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The View
Opinion
Richard Harris

The View | Why grocery shopping in Hong Kong is still a walk down the aisle of bad deals

Richard Harris says Hong Kong’s Competition Commission should be taking on the big players, such as chain stores where the high unit prices affect people’s daily lives

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A woman shops in a supermarket in Kowloon Bay on August 2. Photo: Roy Issa

It was hot. I swept into a convenience chain store desperate for a cold drink. A can of Coke at a whole HK$9? But I could get two cans for HK$11!

That looked like a deal until I realised that I had lost track of the unit price. HK$5.50 is 10 per cent more than the price of the same can in the rapidly disappearing family-run corner shops.

This reminded me of pioneering 759 grocery store entrepreneur, Coils Lam Wai-chun, who died last week. His independent discount chain tried to buck the system in 2011 by selling the same drink for just HK$2.70 per can, whereupon the supplier, Swire Coca-Cola Hong Kong, which had raised the wholesale price from HK$2 to HK$2.20, complained that 759’s price was too low. The supplier pushed up the price until 759 could not undercut the competition.
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I decided to conduct some research. It seems that the two-for-nearly-one gambit, elsewhere known as BOGOF, is a shopkeeper’s favourite. I found a bottle of wine at HK$96 and two of them at HK$98!

I took my analysis further by visiting one of our two dominant supermarket chains. It matters not which one; the prices are all eerily the same. There was the BOGOF offer: one red can of the sugar-laden drink at a mighty HK$7.5. At the back of the shop you could buy 12 cans for just HK$3.13 each. At a guess, stores can buy a can in at about the HK$2 mark, meaning around a 250 per cent margin on just this one low-ticket high-turnover item.

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Coils Lam Wai-chun, chairman and managing director of CEC International Holdings Limited, at a 759 store in Kwun Tong in July 2013. Lam, who died this month, gained attention for his battle to keep the prices in his stores low. Photo: Dickson Lee
Coils Lam Wai-chun, chairman and managing director of CEC International Holdings Limited, at a 759 store in Kwun Tong in July 2013. Lam, who died this month, gained attention for his battle to keep the prices in his stores low. Photo: Dickson Lee
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