The sector is poised for a rebound following a bullish global economic outlook.
Amidst a two-year downturn that has seen big brands like Ralph Lauren closing shop, Hong Kong’s battered retail sector is slowly recovering with positive expectations of sales growth between 4-6% equivalent to approximately $465b to 480b in 2018, according to a media release from PwC.
After two years of store consolidation and retreat from main street locations, the retail sector is finally facing better days ahead as PwC maintains its positive outlook for the next five years.
The initial numbers are also indicating good news as sales rose marginally by 1.8% YoY for the first eleven months of 2017 with luxury goods leading in overall retail sales.
“In addition, tourist arrival numbers in Hong Kong, particularly from China, have been encouraging and recovering steadily in 2017 under the much better and stabler political and social environment. Combined with low jobless rate and a recent weakening US Dollar against major currencies, Hong Kong’s retail sector should be recovering well in the medium term and exceed the all-time high in 2013 within the next 5 years,” said PwC Asia Pacific & Hong Kong/China Consumer Markets Leader Michael Cheng.
Retailers should also change their business models by leveraging technology and data to weather out the downturn and ensure long-term development.
“Retailers need to transform themselves: from being disrupted to be a disruptor. Embracing technology and data in order to provide unique customer experiences through diversified platforms and logistics networks are the keys to success,” added Cheng.
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