12 March 2013
2013 Chinese New Year sales: Hangzhou
|Chinese New Year decorations sell like hot cakes. (Photo courtesy of Xinhua News Agency)|
How shopping malls have fared
Hangzhou is one of the leading cities in consumption among China’s large and medium-sized cities. However, the Chinese New Year sales statistics of this year show that the turnover of seven major shopping malls in the city during the Spring Festival period has dropped by 2.6% year-on-year. From the statistics of the Hangzhou Municipal Trade Bureau, it is understood that these seven shopping malls including Hangzhou Tower, Hangzhou Department Store (Baida), Intime Department Store and Jiebai Department Store have recorded year-on-year increases of 21.6% and 66% respectively during the fourth and fifth days of the lunar new year. Nevertheless, it could not reverse the overall declining trend of the consumer market during the Spring Festival period (from Chinese New Year’s eve to the fifth day of the lunar new year) when the aggregate sales of these seven shopping malls amounted to Rmb282 million with a year-on-year drop of 2.6%.
Although many shopping malls launched sales promotions during the Spring Festival period to stimulate consumption, the total sales volume fell behind that of last year. According to the related person-in-charge of Hangzhou Tower, "the overall performance has shown a sign of decline as compared with that of the last Spring Festival. But with the supporting promotion of Valentine’s Day, the sales growth of jewellery gained more than 10 percentage points." With Valentine's Day falling on the Spring Festival holidays this year, the festive atmosphere was further enhanced. Yet an independent festival for sales promotion was lost from the perspective of shopping malls. A shopping mall executive frankly remarked, "If not for Valentine's Day, the sales performance would have been even worse." "During the past Spring Festival periods, the sales of jewellery used to surge right on the first day of the lunar new year. Yet for this year, the sales peak deferred to the fourth and fifth days. In particular, the turnover of Valentine's Day increased by 40% to 50% over those of the previous few days," said the person-in-charge of the jewellery mall of Hangzhou Department Store Building.
During the recent Spring Festival period, the sales of spring fashion in shopping malls were not entirely satisfactory either. In terms of sales volume, the ratio of spring fashion over the total clothing sales showed a year-on-year drop of about 20 percentage points. "At present, the sales of spring fashion constitute 30% of the total clothing sales on average. But in February last year, the ratio was as high as 45% to 50%." According to the person-in-charge of the women's wear department of Intime Department Store at Wulin, the prices of new spring fashion used to be slightly raised in past years. Yet retailers dared not raise prices due to marketing pressure this year. "In the past, some brands will update their spring fashion products bi-weekly. But this year, even new arrivals on hand have not entirely hit the shelves. The quantity of spring fashion is basically the same as that of winter clothing," said a staff member of the ladies boutique department of Hangzhou Tower.
In short, the aggregate sales during the Spring Festival period were on the low side due to the overall economic climate as well as the cold, snowy and rainy weather. The turnover was low at the beginning and only turned higher subsequently. Besides, the new atmosphere of advocating "thrift and frugality" is another major factor that leads to the more significant drop in the sales of shopping malls as compared with the same period of last year.
In this connection, HKTDC Hangzhou Office surveyed three department stores / shopping centres in the city with findings summarised as follows:
HKTDC Hangzhou Office