February 3 will usher in the Year of the Rabbit, and specifically, 2011 is the year of the “golden rabbit” which is more auspicious. Fittingly, retailers across Asia are bright-eyed with predictions that holiday sales will be brisk. Analysts agree. “Retail sales growth as a whole in China is expected to remain strong at about 20 percent in the run-up to the Chinese New Year,” one analyst told Reuters.
Inflation concerns will not dampen the shopping mood. “Inflation won’t affect wealthy (Chinese) customers. Even for the mass market, people won’t be very picky for pricey goods like this (gold ornament),” said Paul Law, an executive director of Luk Fook Holdings Ltd, the Hong Kong-listed jewelry distributor.
The Year of the Rabbit is driving retailers in Hong Kong, Tokyo and Seoul to plan for sales figures that outdistance last year’s. They bet on especially strong activity showing up in Chinese consumer purchases of cosmetics, electronics and luxury goods.
In Singapore, Helen Khoo, Executive Director at Wing Tai Retail, said that she in fact expects sales in the Chinese New Year 2011 to be as good as that of Christmas and at least 10 to 15 percent over sales in 2010.
In Hong Kong, Alan Chan, who heads a cosmetic chain, noted Chinese tourists typically spend three to four times more than local shoppers. His expectation is sales percentage growth in the low teens at some stores.
In Japan, its Tourism agency says Chinese tourists typically spend almost twice as much as what tourists spend overall (an average $1,150).
The reasons seem simple enough—China’s strong economic growth has generated more spending money for discretionary goods as people’s incomes rise. What’s more, commented Chan, corporate earnings have been strong and generous corporate bonuses are handed out around the time of the Chinese New Year.
But why are Chinese holiday-makers going to other Asian countries and not staying in China?
Those reasons are simple, too, say analysts: Chinese consumers get a better deal for luxury goods abroad. They save on taxes and custom duties. Oh, and one more reason. A Chinese tourist in Hong Kong claimed the payoff in going elsewhere in Asia was that he could be certain he was getting the real thing. “In China, you can not guarantee that you will get the genuine stuff even if you are willing to pay.”
photo credit: hasayang