The prefect (Retail) storm in HK
Recently, HK retailers are losing money, losing their costumers and their stocks are losing value. The weakening pace of retail sales in Hong Kong is a combination of many reasons including decreased spending’s of mainland Chinese tourists, the demonstrations that took place in HK last year, e-commerce sites and the latest blow is the recent devaluation of the RMB: Since the HK Dollar is pegged to the USD, it means that Chinese RMB is now worth less in HK.
Slowing retail sales immediately translate to pressure on property owners to lower rents, and since some retailers are also property owners- they lose twice. Some reports predict a drop of 25%-40% in rents in Monk-Kok and Causeway Bay areas, and some spaces will be just left empty. According to SCMP, Hong Kong’s retail leasing market is in its biggest state of turmoil for a decade, and Global brands are threatening to leave HK if rents are not taken down. TAG Heuer has already announced its closing of CWB shop, and others have announced they are seeking lower rents.
(Publishes on SCMP, 2015 figures)
All of this translates very fast to drops in stock prices of major retailers and property owners and developers in the HK stocks market.
So what can be done? According to a recent op-ad in SCMP, local retailers should evolve , and according to my opinion there is a lot that can be done:
- Lower costs of operations by using smart technologies: Energy spending’s can be cut by using energy-saving solutions such as EnVerid’s system which dramatically reduces costly air replacement (while maintaining excellent indoor air quality); using energy efficient lighting systems such as those of MetroLight, which is used to improve business performance through reduction of energy use and maintenance costs; or just use a smart system to monitor and optimize energy consumption using a solution like Panoramic Power’s.
- Attract more clients using O2O solutions such as Screemo’s that helps retailers to engage with their customers in real-time and to create a call to action by using fun, engaging games that runs on digital screens and attract customers to interact using their smartphones; WinkApp’s proprietary technology which bridges Offline with Online and creates a new world of user engagement, stickiness and monetization opportunities for retailers; Cimagine’s solution which enables consumers to use their mobile and wearable devices to visualize products in life-like 3D, at a click of a button, in their homes or at the store; and many other solutions as well.
- Find new ways to re-invent and disrupt your own business, with ideas such as Pop Up shops (instead of a fixed shop- a possible solution for both brand and shop owners); build e-commerce sites with special features; find new ways to monetize further with your existing customer base etc.
Don’t wait for others to disrupt your business! New ideas and solutions are now the “bread and butter” of many people around the world who are working on INNOVATION! Make good use of it and innovate your business.