Firms shouldn't look down on Hong Kong consumers

PUBLISHED : Wednesday, 18 January, 2012, 12:00am
UPDATED : Wednesday, 18 January, 2012, 12:00am


Despite the dreary weather, dozens of local citizens gathered on Sunday outside a Dolce & Gabbana store in Tsim Sha Tsui for the third time, protesting against the Italian clothing shop's alleged discrimination against Hongkongers.

The protesters claim the store had stopped a Hongkonger from taking photographs of its shopfront while allowing mainlanders and foreigners to do so. It seems that if D&G insists on remaining silent on the issue, rather than apologising, the rallies will continue.

Last year, shortly before the implementation of the minimum wage law, the Cafe de Coral fast-food chain sparked a citywide call for a boycott after its chairman Michael Chan Yue-kwong said his company would stop giving employees paid meal breaks to cut costs. The boycott was eventually called off after the firm backed down.

The company has again been in the news in recent weeks, when Chan announced it would raise prices in response to inflation and the rising wage costs. Chan said the economic downturn might benefit the fast-food industry, but he expected costs to continue to rise this year.

He also said Cafe de Coral is seen as a middle-class restaurant on the mainland, and thus customers there are more willing to accept price rises. The average mainland Cafe de Coral customer now spends around 26 yuan (HK$32) per visit and he expects prices to be raised by 8per cent in total across its mainland branches this year.

In other words, he was implying that it was tough doing business in Hong Kong because, on the one hand, workers were demanding better pay but, on the other, customers were refusing to pay more. His underlying message was that mainlanders were more understanding than Hongkongers.

We should not forget that rising overheads is one consideration when it comes to raising prices, but it is not the only factor. Chan shouldn't have tried to put down Hong Kong people by implying that local citizens have less purchasing power than their mainland counterparts. This kind of insensitive sarcasm will do no good and could spark widespread public outrage again.

Such incidents show big corporations seem happy to ignore public sentiment at the best of times. But, by doing so, they risk damaging their corporate image, whether or not they are aware of it.

Over the past few years, the mainland's economic growth has been meteoric, rapidly raising people's income and purchasing power. As a result, mainlanders are naturally more tolerant of price rises, or maybe they have become numb to constant price increases.

Their situation is similar to that of Hong Kong in the 1980s when the city experienced remarkably high growth and rapid development, and salaries were raised by at least 10per cent every year. And despite rising rents and inflated property prices, people had no complaints because they had become used to the situation.

However, it's a different picture these days and Hong Kong's growth is not so impressive. The city is plagued by a widening wealth gap, the problems of the working poor, plus many other socio-economic troubles that refuse to go away.

Against this backdrop, it's difficult to understand why Chan can't feel the pain of the people. His actions will further reinforce the negative image people have of big corporations, and polarise the community.

If Cafe de Coral wants to develop its profitable market on the mainland by opening 30 restaurants there every year, so be it. It's a sensible business decision. But it's certainly not sensible to treat the Hong Kong market with less respect. Until and unless the company does not want to do business in the city, it has to act responsibly and respectfully. It's not just about preserving the company's image, but also about fulfilling its corporate social responsibility. Trust and credibility takes a lifetime to build, but only seconds to destroy.

Albert Cheng King-hon is a political commentator.