Harrods boss criticises Chinese visa proposals

Chinese tourists Harrod's - China Elite FocusThe boss of Harrods, the prestigious London department store, has warned that proposals by the Coalition to simplify visa applications for Chinese tourists are “smoke and mirrors”.
UK retailers have pressed the Government to overhaul the Chinese visa system because of concerns that the UK is missing out on spending to other European countries.
However, Michael Ward, the managing director of Harrods, said that measures unveiled by George Osborne, the Chancellor, during a trade mission to Beijing are likely to have little impact.
Speaking at a breakfast for the chief executives of luxury brands organised by trade body Walpole, Mr Ward said the Chancellor’s proposals were “smoke and mirrors” and would not help wealthy tourists travelling independently.
Business leaders have warned that the UK is losing £1.2bn of sales each year because Chinese visitors are put off by the complex visa process. Tourists travelling to Europe from China must apply for a separate UK visa alongside the Schengen visa system, which is cheaper and allows Chinese tourists to visit more than 25 other countries in the EU including France.
In October, Mr Osborne introduced a new pilot scheme that will allow tourists to secure a UK visa by only submitting the EU’s Schengen visa.
However, the scheme only applies to selected Chinese travel agents and Mr Ward said the proposal will “do nothing” because the government in China is clamping down on tour groups.
As part of a corruption crackdown, Chinese authorities have passed a law restricting tour groups because of concerns that the tour guides were taking bribes to take visitors to certain places.
Mr Ward said that regulations should boost the UK, but that it means the visa proposals will have minimal impact.
The Harrods boss said that most of the company’s Chinese shoppers were young consumers travelling independently of tour groups. “The Chinese consumers are very young, aged 20 to 25,” he added.
Giles English, the co-founder of watchmaker Bremont, also called for the Government to streamline the visa process for Chinese visitors.
“Anything that makes it easier is only going to help us all,” Mr English said.
The UK China Visa Alliance, which has led calls for the system to be reformed, has calculated that only 6pc of Chinese visitors to Europe obtain two visas, while 85pc obtain only a Schengen visa and just 9pc get a UK visa.
Source: The Telegraph, article by Graham Ruddick

Advertisements

Luxury brand boom anticipated as wealthy Chinese tourists head to UK for Chinese New Year

Luxury stores are preparing for thousands of wealthy Far Eastern shoppers to coincide with the start of the Chinese Year of the Dragon.
The easing of travel restrictions in China means the turn of the year has become a time for international travel and shopping for the country’s elite.
They will be looking for British brands such as Burberry and Mulberry, and international brands such as Prada and Gucci.
Spending by Chinese tourists in UK stores rose by 64 per cent last year, say retail analysts Global Blue, and totalled £165million.
Bond Street shops have hired Mandarin-speaking staff while Harrods has installed 75 tills for Chinese shoppers and the UnionPay card, which is China’s only domestic debit and credit card.
And yesterday, the store unveiled commemorative investment gold bars, each incorporating an Oriental Dragon, in a bid to appeal to the tourists.
Richard Brown of Global Blue said: ‘Chinese New Year reflects an important cultural shift in China with families now travelling abroad as an alternative to celebrations at home.’
‘Retailers are bracing themselves for a significant uplift in Chinese shoppers and hope to repeat staggering growth.
‘Luxury brands are set to benefit the most from this uplift, with Chinese shoppers spending on average £729 per tax free transaction favouring handbags, jewellery and watches.’
Mark Di-Toro, from VisitBritain, said: ‘The first half of 2011 witnessed a record high in outbound tourism from China. The UK is already benefitting from these high spending visitors who are coming to Britain to shop in their droves.
‘In the West End, Chinese shoppers are reported to spend an average £1,310 during a trip with half of Burberry’s sales in London coming courtesy of Chinese tourists.’
Burberry benefits from the fact that the Duchess of Cambridge has been seen wearing a number of the brand’s trademark coats.
Gordon Innes, chief executive of London & Partners, the capital’s official promotional organisation, said: ‘With its large population, strong economic growth and growing social mobility, China is viewed as a lucrative tourism prospect.
‘In the year ending September 2011 visitor arrivals increased by about 40per cent with the average stay length among Chinese visitors  twice the average of all overseas tourist  – making them prodigious spenders.’

Source : http://www.dailymail.co.uk/

The power of China Union Pay cards readers

Wealthy Chinese tourists with money to spend don’t need an excuse to buy luxury goods, but they do need the plastic to facilitate their purchases. That’s why it wasn’t until Harrod’s installed special Chinese credit card readers in its stores earlier this year that the store could boast it had sold two bottles of £25,000 wine, and one £140,000 diamond to Chinese customers.
The store has seen a 40 percent increase in salesto wealthy Chinese tourists since installing 75 China Union Pay terminals into its London store.
Using data from VAT reclaim forms (UK sales tax can be reclaimed by visiting tourists at the airport), the luxury store has calculated sales to wealthy Chinese have risen to an average of £3,500 per tourist.
According to the recent statistics released by the ultra high-end travel club for rich Chinese “Shanghai Travelers’ Club”, 37% of Chinese travelers to the UK are ready to spend more than £54,000, and 12% of them is ready to spend more than £70,000 in London!
The increase is largely due to the fact that Chinese bank cards are not recognised outside of China because they use a separate card processing method via China Union Pay card terminals. According to one Chinese saleslady at Harrods, Chinese tourists visiting from the mainland have to bring “a lot of cash” when they travel abroad because so few places have CUP terminals.
In London, the only other store that has the terminals is Selfridges where sales to Chinese shoppers have seen “double digit growth” since the installation of CUP terminals last June, according to a spokesperson.
Making it easy for Chinese tourists to spend money with their domestic cards seems to be a no-brainer. Looking around the store, small groups of Chinese customers now feature prominently. So too do tour groups, who arrive at the store en masse. Harrods’ Mandarin speaking staff say they handle on average 20 to 30 Chinese visitors a day. During Chinese holidays like New Year in February, and two week-long holidays in May and October, coach parties with up to 70 tourists is standard fare.
Joined by telephone from Hong-Kong, Pierre Gervois, CEO of China Elite Focus declared “Luxury retailers should install China Union Pay readers and hire more Chinese speaking staff” He added “It’s the key to success to increase sales with wealthy Chinese tourists”
One Mandarin-speaking sales assistant told beyondbrics that Hermes is the most popular brand, followed by Chanel, Louis Vuitton and Dior. Speaking about their Chinese clientèle another spokesperson said, “they are some of our most discerning customers.”
On a recent trip to the store, one young Chinese shopper from Chengdu, studying at Manchester University, said Chanel was her favourite brand. Her male companion, who was carrying a giant Chanel carrier bag filled with her purchases, quipped: “It used to be Arabs who were the richest shoppers. Now it is the Chinese, isn’t it? Next, it will be the Indians.”