China the new battlefield for luxury brands
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China: the new battlefield for luxury brands. Leo. Contents. 1. Bicester Village’s success. 2. Why do so many Chinese keen to buy luxury goods overseas?. 3. Luxury brands are arriving at the Chinese market. 1. Bicester Village’s success. All for Chinese consumers!.

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China: the new battlefield for luxury brands

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China: the new battlefield for luxury brands

Leo


Contents

1. Bicester Village’s success

2. Why do so many Chinese keen to

buy luxury goods overseas?

3. Luxury brands are arriving at

the Chinese market


1. Bicester Village’s success


All for Chinese consumers!


Celebrating for Chinese new year!


Chinese are shopping in London


2. Why do so many Chinese keen to

buy luxury goods overseas?


Example

  • Price:100 pounds

  • 1 pound = 10 yuan RMB

  • Import tariff rate 15%

  • Value added tax rate 17%

  • Consumption tax rate 30%


Example

  • CIF price: 100 x 10 = 1000 RMB

  • Tariff: RMB 1000 x 15% = 150 RMB

  • Value added tax:

  • (1000 RMB + 150 RMB) x 17% = 196 RMB (rounded)

  • Consumption tax:

  • [(1000 RMB + 150 RMB) ÷ (1-30%)] x 30% = 493 RMB (rounded)


Example

  • After-tax price:

  • 1000 RMB+ 150 RMB+ 196 RMB+ 493 RMB

    =1839 RMB

  • Final price:

    After-tax price + Transport fee + Profit of importer+-------- > 2000 RMB


Example

CIF price

After-tax

Final price

RMB 1000

RMB 1839

RMB 2000


Chinese luxury

consumption groups

wealthy consumers

young

white-collar


The main reason is

the difference of consumption concept


3. Luxury brands are arriving at

the Chinese market


In 2013, An outlet village will be opened in Suzhou


Suzhou

village


Thank you!


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