When Hong Kong’s Da Da Department Stores closed with ‘cut-throat’ clearance sale

“Store crash leaves staff locked out,” ran a South China Morning Post headline on March 13, 1986. “About 1,000 employees of the Da Da Department Stores group found themselves shut out when they arrived for work yesterday morning. The chain’s seven shops in Hongkong, Kowloon and the New Territories were closed after the group was placed under receivership on Tuesday by the Hongkong and Shanghai Banking Corp.”

It was not the first time Da Da had suffered financial woes. The company, which was established by the Hong Kong-based Young family in 1974 and gained popularity by offering 20 per cent discounts on Sundays, had been placed in receivership the previous July. That receivership was lifted after a “substantial” cash injection from the Young family and a restructuring of the company’s debt in August.

Da Da was less fortunate the second time. On March 25, 1986, the Post reported that employees “were told yesterday chances were slim that the chain would be handed back to the Yeung [sic] family to manage […] Their only hope now is that the chain will be bought by a third party”.

This was not to be the case, and on March 29, Da Da’s clearance sales began. “Several thousand anxious shoppers ripped apart an iron grille at the Mongkok branch of the troubled Da Da Department Store chain yesterday as they battled to snap up bargains at a cut-throat sale,” the Post reported.

The month-long sale “made a profit of more than $67 million”, according to a May 11 Post report, which allowed the group to pay off “more than 700 workers affected by the closure”.

Creditors, however, were not reimbursed and, on August 6, the Post reported a number of them had “separately begun legal actions [...] against Da Da, its directors and companies connected with them. Hongkong Bank has issued several writs seeking repayment of a total of about $70 million, while Chase Manhattan is suing to recover $16.2 million.”