Recently, a well-known international investment bank Goldman Sachs reported that the recent changes in the domestic economic environment, such as rising food prices and the cooling of the stock market and the real estate market, will bring a chain reaction to the clothing and footwear market, but the impact is limited. There is no need to worry about it.

Despite the recent business data released by two leading stores in China, Parkson and new world, in recent months, the two department stores operating mainly in clothing sales have experienced a moderate slowdown (from 18% to 20% in 2007 to around 15% in the second quarter of 2008), but Goldman Sachs still believes that the changes in domestic economic environment have not adversely affected consumer spending on clothing and footwear, and that revenue growth is the main driver of department store sales, and that further slowdown in department stores may be limited.

Earlier, AC Nielsen Co also made a related survey. The survey results were not optimistic at that time. 43% of the respondents surveyed said that they were going to make a careful calculation of the consumption of clothing products and reduce their expenditure in the future, due to the impact of rising food prices and the cooling of the stock market.

This is also contrary to Goldman Sachs's "limited impact" conclusion.

Goldman Sachs believes that food inflation has not had an adverse effect on clothing and footwear spending.

In fact, food inflation generally shows a positive link with clothing spending.

There is no realistic evidence to support the substitution of food and clothing.

Goldman Sachs pointed out in the report that the fundamental factor affecting the consumption of clothing and footwear is the level of income growth of consumers. There is a large correlation between clothing sales and income growth, with an average correlation of 68%.

In the first quarter of 2008, revenue grew by 19.2% over the same period last year.

Therefore, in the case of income growth, the further slowdown in clothing sales in the future may be limited.

But Goldman also acknowledged that the wealth effect, especially the real estate market and the stock market cooling, will indeed have an impact on clothing spending, which will have a certain impact on consumer clothing consumption because of the shrinking wealth of consumers.

It is reported that in 2008, China's stock market has shrunk by nearly half from its peak in 2007.

In the real estate market, in recent years, the housing price has been rising too fast, the tightening macro-control and the oversupply of the real estate market. The domestic real estate market has a strong wait-and-see atmosphere and the volume of pactions has plummeted.

After a survey of 4 first tier cities and 8 two tier cities, including Shanghai and Beijing, Goldman Sachs expects that property prices will need to be cut from 10% to 20% at present level to stimulate demand, and in the coming year, China's domestic prices will fall by at least 15% due to the rapid growth of housing prices, the uncertain macro environment, the tight capital chain of domestic real estate developers, and the oversupply of market.