The UK’s Luxury sector

Home to iconic brands such as Alexander McQueen, Burberry and Harrods, the UK is at the forefront of international retailing and luxury goods. From heritage brands with long traditions to iconic craftsmanship, look to the UK for your next luxury retail partner.

The global luxury sector grew 5% in 2017 to nearly €1.2 trillion (Altagamma). The UK’s slice of the sector is also set to grow, making up over 2% of the country’s GDP and predicted to be worth over £50bn to the British economy in 2019, compared to £32bn in 2013 (Walpole). The wealth and quality of goods on offer makes this substantial increase a little easier to understand, with products ranging from designer apparel and footwear to fine wines and spirits, from luxury accessories, jewellery and timepieces to high-end beauty and personal care, not to mention high-end car manufacturing. However, this breadth of products is just one reason why more businesses are looking to partner with the UK for their luxury requirements.

Why choose the UK ?

A DISCERNING OFFER, encompassing a wide variety of luxury products from bespoke gifts to high quality fabrics; global consumers recognise the heritage and uncompromising quality of British goods. Indeed, whilst 78% of British luxury goods are exported, these goods also act as a draw for overseas visitors – 2017 saw a 22% rise in tax free shopping from long-haul tourists purchasing luxury goods in the UK. (Altagamma).

CONSUMER PREFERENCE for British-made products that signify quality, reliability and innovation: consumers in developing economies are willing to spend +7% for products with the “Made in Britain” label (Barclays).

GUARANTEED RELIABILITY to deliver products and services on time, to specification and budget, offering long-term value for money by maintaining product integrity over time. Roger W Smith watches are a fine example of the quality of British craftsmanship, pursuing new standards of excellence to produce 10 exquisitely hand-crafted watches every year.

Original with a Commercial Mindset

The UK is home to two of the top five universities in the world for arts and design, fuelling its global reputation for crafting and innovating (the UK applies for the most trademarks in Europe) and supporting Britain to export 50% more design than it imports.

UK fashion ignites passion and imagination, making it one of the most influential fashion hubs in the world. Home to trailblazers Vivienne Westwood, Stella McCartney and Paul Smith, UK retailers were also the first in the world to bring designer collections onto the high street. The UK offers world-class design expertise in all types of clothing and accessories, and is a centre of manufacturing excellence of high-quality fabrics.

The industry is further strengthened by the calibre of talent graduating from our internationally renowned fashion colleges such as the Ravensbourne College of Design and Communication. Famous graduates include Alexander McQueen, Hussein Chalayan, Jonathan Saunders and Stella McCartney.

This passion for design and innovation transcends the luxury fashion and retail spaces. Rolls-Royce is an iconic British-founded brand with many years of experience in ideating and producing high-end vehicles for automotive consumers seeking a greater degree of luxury, prestige and quality. There is also a high global demand for its aerospace components – its engines power more than 35 types of commercial aircraft. Another example is Dixon Yacht Design, an award-winning British design studio making waves around the globe, working across five continents with the world’s leading shipyards and boat manufacturers to create beautiful, bespoke yachts for its discerning clientele.

UK centres of excellence

The UK offers luxury expertise that spans an incredibly diverse range of industries from haute-couture to leather goods, automotive and aviation interiors to luxury publishing. Across the UK, these powerful clusters of expertise include:

  • Birmingham  The Birmingham Jewellery Quarter covers 300 acres and includes over 100 specialist jewellery retailers, workshops, designers and craftspeople. It is an important centre for the jewellery trade, accounting for approximately 40% of all made in the UK.
  • London – Luxury retailing in London is synonymous with legacy, core retail locations. From the Mulberry and Alexander McQueen flagship stores on Bond Street, to the Stella McCartney and Matthew Williamson stores on Bruton Street. Old Bond Street and New Bond Street remain iconic.
  • London – Savile Row, famed across the world for its traditional men’s bespoke tailoring, is anchored by Gieves & Hawkes, a brand internationally-recognised for its quintessentially British style and luxury craftsmanship.
  • London – The Hatton Garden area has been the epicentre of London’s jewellery trade since medieval times. Today, it maintains its international reputation as the centre of London’s diamond trade. With almost 300 businesses and over 55 shops, Hatton Garden contains the largest and most concentrated cluster of jewellery retailers in the UK.
  • Northampton – World-renowned for shoemaking and leather craftsmanship. BLC Leather Technology Centre is the leading centre for leather innovation, working with hundreds of companies spanning over 40 countries. Famous names such as Dr Martens and Church & Co continue to thrive.
  • Scotland  Characterised by the manufacture of high-quality knitwear and woollen apparel. The Harris Tweed is still woven only in the Outer Hebrides by crofters in their own homes, using century-old methods. However, Harris Tweed’s enduring appeal means its products are found in surprising contexts, with many brands – including Topman, Nike, Hugo Boss and J.Crew – all making use of the fabrics.
  • Scotland – Scottish cashmere, with craftsmanship perfected over 300 years, is another thriving brand built upon a traditional guarantee of quality and luxury. Only one mill in the UK carries out the entire cashmere weaving process from raw fibre to finished garment, with the product supplied being used by many of the world’s most prestigious fashion houses including Chanel, Prada, Louis Vuitton and Burberry.

What next for the luxury retail landscape?

The UK appears well situated to continue its growth within the luxury sector as the category expands globally. However, it remains important to take stock the developing trends in the luxury industry.

Areas of growth in 2016/2017 included personal luxury goods (such as jewellery) at 5%, luxury cars at 6%, along with hospitality, food and drink (between 4% and 6%). The only area of decline was seen in the jets segment (-2%) due to general economic uncertainty in most markets. There has also been a clear shift in buying habits as the millennial generation becomes a more significant proportion of the consumer base – they now make up 30% of the market, yet accounted for 85% of growth in the sector last year. Much of the millennial spend was funnelled online, which saw a 24% increase on 2016 (Altagamma).

As with the retail sector more generally, the trend of spending less in-store and more online does not appear to be abating. It will be intriguing to witness how the UK and the global luxury sector respond to these diversifying consumer behaviours and whether more luxury brands look to roll out an integrated consumer journey along several touchpoints, both physical and digital, as they increase their interaction and engagement with the growing cohort of millennial consumers.

Conclusion

Today’s business context for luxury is strong and the UK’s offer is undoubtedly compelling and uniquely appealing. Take advantage of the UK’s clusters of expertise to provide you the benefits of a concentration of skills, supply-chain efficiencies and minimal travel time: for quality craftsmanship and true retail distinction, choose the UK as your next luxury partner.

Visit great.gov.uk/trade to find your perfect partner today.

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