It is both easy and tempting to believe that the Chinese luxury market is a unique affair focused on Tier-1 cities like Shanghai or Beijing.
Nevertheless, that would be a major mistake, because due to the sheer size of the country and the impressive growth of its economy over the last four decades, in fact the industry has spread out over many more cities and regions. A recent study by Jing Daily, one of the main portals centred on the luxury market in China, highlighted a total of five Tier-2 and even Tier-3 cities that have recently experienced outstanding growth figures, as far as the market penetration of top brands go.
The following cities are the focus of the study, some of which are actually regular ‘stops’ for both our sourcing activities as for the export and distribution business of F&B, a few years ago:
- Ningbo, Zhejiang (East)
- Suzhou, Jiangsu (East)
- Xi’an, Shaanxi (Northwest)
- Shenyang, Liaoning (North)
Wuhan, Hubei (Centre)
Why have purchases of luxury items grown so much in these places in particular?
Experts point out two phenomena: on the one hand in these areas even until recently economic growth has remained solid. On the other hand, for the time being, housing is still fairly affordable there. Hence, the combination of both indicators has allowed for a relative rise of available income in the abovementioned cities.
Source: Jing Daily, the Business of Luxury in China, www.jingdaily.com