Is the U.S. Ready for the Chinese Shopper? Hong Kong Offers Glimpse of What’s To Come?

Posted 03/25/2012 by in

From http://www.bonbrand.com

This week marks the official beginning of China’s National Holiday, one of the biggest travel periods for the Chinese and a time when Hong Kong in particular becomes a major target for mainland tourists. Dubbed by HK retailers as “Golden Week” (guess why), it has grown into an all-out phenomenon of manic Chinese consumerism as thousands flock to the city and literally shop until they drop.

 

 

 

 

 

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A line of Chinese tourists wait up to an hour or more to make a purchase at any one of the stores that line Tsim Sha Tsui’s Canton Road including Louis Vuitton, Gucci, and Hermes.

Why Hong Kong? Mainland China’s regulated economy includes taxing foreign goods as high as 50 percent (but generally 30-40 percent), which means luxury stores in on the Mainland become just a place to kick the tires before consumers make the trek to Hong Kong for the big purchase. But recent studies have shown that Mainland Chinese are increasingly become more confident in traveling abroad, and with soon-to-be relaxed visa restrictions, the numbers of tourists visiting — and shopping — the United States will likely triple in number by 2013.

A recent study from the CLSA, a brokerage and investment group, suggests that the PRC will account for 44-percent of global luxury sales by 2020 and reach that level through an annual growth rate of 23-percent. Certainly nothing to sneeze at, which is why Hong Kong retailers have unabashedly begun to tailor their operations to servicing the mainland customer.