The Business of Fashion’s Post

Out Of Fashion China’s economy grew at its slowest pace in five quarters, and that demure attitude is causing a faux pas in the luxury market. China’s economy was just 4.7% bigger last quarter than the same time last year, short of Bloomberg’s 5.1% prediction. That’s mainly because the country’s real estate market is still in turmoil, with property sales coming in around 14% lower this June than last. So, on edge about the value of their biggest financial asset, homeowners are keeping their wallets shut. That explains why retail sales were only 2% higher this June versus last year, far off the expected 3.4%. And despite new government incentives, car sales dropped by 6.2% in the same period – their biggest fall in over a year. For markets: When Chinese shoppers sneeze, luxury brands catch a cold. As the world’s second-biggest economy, China is usually a reliable market for the finer things in life. But now, shoppers are drawing the line at browsing. Swatch Group, for example, reported on Monday that slow sales in China caused worse-than-expected sales and profit last quarter, pushing investors to send the watchmaker’s stock down 10%. Burberry’s stock fell on Monday too, by 16%. The luxury brand issued a profit warning the same day, citing limp demand in China – a concern shared by LVMH, Hermès, and Prada, all of which have been watching their share prices slip. The bigger picture: It’s out of China’s hands. The upcoming US election could have serious consequences for China. Former president Donald Trump plans to stamp a 60% tax on anything imported from the country – a figure that would hamper its all-important manufacturing industry, potentially encouraging an all-out trade war. And following news of the attempted assassination, the market is pricing in a 70% chance of the former president winning the keys to the White House.

Some luxury labels are discounting their products to an unprecedented degree in China, reflecting a growing panic over unsold inventory as local consumers pull back on spending. #Retail #fashion #Apparel #China #India #DailyNews #ApparelResources #ApparelIndustry #FashionBrand #RetailIndustry

Quite expected last quarter numbers from the market leader #lvmh in the current #economic and #geopolitical enironment, that remains extremely uncertain and volatile… however, I am surprised that whilst the organic sales in US and Europe grew by 2pct, the same went down by 6pct in Asia… Perhaps it can be #attributed to the changing #consumer preferences, shift in the overall #spending patterns, varying levels of #brand awareness/loyalty or increasing #competition from online platforms offering discounts… whatever the reasons, #Asian markets are key for the overall performance of these brands and its prudent to #emphasize more on #segments that performed better than others…#luxuryretail #trends Wines and Spirits 👇 12 pct Fashion and leathegoods ☝️ 2 pct Perfumes and cosmetics ☝️ 7 pct Watches and Jewelry 👇 2pct

“LVMH (LVMH.PA) sales growth slowed in the second quarter as Chinese shoppers reined in spending on high-end fashion at home, even as demand in Western markets slightly picked up.” “Sales at the world's biggest luxury group and owner of labels Louis Vuitton, Tiffany & Co. and Hennessy, grew to 20.98 billion euros ($22.8 billion), a 1% rise on an organic basis, which strips out currency effects and acquisitions.” “That compares to a 3% rise year-on-year in the first quarter, and double-digit growth in 2023 when consumers in key market China splurged on luxury goods as they emerged from pandemic lockdowns.” “The report from sector bellwether LVMH, which is Europe's second-largest listed company, worth around 340 billion euros, follows profit warnings from smaller labels Burberry (BRBY.L) and Hugo Boss (BOSSn.DE) last week.” “LVMH shares have been volatile since the luxury slowdown emerged, and are down about 20% over the past year, amid worries that middle-class shoppers in the world's No. 2 economy are pulling back on purchases due to a property slump and job insecurity.” “Its sales in Asia, excluding the Japanese market, fell by 14% in the second quarter, worsening from a 6% drop in the first quarter.” “Sales in Japan, where tourists are taking advantage of the weak yen, continued to grow.” “"We still see a lot of China travellers, particularly into Japan, which says something about the appetite of mainlanders for our brands, which shows no sign of fading away," Guiony told analysts on a call.” “The surge in sales in Japan is, however, exerting significant pressure on margins, he added, with lower costs and prices compared to China.” “Business with U.S. and European customers is "slightly better", he added.” - Mimosa Spencer

High-end fashion designers saw a 15% stock rebound as China’s stimulus fueled optimism for market recovery. China, a key market for luxury brands like LVMH, Hermes, and Burberry, had been struggling with weak consumer spending, impacting financials. While the government’s aggressive measures sparked a rally, structural challenges and the need for further fiscal support remain. Headwinds in China may continue to affect luxury brands in the coming months. 62% of retail CFD accounts lose money. Your capital is at risk. #Tradu #LuxuryFashion #ChineseMarket

As Imran Amed rightly calls attention with the devaluation of the yen, #Tokyo has become a focal point for #fashion shoppers looking for good deals. But the devaluation of the yen has had 2 specific affects. First there are examples emerging of #fashion brands shifting stock from #PRC to #Japan despite distribution agreements in place - www.distributorlaw.co.uk. Second Chinese consumers are happy to travel to #Japan to make purchases rather than #China. A range of economic consequences for both countries and for Western #fashion brands selling to both markets https://lnkd.in/ghurfaHb.

Bluebell group, an Asia’s leading brand curator, operator and distributor, a partner of choice across Asia for luxury, premium and lifestyle brands, in its 2024 Asia lifestyle consumer profile, among other things, warns that «to maintain brand image, it is necessary to ensure price consistency across different purchasing channels. Asian consumers are digitally savvy and frequently compare prices across platforms. Any inconsistency can deter them and harm a brand’s reputation». This study is focused on lifestyle consumption drivers across Asia, and it is outlining concerns about the devastating impact that pricing misalignments across different channels can have on brand reputation. Price alignment along the digital and physic distribution channel is a significant challenge for any brand due to the huge number of actors, the different currencies, and product variants.   #price

Latin America now the target for Chinese ‘fast fashion’. Increasing Chinese e-commerce volumes threaten Latin America’s “fragile retail economy”, with one analyst claiming the region was having a “stick-or-twist” moment. https://lnkd.in/gCikZ2u8

After posting double-digit revenue growth, Mytheresa CEO Michael Kliger speaks to Drapers about the impact of FARFETCH’s and MATCHES’ fallout and the German luxury retailer's plans to drive future growth. Read the full story below. #fashion #retail #retailnews #mytheresa #luxury

#Miniso: Unleashing Global Joy! 🛍️ Rising Star: Move over #Shein, Miniso is taking the world by storm with 6,000+ stores globally! From Guangzhou to New York, their vibrant pink superstores are everywhere. Joyful Treasures: More than a thousand lifestyle products await, from #TikTok-famed blind boxes to plushies. Step into their #HongKong flagship for a whimsical journey with Barbie, Snoopy, Pokémon, and more! Sales Surge: $519.6 million in revenue for Q3 2023 – a 36.7% YoY increase. Chinese market up 34.7%, overseas markets up 40.8%. Miniso is not just a brand; it's a revenue powerhouse. Future Vision: Founder and CEO Guofu Ye aims for global dominance. Focus on globalization, product excellence, and optimized store network. North America sees a staggering 160% revenue increase. Hong Kong Highlight: Tsim Sha Tsui flagship opens to tap into vibrant consumer power. A strategic move for brand exposure and reinforcing Miniso's happiness philosophy among the youth. What's Next: 2024 promises e-commerce and social media boosts. Get ready for the burst of pink and joy coming to a mall near you! ✨🛒 #MinisoMagic #GlobalExpansion #LifestyleBrand #RetailRevolution #retail #retailers #retailindustry #ecommerce Read the full article here-