Ahead of China’s Labour Day public holiday, Tax Free Shopping provider Global Blue has released its Globe Shopper Report: China Edition, which shows Chinese tax-free shopping spend worldwide fell 24 percent year-on-year in March.
This follows a period of slow growth for the first two months of the year (+11% in January and +5% in February) after an overall increase of +58% in global Chinese Tax Free Shopping spend during 2015. This decline comes against the backdrop of a number of factors including:
- Schengen biometric visa demands – ease of obtaining a visa was an important consideration for 22% of regular Chinese travellers when choosing a holiday destination
- European terrorist attacks – a safe and secure destination was cited by 56% of respondents as an important destination factor
- Tough comparison against global 2015 – March 2015 saw stellar growth of +122% year-on-year, partly due to the Chinese New Year holiday falling later last year
Gordon Clark, MD UK and Ireland at Global Blue, commented: “We are experiencing a decline in Chinese spend this year, with the UK being particularly hit following the introduction of Schengen biometric visa requirements for Chinese travellers in October 2015 and in the associations with the terrorist attacks on Europe. However, this is the first decline we are seeing following years of continual growth and China still drives the highest number of Tax Free Sales in our stores. In a difficult climate, it is imperative to optimise the opportunity and experience for these shoppers to spend, and brands need to take action now ahead of the key May holiday period to market their brands correctly in China and to also make sure the guess experience for a Chinese traveler is the best possible when shopping within their stores.”
While there is low visibility around the performance of the luxury sector in 2016, research findings indicate outbound trips by regular Chinese travellers will be highest in May and October, representing crucial opportunities for international retailers.
May 2016 is expected to be the most popular month for travel to Europe, Japan and South Korea, while October 2016 will be popular for visits to other Asia-Pacific destinations, such as Australia and Singapore. These two key months coincide with major Chinese holidays: Labour Day (May 1-4) and Golden Week (October 1-7).
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