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European and American fashion designers feeling the pinch from the credit crisis can look to the growing ranks of China's nouveau riche to boost sales.
China's millionaires' club is expanding rapidly and many new members are women who don't even blink when asked to pay $10,000 (Dh36,741) for a cocktail dress from a top international designer.
"The Chinese are the newcomers to the global market," said Sebastian Suhl, Asia-Pacific chief executive of Italian fashion house Prada, which has nine stores in China.
"They're very hungry to learn about fashion. Fashion represents obviously status, but luxury is also a kind of bridge to the modern world for them."
As the Chinese economy surged more than 10 per cent annually over the past five years, the country boasted 345,000 millionaires (assets valued in dollars) by the end of 2006, a third of whom were women, according to a report by Merrill Lynch and consultancy Capgemini.
Some 5,000 mainland Chinese had assets exceeding $30 million, accounting for a third of Asia-Pacific's super-rich.
Even affluent Chinese women, without millions in the bank, are willing to spend their savings on designer fashions, seen as the ultimate status symbol in a communist country that is increasingly becoming preoccupied with the trappings of wealth.
Elegantly dressed Chinese manager Zhang Ning, 30, has never been to France but she likes to wear Hermes which she says is the epitome of style.
"I like its simplicity, it makes me feel elegant," said Zhang, who works as a manager at an electric power company in the southern Chinese city of Guangzhou.
"France for me is elegance: good fashion and wines."
Demand for accessories
While luxury goods makers such as Louis Vuitton have benefited from booming demand from Chinese keen to show off their newfound wealth by wearing clothes and accessories emblazoned with prestigious logos, Western couture houses such Hermes are now tapping into the more discreet tastes of the super-rich.
"The mainland Chinese market is still very accessories-oriented but we believe that will change," said Alex Bolen, chief executive of New York-based couture house Oscar de la Renta, whose sleek cocktail dresses retail for up to $10,000, while its evening gowns approach double that.
"There's definitely a market for the cocktail dress. But what has surprised us, pleasantly, is how rapidly the customer has also adopted our daywear."
Leading the charge is upmarket Hong Kong department store Lane Crawford which is bringing designers to China who are seen as being on the cutting edge in the West but are not well-known in China.
The opening of Lane Crawford's first store in Beijing last October has expanded the China presence of British designers such as Alexander McQueen and Stella McCartney and heralded the arrival of more niche designers including Dries Van Noten, Hussein Chalayan and Rick Owens.
Buyers from Lane Crawford now take prized front-row seats at fashion shows in Paris and Milan, alongside buyers from high-end US retailers Saks and Nieman Marcus.
Meanwhile, Chinese fashion editors, headed by Vogue China, have become an influential presence on the European fashion scene.
China's ongoing transition to a more market-oriented economy after decades of strict communist rule is producing a constant stream of newly rich.
Their purchasing power and the growing sophistication of a more established wealthy clientele is creating a very diverse market for fashion, says Angelica Cheung, editor of Vogue China. The magazine was launched in 2005 and it has 320,000 readers.
"It's very different from the West, there are a lot of entrepreneurial opportunities and there are wealthy people emerging all the time," said Cheung.
"A young woman who might now be on a monthly salary of 5,000 yuan (Dh2,649) could next year be running her own business. So it's a very aspirational market. Her first luxury product might be a Louis Vuitton bag but she might move on to something more niche such as Marni."
Chanel is the most preferred high-end fashion brand for affluent Chinese followed by Giorgio Armani, according to a report by MasterCard.
Oscar de la Renta says China is central to a strategy for Asia which it hopes will account for 20 per cent of its sales within five years, up from 5 per cent at present, helped by its burgeoning accessories' business.
Luxury brands can easily sell their perfume and cosmetics in local department stores. But when it comes to ready-to-wear fashion, they are all competing for space and customers in a handful of luxury malls such as Plaza 66 in Shanghai and Lane Crawford in Beijing, where rents are sky high.
"They're overpaying (on rent) but they're looking at China as an investment," said Marcel Braun, Hong Kong-based executive vice-president of Swiss company DKSH, which advises luxury firms on market expansion.
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