. Low labor costs
Being the workshop of the world, China has its own
advantage of low labor costs and raw material costs,
the benefit that attracts multinational companies to
outsource their manufacturing tasks to China.
Hence, a local luxury company has the competitive
cost advantage over multinational corporations.
Nonetheless, the Chinese labor costs are skyrocketing
due to urbanization. Moreover, the payment of
key employees, such as designers and managers, are
bound to be higher in luxury industry.