Source:
https://scmp.com/article/413983/crisis-hit-shops-hold-earliest-summer-sales

Crisis-hit shops hold earliest summer sales

The Sars outbreak has forced retailers to hold the earliest ever spring and summer sales in Hong Kong.

To cope with the decrease in sales, fashion companies have come up with aggressive discount promotions as a quick way to attract customers.

Retailers such as Joyce, Seibu and Swank are already offering 20 to 50 per cent discounts on selected merchandise, while contemporary wear boutique I.T. has introduced a coupon scheme that entitles shoppers to two $1,000 cash coupons redeemable upon future visits for every $2,000 spent.

Nelson Chan, menswear buyer at Swank, said the spring season usually started in February when new merchandise arrived in the stores.

'We are looking at an unprecedented season this year, with companies already offering up to 50 per cent discount,' he said. 'The crisis that we are looking at this season has never happened before.'

In the fashion sector, high-end luxury conglomerates such as LVMH and Gucci have predicted a decline in sales; casual-wear retail giants such as Giordano and Esprit have announced a 25 to 35 per cent plunge in sales since the outbreak.

'All retailers are suffering, with sales dropping by 25 to 40 per cent in general for low-end markets,' said one business analyst at a leading brokerage and investment banking company in Hong Kong.

Mr Chan said he believed buyers might revise their autumn/winter purchasing plans if the situation did not improve in the next few months. Such measures may include cancelling orders, renegotiating terms with principal vendors and turning away late deliveries of merchandise.

Mr Chan predicted most stores would extend sales longer than those following the Asian economic crisis in 1998, when sales began as early as May and lasted until September.

'The damage done by Sars is irreversible, so the foremost concern right now is to get rid of as much stock as possible,' he said.