Almost all retail categories suffered from double-digit decline from -10% to nearly -80%, except for a few including Fish, Livestock & Poultry, Fruits & Vegetables, and commodities in Supermarket.
Despite the traditional Lunar New Year festive shopping season, the average RSV of January and February still plunged -31.8%. In the immediate months ahead, the devastating situation of retail industry is expected to continue due to the lingering impact of the COVID-19 pandemic, which has caused the resumption of normal economic activities to be highly uncertain. Consequently, the Association maintains its forecast of a drop of RSV between -30% to -50% for the first half of 2020.
To gauge the latest impact of the unprecedented pandemic on our industry, the Association conducted a survey during 31 March to 9 April among our members and other retailers (“the Survey”). The survey findings reveal some alarming and worrying situations and trends which are much more devastating than those during the social unrest last year.
Based on our findings, we derived that some 10,400 retail employees might have lost / may lose their jobs between February and May; and around 15,200 retail stores, i.e., up to a quarter of Hong Kong's total retail shops, may collapse between May and December. The pessimistic projections would further fuel the increasing unemployment rate of our industry, which stood at 5.6% in the first quarter of 2020.
The Association welcomes the second batch of Anti-epidemic Fund announced by the Government on 8 April, which includes a wage subsidy of 50% of the monthly salary, up to HK$9,000. Further details of the scheme have yet to be announced, but our Association has already started to understand the mechanism and provide our feedback to the Government for practicality and effectiveness.
Although the Government’s wage subsidy and other support measures might help to slowdown business shutdowns and staff layoffs to a certain extent, the positive impact may not be sustainable if landlords do not support by granting necessary rental concession timely to their retail tenants. In this regard, the Association has been strongly urging landlords to charge turnover rent only without fixed rent or to offer not less than 50% of rental reduction, for a period of at least 6 months. Moreover, we publicly announced the top 5 developers ranked by the unreasonableness of rental concessions perceived by the respondents in the Survey on 21 April for reflecting the updated situation.
Nevertheless, the pandemic has not halted the Association’s unwavering effort in promoting e-Commerce and online opportunities to our members. In this current issue of E-Newsletter, we put special emphasis on Smart Retail focusing on cross-border retailing and mobile payments. To overcome the impact of social distancing, the Association has been organizing webinar talks and seminars on topics that help members to cope with the pandemic and its impact.
In particular, we are partnering with Facebook to launch an online education series starting from 16 April, with an aim to provide online resources for businesses to grow and acquire digital skills. At the same time, we keep up with our momentum in connecting our members with outstanding e-shop developers and e-platforms to improve their business during hard times. Our newly introduced Quality E-shop Developer Recognition Scheme is an effective platform for e-shop developers to increase their exposure to retailers in Hong Kong.
Last but not least, I would like to take this opportunity to welcome all recently joined new members. I am grateful to see retailers being united by becoming our family members despite the deep uncertainty ahead. With courage and faith, let us move forward and face all kinds of challenges together.
