chin...