Oxford Street is anticipating a shopping spree from Asia today as Chinese tourists celebrate the lunar new year by snapping up luxury brands.
Although the Chinese new year is traditionally a time for families to gather at home, a burgeoning middle class has the money and inclination to travel. Increasingly, the wealthy are using the holiday to get away, and Chinese tourist numbers are set to double by 2014. In London Chinese tourists make a beeline for the high-end shops.
Wang Yanming, a Beijing publisher, is typical of the affluent visitors arriving in the UK. â€śI have always wanted to go to the UK. It is a beautiful country with a long history,â€ť said the 32-year-old. â€śI did a lot of shopping, because it was so much cheaper. In outlets and factory shops, the prices for brands like Burberry, Mulberry, Vivienne Westwood and Ben Sherman were incredibly low. For some of them the price was not even half of that in China.â€ť
In all, she spent about 20,000 yuan (ÂŁ2,816) on bags, clothing, shoes, souvenirs and chocolates â€“ and another 15,000 yuan on designer handbags that three colleagues asked her to buy for them.
The pound has lost about a third of its value against the renminbi in the past three years, adding to Britainâ€™s attractiveness as a holiday destination.
â€śStores such as Burberry and Selfridges now have Chinese speaking staff assistants to cater to the huge number of Chinese customers,â€ť said Jonathan De Mello, a retail analyst at the CB Richard Ellis consultancy. â€śChinese workers take their holidays at the same time. They come here on tour groups, everything is done for them. They are taken to shops in the West End where they feel obliged to buy something. Itâ€™s very lucrative for both sides. They are the new Japanese.â€ť
De Mello said shoppers from mainland China and Hong Kong account for about 30% of the luxury goods market in Britain, followed by Russians, Arabs and Japanese, with British shoppers making up only about 15% of the purchases.
One reason why luxury goods in the UK are popular with Chinese shoppers is price. Prices of luxury goods can be up to 30% higher in China because of import high tariffs and taxes.
Well-known brands and local products such as Burberry, Clarks shoes and Scottish whisky are favoured particularly as they are less likely to be fake here. According to figures from the New West End Company, which represents retailers in Bond Street, Oxford Street and Regent Street, the Chinese were the highest-spending nationality last year, parting with ÂŁ3m on fashion, cosmetics and confectionery.
Britain is expecting a growing influx of Chinese tourists in the next few years. VisitBritain says trips to the UK are forecast to more than double by 2014, growing by 117% relative to 2008, with almost 130,000 additional visits (representing a 0.8% market share for the UK). This would make the UK the 14th most visited destination from China in 2014.
It is easy to overstate the importance of tourists from China: in 2009 only 89,000 mainland visitors arrived in the UK, compared with 2.9 million US tourists. But Chinese numbers are climbing, while US arrivals are in decline. And the Chinese spent an average of ÂŁ1,310, while their US counterparts spent ÂŁ753. Luxury brands have done particularly well. Harrods recently reported that half of the crowds at the first day of its Christmas sale were Chinese.
Travel companies say the UK should be well-placed to benefit further from Chinaâ€™s growing prosperity. â€śTop attractions include its unique scenery and culture, shopping, football, visiting children who are studying in the UK â€“ and Harry Potter,â€ť said a spokesperson for Titicaca, a Chinese travel company specialising in trips to the UK.
Yet some Chinese are deterred from coming to Britain because a separate visa is required. Architect Yu Xiaoliang, 37 from Hangzhou is preparing to visit Amsterdam for work and will take the opportunity to visit other European countries. â€śI didnâ€™t think about going to the UK because you need to apply for a separate visa, which is both expensive and troublesome,â€ť he said.