The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
The Beijing-based department store group has signed a contract with Wuhan’s government to build a new property in the city’s Wuchang district, set to open in two years, according to an official statement released by the Wuhan city government.
It will be SKP’s first store in central China and follows the luxury department store’s recent expansionary moves beyond its base in the capital, to Xi’an and Chengdu, with other projects also in development in Kunming, Hohhot and Hangzhou.
Retail sales of consumer goods in Wuhan rose 67.4 percent in the first quarter of this year, and GDP grew 58.4 percent, making it one of the top ten performing cities in China by these metrics (though off a low base, as the city was hard hit by lockdowns in the first quarter of 2020).
In 2020, Beijing SKP’s sales reached 17.7 billion yuan ($2.77 billion), making it China’s top luxury department store for the 10th consecutive year. Xi’an SKP, which opened in 2018, posted a 36 percent increase in sales last year.
Mainland shoppers have flocked to local tourism hubs like Macau and Hainan over Chinese New Year and are expected to visit Asian destinations like Thailand and Singapore before returning in droves to European fashion capitals later this year.
Beijing’s Covid-19 policy shift will give the sector a boost in 2023 but a surge in infections and sluggish economic growth could dampen the recovery after an uplift from Chinese New Year.
This week, China rolled back some strict zero-Covid measures, opening a road to recovery for luxury and retail. But the journey is likely to be long and bumpy, experts warn.
Despite disappointing Singles Day sales results, harsh Zero Covid restrictions and supply chain woes, international beauty conglomerates continue to see China as a growth engine.