Hong Kong retailers Sa Sa and TSL Jewellery shift focus to e-commerce, mainland China to survive coronavirus pandemic

Name: Why live streaming is becoming China’s most-profitable form of electronic media
Uploaded: 2020-11-19T11:43:42.000Z
Duration: 4 min 33 s
Description: Why live streaming is becoming China’s most-profitable form of electronic media

To grow its flagging sales, Sa Sa has tapped e-commerce platforms and plans to use WeChat mini-program to interact with mainland customers

TSL makes greater use of online channels, sets up live streams to interact with younger consumers and boosts cooperation with Chinese influencers

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Sa Sa reported a loss of HK$242 million for the six months ended September, compared to HK$36.5 million a year ago. Photo: Xiaomei Chen

Lam Ka-sing

Published: 7:43pm, 19 Nov 2020Updated: 7:44pm, 19 Nov 2020

With the coronavirus pandemic and recession deepening the sales slump, leading Hong Kong retailers are adapting to the new normal by seeking growth in mainland China and via online channels while closing stores and pursuing bigger rent concessions.

“Covid-19 has brought enormous challenges and evolution to the entire retail industry as well as to Sa Sa,” Simon Kwok, chairman and chief executive of Sa Sa International Holdings, said on Thursday after the cosmetics retailer posted deeper losses. “[With] the gradual shifting of consumption patterns from traditional retail channels to online platforms, the group is determined to stride into the new retail era and reduce its reliance on physical stores.”

Sa Sa reported a loss of HK$242 million (US$31.22 million) for the six months ended September, compared to HK$36.5 million a year ago, according to an exchange filing. In a bid to cut costs, the company cut the number of retail outlets to 231 at the end of September from 244 last year.

To grow its flagging sales, the company said that it has undertaken many marketing initiatives in Hong Kong, tapped e-commerce platforms and plans to use the WeChat mini-program to interact with mainland customers.

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Why live streaming is becoming China’s most-profitable form of electronic media

Kwok said as sales on the mainland had shown an improvement recently, the company planned to open six to 10 more outlets in China in the current financial year.

However, he did not maintain the same level of enthusiasm for Hong Kong after sales in the city and Macau fell 70.4 per cent to HK$856 million in the six months to September as the pandemic shut off tourists from the city. “In the coming few months, if the operating environment of physical stores does not quickly turn around, we will proactively close shops with high rents to cut rental costs,” Kwok said.

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