LUXURY brands will increasingly have to court Chinese shoppers on their home turf, as local purchases soar among a clientele who are forecast to generate nearly half the industry’s sales by 2025, a study showed.

Global sales of personal luxury goods like handbags and watches are on course to grow 6 percent at constant currencies this year, on par with 2017, according to consultancy Bain and Italian manufacturers association Altagamma’s report, which valued the market at 260 billion euros (US$294 billion) in 2018.

That pace will slow in the medium term to 3 to 5 percent per year, they forecast, with potential “bumps” along the way like the risk of a U.S. recession or an easing pace of China’s economic growth.

But leaving aside worries about a Sino-U.S. trade war’s impact on high-end labels, Chinese consumers will continue to grow in stature for the luxury industry.

Accounting for 33 percent of purchases now, they will anchor 46 percent of the market by 2025, the report said.

Half of those sales are forecast to take place within China by then, up from a quarter today, against the backdrop of a global industry landscape that for the most part remains benign.

“The market fundamentals are very sound,” said Federica Levato, a partner at Bain. “There could be some slight slowdown in the near future, in the next 12 to 18 months, (but) we don’t think this will distract brands from a very solid market.”

China’s luxury shoppers are already propelling sales bounces at brands from France’s Louis Vuitton and Christian Dior, owned by LVMH, to Italian puffer jacker maker Moncler.

At one of the fastest-growing labels, Italy’s Gucci, some 45 percent of Chinese clients’ purchases already take place domestically, executives at parent Kering detailed in October.(SD-Agencies)