The Government released the latest total Retail Sales Value (RSV) of January 2020, which registered a year-on-year drop of -21.4% to HK$37.8 billion.
Despite the narrowed drop of total RSV in December 2019, with the novel coronavirus outbreak and the drastic decline of Mainland visitors since January, the shopping sentiment has been seriously dampened. The market situation deteriorated rapidly towards the end of January when the city started fighting against the spread of virus.
Amongst all retail categories, those high-value and/or tourist-related ones registered severe drop. Jewellery, Watches & Clocks, and Valuable Gifts remained the hardest hit category with a drop at -41.6%, while others such as Medicines and Cosmetics and Department Stores looked less impacted but still suffered tremendously at -32.3% and -27% respectively.
Evidently all retailers in suffering categories are struggling for survival. While retailers are taking their own cost-cutting or other measures, the Association's representatives have been meeting with major landlords, senior Government officials, bankers, and other key stakeholders since early February, in order to obtain effective assistance for our industries so as to minimize the damage that would lead to staff layoff, business downsizing or even closures.
We welcome the Government’s Anti-epidemic Fund of HK$ 30 billion announced earlier, from which HK$5.6 billion is dedicated for the Retail Sector Subsidy Scheme, that is aimed to tide suffering retailers over during the difficult times.
We believe a subsidy of HK$80,000 per store would give some breathing space to them. However, the ceiling of HK$3 million subsidy in total for a retail chain under one business registration sets a limit on the financial assistance. In other words, not all retail shops especially those in suffering categories can be assisted.
Based on our internal information, we estimated that the number of employees under those unassisted retail shops could be close to 40% of total employment in the retail industry of Hong Kong. Due to this reason, our Association has strong reservation on the ceiling, and is raising our concerns and objections to the Chief Executive of our Government. Meanwhile, in order to assist members with the online application of the subsidy, which will start from 23 March till 12 April, we have sent out a step-by-step flow chart for members’ reference.
The Association is closely monitoring the situation around the pandemic as it evolves. To keep members abreast of the latest development, we have set up a designated website to include useful information and resources, covering the Government measures, as well as best practices regarding human resources, legal, and financial issues. Due to the pandemic, some of our events have been deferred or cancelled, and a few of our seminars have been changed to online format. It is with much regret that for public health reasons we have also cancelled this year’s Hong Kong Retail Summit.
Against all odds, the Association will make its best effort to fight for the interest of our industry and to lobby various stakeholders tirelessly especially the landlords to ensure the sustainability of the industry amid the current crisis.
Last but not least, we hope this pandemic would end soon, and everyone would stay healthy. Let’s keep thinking positively towards the coming challenges and future development of our businesses.
