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Rich pay, rich clients, but luxury retail jobs go begging

Surge in new hotels and shopping centres to cater to rising number of mainland tourists is stretching staff recruitment in the luxury sector

PUBLISHED : Friday, 09 May, 2014, 11:10am
UPDATED : Saturday, 10 May, 2014, 4:16am

Working on the sales floor for the likes of Burberry or Celine, surrounded by the latest season's outfits and HK$60,000 must-have handbags, may appear glamorous - but in Hong Kong even the world's most famous fashion houses are struggling to recruit and retain retail staff.

Despite enticing pay cheques, with junior sales associates earning as much as HK$50,000 a month, working in retail is viewed as a young person's game, with little prestige, difficult clientele and shift work.

Meanwhile, the demand for luxury goods from mainland shoppers over the past decade has simply outstripped the local retail talent pool.

"If you add up all the new hotels and the new shopping malls in the past few years, you realise that there is a huge increase, and it's pretty obvious that you're going to have a shortage," said J.B Aloy, an employee research veteran with market research firm Ipsos.

Based on government projections of the number of tourists in the next few years, "this is just going to get worse", Aloy said.

Hays recruitment consultant Eddie Chui, who specialises in hiring managers for luxury stores, said most major luxury brands faced the same problem.

"Matching [candidates with a company] isn't the most difficult; rather it's that [the job seekers] have too many options," Chui said.

It’s pretty obvious that you’re going to have a shortage [of retail staff]
J.B. ALOY, IPSOS

The average turnover period for retail staff in Hong Kong was 18 months to two years, he said, and most were in their 20s or early 30s.

Part of the problem, Chui said, was that retailing was not perceived as a serious career but rather a side job for students or a source of quick money.

"A lot of people want to get into this industry because they hear from family and friends it's easy to make money," JAC luxury recruitment specialist Viola Zhang said.

She said most fresh university graduates earned between HK$10,000 to HK$12,000 a month in other industries. However, someone in a junior sales position, which does not require a degree, at a luxury brand could earn HK$10,000 a month in commission alone - and double or triple that during peak season shopping periods.

"If it's Christmas time or Chinese New Year at Harbour City, with commission you can be earning HK$40,000 to HK$50,000 a month, even as a junior sales associate," Zhang said.

"If you have communication skills, a kind attitude and you're pretty, it's easy to step in."

However, it is just as easy to jump to another company that offers a slight bump in pay or to exit the retail world to find "a real career", resulting in a high attrition rate.

At the store manager level, recruitment proves even tougher, despite incomes as high as HK$70,000 a month. Luxury brands are looking for a certain "look" that projects the exclusive image of the brand and exudes a certain je ne sais quoi.

"How many people do you see on a daily basis who are trilingual and are also well-groomed?" Chui said.

"For a company like Prada, the store manager should be aged around 30 and ideally have a university degree, trilingual fluency and already have around six years of store management experience. Another key thing would be to have his own network of VIPs."

Chui said companies usually end up forgoing one of these traits.

"Luxury retail is quite challenging for staff," Aloy said. "They have to deal with a diverse client base, and this is partly unique to Hong Kong as well.

"There are lots of mainland Chinese tourists obviously, but we should never disregard Hong Kong clients plus other international tourists and the expat community as well."

As mainland customers become more discerning, the bar for customer service is also being raised, particularly when it comes to language skills.

According to a joint study by Ipsos and public relations firm Ruder Finn in November, the top expectation of mainland consumers was that luxury sales staff abroad should be able to speak to them in their own language.

But even when companies find a candidate with the right look and skill set, the high demands of the job can prove to be a turn-off.

While staff at a Dior store in Beverly Hills might help a dozen customers a day, it is quite another thing working on Canton Road, Tsim Sha Tsui, where lines often form outside the boutiques.

A regional managing director for a European luxury house said one of the drawbacks in working in luxury retail was the shift work, even at mid-management level.

There was also the perception that the subservient nature of the position made it less prestigious than an office job, even when you were managing a multimillion-dollar business.

The unacceptable behaviour of some mainland shoppers could also be frustrating to deal with, especially considering that staff were taught that the customer is always right.

He recounted the story of one male shopper from the mainland who decided to use the changing room as a toilet.

"He'd gone to the bathroom in the changing room because he decided it was too much of an effort to walk to the bathroom. He'd gone on the wall," the manager said. "We only found out after he'd left the store.

"Though that is an extreme, it's an example of the obnoxious behaviour of which there are countless stories. They are people who come from nothing to something very quickly. They watch these gangster movies and think this is how they should act."

So how should companies tackle the talent shortage?

"Obviously, have above-market benefits, not necessarily the base salary but providing them with training for multiple stores," Chui said.

"For example, if Burberry has a really good store manager, they might give them area management training, because, in general, they want multiple unit exposure," he said. That could eventually lead to international assignments.

Chui also encourages firms to always provide clear visibility of career progression paths within the company.

But there's only so much companies can do by themselves. Chui said the answer should be an industry-wide and government-sponsored approach. "It requires a lot of planning," he said, adding that the industry as a whole needs to think ahead five to 10 years.

"They need to develop a positive image for the entire industry, not just a couple of employers trying to do that."

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