Luxury industry gained success in second-tier Chinese cities

The luxury industry gained a foothold in the second-tier Chinese cities, generally away from the coast and experiencing record growth for the emergence of new rich.

The country has 146 billionaires, up 14% over last year, only behind the United States, according to the latest ranking on the second global economy released recently by Forbes magazine.

China is the fastest growing market for the luxury industry and should be number one by 2015 (before the United States) for all luxury products – cosmetics, bags, watches, shoes and clothing – according to consultants PriceWaterhouseCoopers .

The wealthy inhabitants of megacities in the provinces often have greatly benefited financially from soaring property prices and economic growth which is now faster than those cities on the coast.

While many residents of Beijing and Shanghai prefer to go to Hong Kong and Europe to do their shopping, people in other major Chinese cities are less likely to travel abroad and thus consume more in China. The Chinese are expected to spend 15.6 billion dollars in luxury goods this year, an increase of 20% over last year, with 40% of the purchases in China.