Luxury brands are expanding faster in Beijing than ever before, due to the growing demand for luxury goods from world famous brands from wealthy local residents, an industry insider said at a forum at the First Beijing Wangfujing International Brand Festival on Monday.
Wang Yao, deputy secretary-general of the China General Chamber of Commerce, said that since 2007 luxury brands have been opening stores in Beijing at an accelerating rate.
Brands such as Burberry, Louis Vuitton, Gucci, Chanel and Prada, which had only opened a total of six new stores in Beijing between 1993 and 2007, were now opening them at a rate of at least one a year, Wang said.
"It is because local residents prefer to buy famous brands," Wang added.
Chinese consumers account for an increasing share of Louis Vuitton's global turnover, both from inside the China market and from Chinese tourists overseas, according to Marc-Antoine Jamet, secretary-general of the brand.
As the capital, Beijing attracts many wealthy people from other cities to consume luxury goods, Wang added. However, Wang said there are still factors limiting the consumption of luxury goods in Beijing.
"Price is the biggest obstacle in Beijing," Wang said. '
The price of luxury goods in Beijing is 20 to 40 percent higher than overseas thanks to the high luxury tax, Wang said.
"I never buy luxury bags in Beijing since I know it can be much cheaper in Hong Kong," said Wen Jing, a 25-year-old woman working in Beijing.
Wen said she lived in Hong Kong for a year in 2008 and found that she could buy luxury bags at a lower price than even the discount price in Beijing. She said some of her friends would rather go to Hong Kong once a year than shop in Beijing.