December 21, 2023

20 floor managers or procurement managers in China at high-end shopping malls (4) and upper-midlevel (9) and midlevel (7) malls and department stores

REPEAT SOURCES 20 from OTR Global’s September report


Spending Power Decline Continues

China’s economic downturn has continued to hurt consumer spending at shopping malls during 4Q23, especially on high-ticket items, and few managers expect consumer spending power to improve in 1Q24.

• 4Q23 Chinese mall/department store sales below plan for 11 of 20 sources (vs. 7 of 20 in 3Q23); sales up 16%–21% yy (vs. up 7%–12% yy in 3Q23) because of easy comps

• 4Q23 luxury brand sales up 8%–13% yy (vs. up 2%–7% yy in 3Q23), aided by easy comps but hurt by luxury consumers spending less, less frequently vs. 6 months ago

• Restaurants, gold and outdoor outperformed; non-athletic apparel and shoes lagged

• 1Q24 yy mall sales expected up 4%–9% yy; consumer spending expected to be similar qq for 8 of 20 sources, weaker for 7

Consumer Discretionary