City draws up detailed five-year plans for new future

Beijing, which boasts a history of more than 3,000 years, is working hard at self-promotion in its quest to become an international consumption hub.

The city, with a population of more than 21 million, already boasts a mix of the ancient and modern, the traditional and the trendy.

With its residents now having more disposable income, and as investors' confidence increases, the Chinese capital aims to transform itself into an influential and competitive global consumption center in the next five years.

The vision for such ambition is not lacking in detail, with the municipal government carrying out a series of measures to make this dream come true.

Yan Ligang, head of the Beijing Commerce Bureau, said at a recent forum that the city would strive to set up "world-level business circles", increase inbound tourists and raise consumption power to realize its goal.

Young people－whether in Shanghai, Tokyo, New York or Paris－drink at outlets such as Starbucks, wear Uniqlo attire and buy furniture from Ikea. However, such major brands worldwide are becoming increasingly similar due to globalization.

Brands located in shopping malls in Chinese cities are no exception to this trend.

Against this backdrop, Beijing is striving to offer more choices and encourage local innovation by providing incentives to introduce "first stores" to the city.

Italian designer Gianvito Rossi, who in April chose Beijing to launch his brand's first store in China, said, "China has always been an important market for us, as Chinese consumers shop at our boutiques worldwide."

Founder and creative director of Gianvito Rossi, a brand focusing on women's fashion, he said Beijing is a major destination for luxury shopping.

"We've identified the city as the right starting point for our brand expansion in the Chinese market," he added.

Kevin Liu, general manager in charge of Chinese mainland and Hong Kong for fashion and fragrance business Puig, said choosing Beijing as the location for its first store stocking French brand Christian Louboutin cosmetics in China was a significant decision that would help the brand's long-term development.

"The group held several rounds of assessments and discussions before deciding to set up this store in Beijing when we entered the Chinese mainland market," Liu said.

"As the capital of China, Beijing has unique advantages in internationalization. It is also the center of the nation's politics, economy and culture."

Liu said revenue at the store in the first month after it opened in July surpassed expectations.

Both Gianvito Rossi and Christian Louboutin set up their first outlets in China at the SKP Beijing department store, the nation's biggest and most productive retailer, which achieved 17.7 billion yuan ($2.75 billion) in sales last year, outpacing renowned United Kingdom store Harrods' pre-pandemic performance.

Xie Dan, deputy general manager of SKP Beijing, said Chinese consumers contribute 35 percent to global fashion consumption, while only a small proportion of this total used to occur in China, meaning that the nation offers huge potential.

"SKP has continued innovating to provide a better consumption experience for customers," she said.

When customers shop at SKP in the Sanlitun area of Beijing or in Guomao, the city's central business district, they notice that both areas have become more fashionable and stylish by holding lively events and attracting a range of global brands.

SKP-S store, a new outlet one street away from SKP Beijing, opened in December 2019, targeting younger customers. It has attracted many well-known global brands, including Prada, to launch stores or hold events.

The Prada SKP-S store has staged a series of thematic pop-up projects with distinct installations and interactions inspired by a variety of themes.

Armando Tolomelli, CEO of Prada Asia Pacific, said the futuristic concept of SKP-S inspired the company's strategy of investing in such space and attracting new and younger customers.

"We took advantage of SKP's vision to open this first creative space in Beijing, as the city is obviously one of the most important markets for us in China," he said.

Tolomelli said the Prada SKP-S store's sales performance is ahead of initial expectations.

Local boom

As more international brands set up shop in Beijing, domestic ones have found new opportunities, thanks to local government support and incentives.

According to the Beijing Municipal Government, brands that have recently opened or are opening their first stores in the city are eligible for subsidies of up to 5 million yuan as part of the capital's efforts to become an international consumption hub.

More subsidies are available for stores that are the first on the Chinese mainland or in Asia.

Beijing also supports first flagship bricks-and-mortar stores introduced by intermediary agencies, the owners of commercial compounds, as well as internet platforms. The subsidies must be used to build, decorate and rent stores.

This policy has achieved notable results. According to the commerce bureau, 696 first stores, including flagship outlets, opened in Beijing in the first three quarters of this year－513 more than the total number of such stores that opened in the city last year.

Of the 696 stores, 588 are occupied by domestic brands, accounting for nearly 85 percent of the total, and the remainder are from overseas－including 19 from Italy, 18 from the United States and 15 from France.

FAO Schwarz, one of the world's oldest toy companies, opened a first store at the China World Mall in Guomao in May 2019. The company has benefited from the capital's policies, receiving 5 million yuan in subsidies from the local government.

Kidsland International Holdings, a toy retailer with headquarters in Beijing, has introduced its products to China.

Zhong Mei, managing director of Kidsland China, said the group has great confidence in the Chinese economy and market development in Beijing.

"The municipal government has acted quickly and firmly," she said. "I got to know about the policy from news reports and asked a colleague to find out the details. Several months later, we received the subsidies and a lot of other support from the local authorities."

Cao Xiang, executive director of China Nobleness International and founder of Choo Noble Art Interactive Cafe, said Beijing residents have huge consumption power, which led her to open a store at the China World Mall.

The store offers a space for customers to draw with crayons imported from Switzerland while enjoying a cup of coffee or tea.

"It's all about experiences. People are now wealthier than they were, but also more stressed. They sometimes need a place to slow down and enjoy their time by quietly doing some art," Cao said.

As the city modernizes, it is integrating its modes of business with innovation.

For example, Choo Noble is a mix of art room and cafe, while Be Gallery in Sanlitun is a combination of photo studio and select outlet.

A large retail space displaying artworks and offering photographic services, Be Gallery opened a first store in Sanlitun at the start of this year.

Jiang Lin, 40, co-founder of the brand, which is headquartered in Shanghai, said the Beijing store launched with a totally new concept tailored for local residents.

"We are cooperating with more than 130 overseas brands in an attempt to introduce fine art from around the world to our customers," Jiang said.

Every two months, the store holds art exhibitions with different themes.

"Beijing has a much more mature market than we thought, and people here have a big interest and curiosity about the quality of life, which is good news for our business," Jiang said.

He added that revenue growth at the store has been higher than expected in recent months and predicted that it could recover its costs in two years－less time than previously estimated.

By 2025, Beijing aims to attract more than 3,000 first stores to the city and to launch more than 100 consumption brands, according to the local government's plan.

Added significance

The central government has announced that five cities－Beijing, Tianjin, Shanghai, Chongqing and Guangzhou, capital of Guangdong province, will become international consumption hubs.

Gu Xueming, president of the Chinese Academy of International Trade and Economic Cooperation at the Ministry of Commerce, said, "Building an international consumption hub should strengthen Chinese cultural confidence, which can showcase consumers' trust and acknowledgment of products made and created in China."

He said the five cities should pursue industrial development on a number of fronts, adding that only if industries such as commerce, tourism, culture, sports and exhibitions grow well will the cities have a larger impact as international consumption hubs.

Gu said it is important to use digital technology and to maintain a green and sustainable consumption concept.

Charming city

Li Li, a white-collar worker in Beijing, likes to spend weekends reading in bookstores, watching a movie and visiting a museum with friends.

"I think Beijing has its charm, not because of its modern buildings and facilities, but due to its unique history and tradition," she said.

"I have been to the Forbidden City many times, but I still want to go there, because every time it gives me a new feeling. This is why I also like to go to cultural venues to enjoy literature and art."

On Oct 15, the capital launched a weeklong event, "Artistic Beijing", with the organizers staging 69 art exhibitions and auctions. A total of more than 60 art galleries and auctions are open for the public to experience the city.

Li said she would probably spend a lot of money during the event.

Wang Haiwen, assistant dean at Beijing International Studies University's School of Economics, said during a forum that with its high-quality consumption structure, Beijing should lead the way in producing a higher level of cultural products.

"Meanwhile, the city should consider how to stimulate foreign consumers' interest in spending on local culture," he added.