Opportunities in China: A Glance
With its growing economy and high consumer spending, there will continue to be plenty of opportunities in China for all kinds of consumer goods in 2020. Increased consumption is expected on organic and health care products as consumers seek a healthier lifestyle. Demand for baby care products, fashion clothing and luxury goods will also continue to rise.
Biggest Opportunities in China in 2020
China is the world’s fourth-biggest market for organic food. The market is estimated at US$13 billion and is expected to grow by 14% in 2020. The United States, Australia and the European Union are the major import sources of organic products for China. Vegetable items are the most common organic food purchased in China, followed by grain, tea and fruit. Supermarkets and hypermarkets are the main retail channels for organic products, but are facing increased challenges from online retailers.
The two-child policy and rising household incomes are very likely to boost baby product consumption in China. Strong growth is expected in the demand for baby care products through 2020, with offline and online sales increasing by 18%. China will likely account for 45% of the global demand in baby care products by 2020. Imported products will continue to dominate the market due to parents’ distrust of domestic products following repeated safety scandals. Quality and reputation are the most important factors when deciding to make a purchase.
China’s health-care sector continues to develop at an astonishing rate. Spending is projected to grow to US$1 trillion in 2020. Health-care expenditures have more than doubled in the past decade. From pharmaceuticals to medical devices to traditional Chinese medicine, almost every health sector has benefited. The country’s aging population and underdeveloped aged-care sector also represent a potentially big opportunity for businesses.
China’s fashion industry is set to become the world’s second biggest by 2020. Total fashion sales are expected to be triple their current level. China’s 1.3 billion population constitutes a huge market for garments. Women’s garment market is expected to reach US$169 billion by 2022. Demand for clothing with personal style is on the rise, with designer labels gaining increasing popularity. Meanwhile, the consumer market for men’s garments is undergoing a growth period. Market value is expected to reach US$94 billion by 2022.
China will be the world’s biggest luxury goods market by 2020. Currently, it accounts for about 33% of all global luxury spending. This is expected to surge to 65% in the next five years. Millennial and Gen-Z consumers account for 46% of luxury spending in China. There is a growing desire for individualism and authenticity among consumers. For the younger generation, demand for unique, custom made products is expected to rise.
Plan Ahead for 2020
2020 will continue to mark a major shift in China’s consumer market. Consumers are expected to spend more on quality products as they sought to improve their lifestyle and overall living conditions. Early and strategic planning is needed for businesses to succeed.