Hong Kong’s retail sales has seen a 4.1% YOY downturn as of May 2014, the third consecutive month of sales shrink as jewellery sector sales prominently drops.
Despite the drop, the report shows the sales downturn has seen an improvement comparing April’s 9.9% slump in value and 9.6% in volume.
The paper shows retail sales registered a mild decrease of 0.2% in value in the first five months but seeing a slight slip of 0.1% in volume over the same period of last year.
Jewellery sector sees the most significant drop in both sales value (-24.5%) and volume (-22.7%).
Victoria Lai, marketing director at King Fook Holdings, said anti-corruption measures in China has great impact on “gifting luxury” and watches bear the brunt.
“As the high end jewelry and watch retail, King Fook has been suffering with rental surge for prime location shops, coupled with brands compete for larger space in shop or request for mono brand pavilion results in shop floor expansion. All these are unfavorable factors for retailer,” she told Marketing.
The category of “Electronic goods and photographic equipment” also recorded a significant drop (-14.3% in value and -8.6% in volume), followed by another tourist-depended category “Other consumer durable goods, not elsewhere classified” (-7.8% in value and -1.3% in volume).
Vincent Cheung, senior director and general manager of consumer imaging and information group at Canon, said the notable drop was mainly due to shrunk purchase power of mainlanders.
“The number of mainland tourists has been slightly dropped and average spending per head is also reduced.
“Beside the mainland tourists, spending power of local consumption is still strong but the uncertain economic outlook in first half has affected their confidence.”
He said the high blooming stage of photo equipment market has already passed.
“In fact, low-end compact camera is declining but high-end compact and DSLR are still selling very well,” he added.
Eric Cheuk, retail management supervisor at LG Electronics Hong Kong, said heightened political tension is also an influential factor.
“During the pro-democracy march on 1 July our retail sales on the island side dropped. Social movement is indeed affecting consumers’ purchase intention,” he said.