Sa Sa suffers as Hongkongers tighten purse strings
Sa Sa International sales slipped 2.2 per cent in the latest quarter, with same-store sales in Hong Kong and Macau down 3.7 per cent.
The company says that while the transaction volume of mainland tourists rose 5.8 per cent in the three months to December 31, transactions by locals fell 5.2 per cent. However the average sale to tourists fell by 6.1 per cent and just 0.2 per cent to locals.
Sa Sa International’s retail and wholesale turnover in markets outside Hong Kong and Macau (including Mainland China, Singapore, Malaysia and e-commerce) increased by 1.3 per cent in the third quarter.
“[Hong Kong] consumer sentiment remained sluggish due to the weaknesses in RMB exchange rate and stock market under the continued shadow of the Sino-US trade war,” said chairman and CEO Simon Kwok in a stock exchange filing.
“In addition, the new e-commerce law passed by the Chinese government in August came into force early this year and made daigou traders more cautious in running their businesses. The group’s sales performance was affected and negative growth was recorded in both retail sales and same store sales in the Hong Kong and Macau markets in November and December.”
Kwok said that since the launch of the Hong Kong section of the Express Railway Link, the Group’s SaSa stores located in the Hong Kong West Kowloon station and the neighbouring Tsim Sha Tsui district have been reporting satisfactory sales performance. However, the increased influx of mainland tourists via the new Hong Kong-Zhuhai-Macau Bridge were mainly sightseeing trippers with limited purchasing power and barely contributed to the group’s overall sales in Hong Kong.
“Nevertheless, the group believes the two mega infrastructure projects will attract more mainland travellers with higher consumption when they are gradually consummated. The group remains optimistic towards the outlook of Hong Kong and Macau markets in the middle to long run under the favourable development of the Greater Bay Area.”
Kwok said Sa Sa International will strengthen promotional efforts to boost traffic and sales in physical stores to offset a decline in the online-driven daigou business.
“Digitalisation and information technology enhancement will be sped up to improve operational efficiency and shopping experience. In addition, the group will seize the opportunities brought by the Greater Bay Area to achieve sustainable business development for the group,” he said.