TAIPEI — Renewed confidence among Taiwanese consumers and ever increasing arrivals of deep-pocketed Chinese tourists is sparking a retail revival here.
Department stores are riding the boom and at least eight major complexes are slated to open over the next two years. The most anticipated is the October debut of the Uni-President Hankyu Department Store currently under construction above the Taipei City Hall MRT. It will be in the same neighborhood as several upscale stores, including the Shinkong Mitsukoshi, Pacific Sogo and Taipei 101, formerly the world's tallest building and currently home to the Taipei 101 Mall.
Uni-President Hankyu promises a fresh brand line up. Few details are known except that the seven-story complex will include in its basement a 25,607-square-foot Uniqlo store, the island's first.
“People are buying luxuries at department stores again,” said Liang Yi-Fong, analyst, Taiwan Institute of Economic Research. “Consumer confidence is up. Corporations are raising salaries slowly but steadily. Some people enjoyed capital gains from stocks.”
Uni-President, a food and retail conglomerate, will try to wrest business from rivals Shin Kong Group (SKG) and Far Eastern Group (FEG).
SKG, a life insurance group opened the first Shinkong Mitsukoshi in 1991. That brought it into direct competition with FEG, which had pioneered a chain of domestic department stores decades earlier. FEG bought an interest in Pacific Sogo in 2002.
Today, there are 18 Shinkong Mitsukoshi stores, 9 Far Eastern Plazas and 8 Pacific Sogos in Taiwan. That gives the SKG and FEG half of the 62 department stores listed by the Taiwan Department Store Association.
Taiwan Institute’s Liang expects the shopping boom to continue into the second half of the year. Even if sales by Taiwanese slacken, there could be an increase in sales from Chinese tourists if individual travel is allowed next year.
Taiwan currently requires Chinese tourists to join tour groups. Restrictions on tourists from the mainland were relaxed in July 2008, and this year 1.2 million Chinese are expected to visit the island, displacing the Japanese as Taiwan’s top visitor group.
Many Chinese come to Taiwan to shop for luxury goods. Prices are lower, mainly because Chinese shoppers can circumvent the luxury tax in their country.
Already, one Chinese retailer Hengdeli, a seller of fine timepieces has set up shop in Taipei. Chinese shoppers can sign up for service contracts valid on the mainland.
Other key store openings that are taking place over the next two years include the debut of the Fubon Momo, ATT Square and Q-Square complexes in Taipei. Also a Far Eastern Plaza is slated for suburban Banchiao while a Pacific Sogo will open in Hsinchu.
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