Date
24 July 2017
Mainland tourists aren't coming to Sasa stores in the big numbers they used to. Photo: HKEJ
Mainland tourists aren't coming to Sasa stores in the big numbers they used to. Photo: HKEJ

Sa Sa to shift stores away from tourist areas

Retailers are coming to grips with the fact that the go-go growth era for tourist arrivals from the mainland is over.

Cosmetics chain Sa Sa International Holdings Ltd. (00178.HK) is one of them.

It plans to replace more of its Sasa stores in Hong Kong’s tourist areas with new ones in residential areas, the Hong Kong Economic Journal reported Friday.

The firm will decide to retain an old store in a tourist area only after weighing the costs and benefits, although it has no plan to reduce the total number of stores or headcount in the city, chairman Simon Kwok Siu-ming said.

Rents at some Sasa stores have been cut by 20 percent because of the lackluster prospects for the retail market.

A stronger Hong Kong dollar, prompting Hongkongers to shop overseas, also weighs on Sa Sa’s average sales per invoice, Kwok said.

However, the firm is opening more stores in China’s free-trade zones, with the one in Qianhai, Shenzhen, set to debut in the middle of December.

The retailer issued a profit warning earlier, saying its net profit for the first half of the current financial year is likely to drop by more than half.

[Chinese version中文版]

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Sa Sa International Holdings Ltd. (00178.HK) is seeking to replace more of its stores in touristic areas with those to be opened in local residential areas, in a bid to cope with the poor outlook in the city’s retail market, the Hong Kong Economic Journal reported Friday.

The company will only decide to retain an old store in touristic areas after measuring the costs and benefits, although it has no plan to cut the total number of stores or headcounts in the city, said chairman Simon Kwok Siu-ming.

 

Some of the company’s stores have seen their rents cut by 20 percent due to lackluster sentiment in the retail market.

 

A stronger Hong Kong dollar prompting local people to travel overseas also weigh on the company’s sales in terms of average sales per invoice, Kwok added.

 

It, however, is opening more new stores in China’s free-trade zones, with the one in Qianhai set to debut in the middle of December.

 

The company earlier issued a profit warning stating that its net profit for the first half of the current financial year is likely to slide over 50 percent.

 

[Chinese version中文版]

 

– Contact us at [email protected]

 

VW/DY/

 

 

Hong Kong Economic Journal

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