Rising disposable incomes to upsurge China Luggage and Leather Goods Market
Posted on 26 September 2016 by KenResearch Consumer Products and Retail,
The publication titled “LUGGAGE AND LEATHER GOODS RETAILING IN CHINA-MARKET SUMMARY & FORECASTS” is a detailed sector report providing a comprehensive analysis of the emerging trends, forecasts and opportunities to 2020. Both qualitative and quantitative insights and analysis of the shifting luggage and leather goods retail dynamics from 2010 to 2020 have been covered.
As urbanization and rising disposable incomes along with a huge population of roughly 1.4 billion, maintains to expand China’s consumer market, the country’s retail market is also evolving. China’s Retail Market is the world’s second largest retail market. In 2013 China overtook the US as the largest e-commerce market in the world and is expected to again overtake the US as the world’s largest overall retail market by 2018 with Chinese spending accounting to bealmost one-quarter of the global retail spending.
The Chinese luggage and leather goods market holds huge growth potential in the forecast period. Most luggage and leather goods retailers have a very strong footprint on tier I and tier II cities in China, but very soon tier III and IV cities will join hands with larger cities to drive the market.China is in fact the biggest producer and exporter of bags in the world. Small and midsize companies constitute the luggage and travel goods industry in China.
The consistent growth in the GDP per capita is a major factor contributing to the growing demand of luxury goods like leather goods in China. The market is positively influenced by increasing household disposable income, a rising affluent middle class, rapid urbanization, a rising demand for luxury in lower tier cities, and a surge in the number of those travelling
Retail in China has enjoyed double digit growth for over a decade as the country enjoys positive economic growth, rising disposable incomes and growing incomes. The global recession slowed growth but as the middle classes expand, retailers have spread to second and third tier cities, and online shopping takes off, spending will increase as more consumers have greater access and inclination to spend.
Mapping the China’s Retail Market Landscape
Global recession has slowed down the growth in China’s retail market. However the rapid evolution of China’s economy into a consumption-driven economy still provides for enormous growth opportunities in the retail sector.A lot many factors can be associated to the rising demand for luxury goods like leather goods, luggage such as consistently increasing population, change in consumer’s tastes and preferences, rising per capita income with persistently expanding middle class and so on.
There has been a consistent increase in China’s demand for luxury good like leather bags, watches, jewellery etc.In 2008, Chinese consumers spent around three billion yuan on luxury goods.
The luggage and leather goods retail sector is expected to generate CNY243.3 billion of sales in 2020, representing a CAGR of 14.43% over the forecast period. Per capita spending on luggage and leather goods will continue to soar, with a CAGR of 13.8% over the next five years.
The growing interest for the online purchase of luggage and leather goods will drive online spending, at a rate of 25.4% over the next five years
Key Macroeconomic Trends Driving Growth in China’s Luggage and Leather Goods Retail Market
Consistently improving macroeconomics conditions have led to the growth of China’s retail market, even though at a slower rate, which has in turn led to increased demand for retail market products in one way or another. Consequently, the growth of the retail market in term of volume has shown positive but declining growth rates and is expected to continue with the same trend over the next five years.
In recent years as competition has grown, so has demand for luggage and leather goods industry. Leather goods and luggage has become one of the fashion statements for women; they prefer designer handbags, laptop bags and travelling bags etc. which has turned their focus towards high end brands such as LVMH and other competing on the same platform. The demand for travel bags also depends upon the growth of travel industry. Bags, wallets and purses dominate the demand, of total luggage and leather goods industry.
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Ankur Gupta, Head Marketing & Communications