Providers of wedding service bullish on H2 prospects, expect pent-up demand

Pan Qiulin is a 29-year-old bride-to-be in Shanghai.

She planned to hold her wedding ceremony on March 29. But the COVID-19 outbreak forced her to delay the event to July 28 to avoid the risk of infections among the wedding party. She is still uncertain how many people she will invite to the happy day.

A large number of couples like her have had to delay their weddings to a later date, and hurriedly informed their families and friends about the sudden change in plans.

Business retailers in the wedding market, photography studios, operators of wedding venues, providers of wedding dresses and rentals and wedding car rentals have suspended services because of the epidemic. Demand, though, is tipped to surge in the second half of the year.

The year 2020 is homophonic to the Chinese pronunciation of "love you, love you."

As a result, the romantic implications of 2020 have convinced many people to hold their weddings this year. Late in 2019, wedding planning companies nationwide received a deluge of orders, but their plans were disrupted by a disease that has caused a gap period for the whole sector.

"The epidemic will have a big impact on the cash flow of wedding planning companies, especially for some small and medium-sized enterprises who will face a more severe challenge," said Neil Wang, president of consultancy Frost & Sullivan China.

"In comparison, large companies with contingency plans and comprehensive customer services will be able to survive the crisis. At a later stage, large companies could acquire some smaller companies with their capital advantages, and expand their presence in the market. This will accelerate the reshuffle of the industry," he said.

Wang added that the operational costs of wedding venues are quite high, and operators need to pay monthly rents on time. Small firms may perish unless leaseholders cut rents.

Among the 1,912 wedding service companies that withdrew accounts in China in January and February, 73 percent of the total had a registered capital of less than 1 million yuan ($14.35 million), Frost& Sullivan said.

May, June, September and October are peak months to hold weddings. Business volume during those months can be twice or three times higher than usual.

The booming demand that will likely occur once the crisis is over is set to bring a new round of growth opportunities for the market, industry analysts said.

"Newlyweds don't usually cancel weddings, and prefer to just change the dates. It will stimulate a surge of the sector in the second half of the year, including the growth of O2O platforms and one-stop wedding services. Wedding planning companies should prepare for a burst of demand after the recovery," Wang said.

Bing Fan Image, a major wedding photography studio based in Beijing, said they will start shooting photos from March 20. Most of those who booked reservations to take photos in February and March changed their dates to sometime between May and July.

In the past month, the studio shut down its store and kept online communications with customers open.

The company said warmer weather is a peak season for wedding photo shoots. Newlyweds have to wait a while to get their photos taken. A major problem is that schedules in the summer are quite full and it is hard to book a date.

From 2014 to 2018, wedding market sales in China surged from 923 billion yuan to 1.64 trillion yuan, and the annual compound growth rate reached 15.5 percent.

By 2023, the wedding market scale in the country is expected to reach 3 trillion yuan, according to calculations by Frost& Sullivan.

"Those who were born in the 1990s have become the main drivers of the wedding market, and they are pursing more special and exquisite weddings. Their increasingly high requirements for wedding services will prompt retailers to develop better products and further drive growth of the industry," Wang said.