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Hong Kong's Retail Crisis Deepens: Uselect, CR Care, and Pricerite's Controversial Moves

2024-10-15 04:47:44.914000

In a significant blow to Hong Kong's retail landscape, Uselect, a supermarket chain, is winding down its operations amid a relentless retail slump. The company has announced closures for several locations by the end of October 2024, reducing its presence from around 100 locations last year to only 40 remaining stores [b118b0e8]. This decision follows the announcement by CR Care, another chain owned by China Resources Group, which will close all 19 of its stores in Hong Kong effective November 8, 2024. Both chains cite 'external uncertainties and various operational challenges' as key factors influencing their decisions [1d97302e].

The retail sector in Hong Kong has been struggling, with retail sales plummeting by 10.1% year-on-year in August 2024, totaling HK$29.2 billion (approximately US$3.8 billion). This marks the sixth consecutive month of decline, raising alarms about the future of retail businesses in the region [1d97302e]. Local residents have expressed a preference for supporting smaller shops despite these economic challenges, emphasizing the importance of community support for local businesses. Jenny Wong, a local retiree, highlighted how vital local supermarkets are to the community, while Hugo Tang Wai-yip, a staff member at Showa Film Camera, noted the strong community backing for local enterprises [b118b0e8].

Adding to the turmoil, Pricerite, a major furniture chain in Hong Kong, faced backlash for hinting at a possible closure as part of a marketing tactic for a price-cut campaign. The company posted on social media thanking customers and suggesting it was bidding farewell to old prices, which led to speculation about its shutdown. Signs at some branches read 'Today was the last day,' causing further confusion among shoppers [caee4dbe]. Pricerite announced a price reduction of over 7,500 products by an average of 23% starting at 9 am on Tuesday, but customers expressed anger on social media, criticizing the company for insensitivity during a time of economic downturn and numerous shop closures [caee4dbe].

As CR Care reported a decrease in the number of its retail pharmacies from 809 last year to 760 this year, the overall retail environment continues to deteriorate. Although the pharmaceutical retail segment saw a year-on-year increase of 9.3%, it accounted for only 3.9% of the total revenue of 128 billion yuan reported in the first half of 2024 [1d97302e]. The ongoing economic pressures, shifts in consumer behavior, and rising competition are contributing to the challenging landscape for retailers in Hong Kong, raising concerns about employment and service availability for residents [1d97302e].

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