What Is the Current State of China’s Bag Industry for Fashion Brands?

Recently, the China Daily-Use Commodities Trade Fair (CDATF) released a market report on the Chinese bag industry in 2024, providing valuable insights into current conditions and future trends. Based on this report, here is an in-depth analysis and recommendations for brands and investors.

1. Industry Scale and Global Position

According to CDATF, the global bag market is expected to reach $187.6 billion in 2024, with a CAGR of approximately 3.93% from 2024 to 2028.

In China, the retail sales of bag products reached 231.89 billion RMB in 2022.

These figures highlight that China is not only a key consumer market but also a crucial player in global production and exports. The country’s bag industry enjoys strong international competitiveness, with exports significantly exceeding imports.

2. Consumer Trends: Quality, Personalization, and Sustainability

• Quality and Personalization: With rising living standards and changing aesthetics, Chinese consumers are increasingly seeking high-quality, personalized bags rather than just functional products. Consumers are willing to pay for design, materials, and brand value.

• Sustainability Awareness: Environmental consciousness is becoming a significant driver. Buyers are paying more attention to eco-friendly materials and sustainable production processes. The CDATF report emphasizes that green bags are seeing rapid growth in market demand.

3. Industry Structure and Market Landscape

• Highly competitive: The Chinese bag manufacturing sector is highly market-driven, with a large number of brands and manufacturers, and significant variation in product quality and price.

• Offline dominant but online growing: Physical retail still leads, but e-commerce channels are steadily increasing their share.

• Diverse product segmentation: Market offerings include handbags, travel luggage, briefcases, small bags, and more, segmented by function and material.

4. Opportunities and Challenges

Opportunities

• Mid- to high-end & luxury market: The shift toward quality offers growth potential for premium brands.

• Eco-friendly products: Increasing consumer sustainability awareness drives demand for green materials and processes.

• Online sales growth: E-commerce remains a crucial channel, especially among younger consumers.

• Product differentiation: Functional, design-focused, or smart luggage can stand out in a crowded market.

Challenges

• Product homogeneity: Many brands face difficulty differentiating themselves.

• Cost pressure: Using eco-friendly materials and innovative designs raises production costs.

• Intense competition: Domestic and foreign brands compete strongly in both high-end and export markets.

• Shifting consumer expectations: Buyers increasingly demand innovative design, functionality, and sustainability, requiring brands to respond quickly.

5. Recommendations for Brands and Investors

• Strengthen brand value: Focus on design, brand culture, and premium materials to create differentiated products.

• Invest in green innovation: Adopt sustainable materials and eco-friendly production processes.

• Embrace digital sales channels: Build an online presence on e-commerce and social commerce platforms while optimizing supply chains.

• Focus on niche segments: Target travel luggage, briefcases, and personalized/customized bags.

• Accelerate internationalization: Leverage China’s manufacturing and export advantages to expand globally.

Conclusion

The CDATF 2024 report shows that China’s bag industry is in a critical phase of transformation and upgrading. Consumers increasingly demand higher quality, better design, sustainability, and personalization, creating significant opportunities for innovative and brand-conscious companies.

For brands, differentiation + sustainability + digitalization are key to winning the market. For investors, China’s bag industry remains a sector with long-term growth potential.