Tourist spend expected to rocket as a result of currency weakness
Chinese shoppers on Bond Street
Premium retailers are gearing up for what they believe could be the biggest ever Chinese Golden Week in the UK, as shoppers take advantage of the weakness of sterling following the Brexit vote.
Favourable exchange rates are expected to spur a spike in sales from Chinese visitors during Golden Week, on 1-7 October this year, which will follow a bumper summer for tourist spend in London.
Tax-free tourist spend in London’s West End jumped 44% year on year in August, tax-free shopping network Global Blue has reported. Chinese visitor spend was up 65% to an average of £1,453 per shopper.
Paul Lorraine, UK general manager of French luxury bag brand Longchamp, said sales from tourists have been steadily rising throughout the summer: “We have experienced great international business for the past 14 weeks and I am confident this will continue through Golden Week. The exchange rate appears to be the biggest driver within this growth.”
Jace Tyrrell, chief executive of the New West End Company, the business improvement district that represents retailers and landlords in the area, said this year’s Golden Week could overshadow Chinese New Year in terms of customer spend.
“February’s Spring Festival holiday, which coincides with Chinese New Year, is traditionally hailed as one of the most prosperous for the district, but this year’s surprise summer uplift has shifted the spotlight to October,” said Tyrrell.
He added: “This year’s Golden Week is set to be a very different story to last year, when spend from Chinese visitors was down 8% on the same period in 2014, following China’s stock market crash.”
Ray Clacher, executive director at Gieves & Hawkes, said the timing of this year’s event, which starts on a Saturday, is also beneficial, as it falls over two weekends rather than just one.
“This will certainly encourage international travel and, with the pound at a new low to the yuan and the ability to reclaim the VAT back at Heathrow, goods [for Chinese tourists] are almost 30% lower than the UK high street price.
“This, together with a new batch of Chinese and Asian students arriving to start the university term, means families may well choose this week to visit their children, which is good news for the university cities,” he added.
Ahlya Fateh, chief executive British luxury label Amanda Wakeley, which has a store on Albemarle Street in Mayfair, said Golden Week gives British brands exposure: “It brings a huge amount of awareness of British brands to Chinese shoppers with luxury goods and high-end fashion attracting the most shoppers. Our location on Albemarle Street offers something quintessentially British to visitors from China, which is great.”