Consumption Vouchers Barely Make Dent in Sales

Consumption vouchers aren't benefiting small businesses

The HK$5,000 e-vouchers are supposed to inject a whopping HK$30 billion into Hong Kong's economy and aimed at benefiting small retailers, but some report only a small uptick in business.

In Kennedy Town, a small fashion boutique owner reported no difference in revenue, even though she signed up to use Octopus cards in her shop, as installation and transaction fees would be waived for the first six months. She plans to return the card terminal when the period waived is up.

People buy expensive items without voucher

"About 10 percent of my clients started using electronic payment methods, but revenue didn't actually increase," she said.

Another shop selling imported frozen food also in Kennedy Town saw a slight increase in sales when the e-vouchers first came out in August that later died down, and no increase in the second installment. 

"I didn't see them spend more than usual or buy more expensive things because of the consumption vouchers," Jimmy Tsoi said. "Younger people may save up [the installments] to buy something more expensive at once. It would feel better than using it to buy small items, or something for daily use."

But according to the Census and Statistics Department, overall sales jumped 11.9 percent in August compared to the same time last year. However August 2020 was before Hong Kong had vaccines and there were strict social-distancing measures in place at the time, thus sales were low then too, points out Annie Tse, chairperson of the Hong Kong Retail Management Association.

Sales in footwear saw a big increase year-on-year

Retailers selling footwear and clothing saw the biggest rebound compared to other types of businesses, recording a 62.3 percent year-on-year increase in August, while optical shops saw a 60.4 percent rise compared to the same period last year according to government statistics.

Nevertheless, restaurants in general are doing a healthy trade, though it doesn't have much to do with consumption vouchers, as it is the high-end restaurants that are busy these days with wealthy customers splashing out on fine dining meals that they would have spent on trips.

So while the Financial Secretary Paul Chan Mo-po intended the e-vouchers to help small businesses, his elaborate and grand plan barely made a dent.