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City Report Wuxi

Wuxi is a prefecture-level city and a historical and cultural city in southern Jiangsu Province, 128km from Shanghai. It is one of the cradles of national and rural industry, and one of the top ten economic cities in China. The high-end textile & garment processing industry is key, and Wuxi is also an important base for textile manufacturing and export, that includes textile spinning, printing, clothing, chemical fiber and textile machinery. Because it is in a subtropical monsoon climatic region, the city has a moderate climate, with an annual average temperature approximately 24 degrees centigrade.



The GDP of Wuxi in 2013 was 807 Billion RMB, an increase of 9.3% compared to 2012. Industrial added value increased to 305.73 Billion RMB, or 7.0% for the same period. The Total retail sales of consumer goods were 274.09 Billion RMB, up by 12.9%, and per capita disposable income of urban residents increased 9.4% to 38,999 RMB. the Mechanical Industry, Bio-pharmaceutical, Metal Manufacturing and Electronic Information Technology are the five major industries of the city. Among them, textile garment processing occupied the prominent position, the number of enterprises in the sector with annual sales over 10 Million RMB was 1,340 in 2010.


Luxury retail distribution

Zhongshan Road district is and always been the real centre of all the Wuxi business areas. Many large shopping malls selling both international and domestic well-known brands of clothing, accessories, shoes and cosmetics can be found in this area and have even established recognition in surrounding cities. Big shopping places located in the area including the Grand Orient Department Store, the YaoHan Department Store, Center 66 plaza, Parkson and the New World Department Store.

City Report-Wuxi

The Grand Orient Department Store

After repositioning in 2008, the Grand Orient Department Store changed its focus from middle-end to high-end and targeted the wealthy consumers in Wuxi. The store is made up of 2 buildings and covers a business area of nearly 80,000 sqm. The A building is a boutique store with plenty of international brands including Dior, Burberry, Max Mara, Cartier, Longines, Gucci, Bvlgari, Bally, Armani, and Versace.

The Yaohan Department Store

The store opened in 1996, and was sold to a domestic retailing company in 2005. Aimed at the high-end market, the store has attracted numerous international brands. The first floor includes nearly 50 luxury brands, such as: LV, Catier, Salvatore Ferragamo, Moncler, Hugo Boss, Bally, Coach, Dunhill, TOD’S, Ermenegildo Zegna, Burberry, Gucci, Versace, and Givenchy.

Center 66 plaza

Opened in September 2013, Hang Lung Plaza is the new kid on the block in Wux. The mall covers an area of 118,060 sqm and 270 exclusive stores. Current luxury tenants are Valentino, Versace, Dolce & Gabbana and Coach.


Consumer attitude

Wuxi ranks sixth for the richest people in the Yangtze River Delta in 2012, and as a result has a huge potential market for luxury goods. Now that the market is developing rapidly, local consumers prefer to buy luxury goods at home instead of going to Shanghai or abroad. After the initial arrival of some luxury brands, local consumers have gradually migrated and selected those brands that are suitable for them. They are also willing to pay for luxury products immediately rather than travelling far for small discounts.

‘High-price luxury attracts some local consumers’ psychological needs. Wuxi’s luxury consumption value is far higher than those cities around it, for example, it is estimated that its consumption value is higher than the sum of that in Suzhou and Changzhou’ according to a sales director in the Yaohan department store.

‘I would like to spend one third of my salary on luxury things. I’m aware of all the luxury brands and prices, and Wuxi and Shanghai are the two place that I shop most’ according to Miss Xu, a experienced luxury consumer who works for a foreign company.

‘I don’t understand luxury brands and don’t care, but as a SME owner, Luxury goods can highlight my status and taste. It will contribute to my business especially when I am with my clients. So I prefer to spend some money on luxury brands; besides that, the money is just chickenfeed to me’ Mr. Zhou, a local private business owner.

Editor’s view

Wuxi is ranked the second highest city for GDP in Jiangsu province in 2013 and Per Capita GDP broke through USD$ 20,000 for the first time. Because of its special location, the city is affected by the ‘fashion city’ Shanghai in terms of luxury consumption. Although luxury in second-tier cities such as Wuxi has developed rapidly, the local consumers are still at the stage of ‘seeking big Logos’, and lack brand loyalty.

The positive thing is that consumers in Wuxi have adapted to luxury knowledge and culture quickly. The concept of luxury can be found everywhere in their daily life. They are willing to try new luxury experiences, such as luxury hotel catering, luxury tourism and high-end medical and health services. Some clever domestic businessmen already see the opportunity and have invested themselves.

Undoubtedly the Wuxi luxury market will stabilise and develop gradually. Although Hermes withdrew from this market in 2013 because of a change of brand strategy, the enthusiasm of the consumer remains. Luxury brands will meet the current psychological needs to show off or practical needs for gifting to build relationships. A huge number of private business owners and the growing young fashion set are the main contributors to the market.



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