Core Points - Harrods will close its Shanghai operations, including the Harrods Mansion and Harrods Tea Room, by January 2026, and will dissolve the local team [1] - The decision is attributed to a misalignment of the business model with the Chinese market, which favors local business associations [1][3] - Harrods aims to focus on providing experiences and services in the most influential areas of China [1][3] Company Overview - Harrods opened the Harrods Mansion membership club in late 2023, located in a historic building in Shanghai, featuring a Michelin-star restaurant by Gordon Ramsay [3] - The membership fee starts at 150,000 yuan, with a cap of 250 members, offering exclusive social events [3] - In 2023, Chinese consumers accounted for approximately 8% of Harrods' sales, with a 7% increase in Chinese customers at the Knightsbridge store [3] Market Context - The closure may be influenced by strategic adjustments from the property owner, Swire Properties, following the success of LVMH's "Louis Ship" installation, which attracted significant foot traffic [4] - The average daily foot traffic at Swire Properties' location reached 80,000 to 100,000 visitors, with surrounding areas seeing over 50% year-on-year growth in foot traffic and sales [4] - Harrods plans to continue engaging with local partners and exploring local wholesale opportunities despite the closure [4]

Core Viewpoint - Harrods has announced the closure of its Shanghai operations by January 2026, including the Harrods Mansion and Harrods Tea Room, citing a misalignment of its business model with the local market [1][3]. Group 1: Business Operations - Harrods Mansion, which opened at the end of 2023, was a high-end private service project targeting Chinese customers, featuring a Michelin-starred restaurant by Gordon Ramsay and a membership fee starting at 150,000 yuan [3]. - The decision to close operations is linked to a strategic shift by the property owner, Swire Properties, which has seen increased foot traffic and sales in the area due to other luxury brands like Louis Vuitton and Dior [4]. Group 2: Market Insights - In 2023, Chinese consumers accounted for approximately 8% of Harrods' sales, with a 7% increase in Chinese customers at the Knightsbridge store, indicating a potential for growth in the Chinese market [3]. - Despite the closure, Harrods plans to continue engaging with the Chinese market through pop-up events, local talent discovery, and digital community interactions [3][4].