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.

The Good News, Bad News

Many people took advantage of the opportunity to get the jab

 

This morning a lot of people in Hong Kong signed up for the vaccine online now that the government has allowed people from the age of 30 upwards to get it, as well as domestic helpers, and students 16 years and older who are studying overseas.

The process was relatively efficient, though if you spent time reading through all the precautionary measures and possible side effects, then you wasted precious time getting the dates and times you wanted.

Now people over 30 are eligible to get vaccinated

Nevertheless some of these people are getting the jab as early as this Friday and are only too excited, showing off their confirmation emails on social media.

Today there were 18 cases recorded, five imported, and five more added to the growing gym cluster to 127.

Yesterday University of Hong Kong microbiologist Ho Pak-leung complained that the government's LeaveHomeSafe app is not working effectively to notify people if they had been in the same place at the same time as an infected person.

"The 100 or so people must have gone out for dining in the past 10 days. We are not seeing there's any improvement in contact tracing on that front. Although many people have installed the LeaveHomeSafe, the app seems not to have fully shown its effectiveness," he said.

A friend told me her three colleagues went to the Grand Hyatt Hong Kong recently, one used the app, the other two wrote down the contact details. In the end it was the latter two who were notified by the hotel and not the one who used LeaveHomeSafe!

Leung said if there is a delay in tracking down people there could be more clusters forming from restaurants, which we have seen here and there, with places like Zuma, Somm, Mandarin Bar + Grill, Arabica and Tree House just to name a few.

Dr Ho worries tracing app is not effective enough

There is also the concern that new infections won't show up for about two weeks too.

The chance to get a vaccine can't come fast enough.

Meanwhile Hong Kong is facing its highest unemployment rate since 2004 at 7.2 percent. That means more than 261,000 people are out of a job, 8,300 more than before.

The sectors most affected are tourism, hospitality and retail, while the food and beverage area has improved slightly. 

Back in 2003 the jobless rate was 8.5 percent during SARS, but that was for about four or five months, compared to now being well over a year. 

If that wasn't bad enough news, the government has approved fare hikes for buses by as much as 12 percent.

With bus fares going up, will more take the tram?

This is hard to understand because during the pandemic last year till now the frequency of the buses have decreased significantly, making people wait longer for buses or they are more packed. 

Fares for Citybus and New World First Bus will go up 12 percent in two phases, one in April the next in January, while Kowloon Motor Bus can charge 8.5 percent more, and New Lantao Bus company can raise fares by 9.8 percent.

However Long Win Bus, which runs bus services to the airport will not see an increase in fares as the government believes travel will come back soon...

At the same time the government is increasing the public transport subsidy to HK$500 per person, up from the current HK$100 and as long as people spend at least HK$200 on public transport per month.

Maybe -- just maybe -- this may push some people to use the tram and the Star Ferry more often.

Or in my case, walk more.

HK Govt Blames Protests for High Poverty Rate

Law Chi-kwong says the poverty rate is lower than reported

 

Yesterday the government said Hong Kong's poverty rate reached a record high last year, and the protesters were to blame.

In its annual poverty report, the government said 21.4 percent of residents were considered poor last year, up one percentage point from the year before. It said 1.49 million of Hong Kong's total population of 7.52 million were under the poverty line -- which is calculated at 50 percent of the median monthly household income before government allowances and subsidies.

The median monthly household income in 2019 was HK$28,900, which is difficult for a family to live on, and half that at HK$14,450, even worse.

Govt report says 1.49m are below the poverty line

Nevertheless, the government had the gall to blame the situation of the poor on the anti-government protests last year and the trade war between China and the United States, saying the "double whammy" caused the SAR's first economic recession in a decade.

"The unrest caused severe disruptions and battered sectors related to consumption and tourism that involved substantial lower-skilled jobs. Grassroots families were particularly hard-hit," it said, adding that the labour market worsened in the second half of 2019.

How can the government blame poverty on the protesters, when it was the government that came up with the extradition bill in the first place and refused to listen to 2 million people protesting against it that caused the months-long protests that rocked the city? 

And in any event, why does the government even allow employers to pay its workers such low wages to start with? It is the government itself that does not value these grassroots families to start with.

Perhaps after receiving a lot of heat for this weak explanation of why there are so many people in Hong Kong, the Secretary for Labour and Welfare Law Chi-kwong hit back, and began interpreting the numbers differently.

On a radio show today he claimed it was wrong to extrapolate there were 21.4 percent of people living below the poverty line in Hong Kong, based on the report his administration published.

Critics say report only tells half the story

"It doesn't tell us how many people are actually living below the poverty line. It tells us how many people would be living in poverty if the government does nothing at all," Law said.

He explained that after factoring in various social security allowances and government relief subsidies, the poverty rate was only 9.2 percent, or 640,000 people. That meant the so-called post-intervention poverty rate marginally improved by 0.1 percentage points from 9.3 percent in 2018, he said.

Law added the efficiency of the government's social welfare programs helped 850,000 residents out of poverty through Comprehensive Social Security Assistance, and Old Age Living Allowance.

However, in many cases the government makes it very difficult to be eligible for CSSA, and the allowance for seniors is a very small sum each month, less than HK$1,500.

Ng Wai-tung, community organizer for the Society for Community Organization, said the welfare chief's analysis also did not reflect the whole picture.

"It's only half correct," Ng said. "On the one hand, it reflects the scale of low-income groups before any government assistance, but on the other hand, it underestimates the harsh reality that so many people are not even earning enough to make ends meet."

White elephant projects like Kai Tak waste money

Perhaps one thing Law and Ng can agree on is that the poverty rate could climb higher next year due to the coronavirus pandemic that greatly impacted areas such as tourism, hospitality, retail and construction.

Law said the government has already rolled out multiple poverty-alleviation schemes this year.

While the effort is appreciated, the government's investment in the poor is pittance compared to how much it throws into white elephant projects like the Hong Kong-Zhuhai-Macau Bridge, the Kai Tak Cruise Terminal, and Disneyland.

If the government put more effort into really helping the poor, it would benefit Hong Kong's economy even more. Social mobility is what makes an economy stronger and gives hope to people.

But it seems the Lam administration is keen on blaming others for high poverty rates, when it is those in the position in power who have caused this problem of inequality in the first place.

 

Pandemic Hits Poor the Hardest

There are more unemployed among the working poor than other Hongkongers

It is devastating how the coronavirus pandemic has severely impacted the worldwide economy, and Hong Kong is no exception.

Today there was a news report on the exhibitions industry, that 50 exhibitions and conferences were cancelled this year so far that would have drawn 54,000 exhibitors and 3.4 million visitors.

Last year some 1.69 million people came to Hong Kong for MICE events (meetings, incentives, conventions and exhibitions), which made up of 55 percent of the total business visitors according to the Hong Kong Tourism Board.

SoCO released its survey on low-income workers today

That has a knock-on effect on hotels, restaurants and shops in the city.

There are about 600 firms related to exhibitions in Hong Kong, all paying rent on warehouse space, and staff, and many sitting on lots of product that they need to sell, not to mention the hundreds of casual staff without work.

Others being hit very hard by the pandemic are the working poor. Their unemployment rate is eight times higher than the city's unemployment rate, and more than one-third do not get government subsidies because they find it too cumbersome to get through all the bureaucratic red tape.

The Society for Community Organization (SoCO) conducted a survey of more than 330 low-income residents and found 31.5 percent had lost their jobs between May and July, and 28 percent had not worked for an entire year.

Seventy-five percent of those surveyed had been unemployed for those three months, and 10 percent were behind on rent. 

Many found it too troublesome to apply for subsidies

Hong Kong's unemployment rate for the same period was 6.1 percent.

"The city's low-income residents are living in a disaster zone compared to other people," said SoCO community organizer Sze Lai-shan. "For those who have been unemployed for months, they are having to eat less or even take out loans.

"The government has been giving out subsidies, but the poorest among us are not getting a single cent."

Some of those interviewed complained they weren't able to reach officials from the social welfare department for help because many government staff are working from home during the pandemic.

Things are getting really desperate for these people who wonder how they are going to survive the next few days let alone the next month.

Has the government forgotten about them?

Or are they expected to follow Chief Secretary Matthew Cheung Kin-chung's advice to get a job washing dishes?

Retail Sector Continues to Sink

Shopping malls are practically empty, hitting the retail industry hard

Today Hong Kong reported just one new positive case of the coronavirus, and at the press conference this afternoon, reporters asked Dr Chuang Shuk-kwan, head of the communicable disease branch of the Centre for Health Protection if this signaled the start of the government possibly lifting the restrictions on gatherings and 50 percent capacity in restaurants and so on.

However Chuang again repeated her mantra that it was still too early to tell, that Hong Kong also had to consider the global situation, which she said was still not good, and also because the virus can be carried by asymptomatic people, it was best to still maintain social distancing, wear masks in public places and maintain good hygiene.

Dr Chuang says social distancing needs to continue

She is probably still waiting until at least over a week from now after the Easter holidays to see if there are any cases that are reported locally after many people gathered in beaches and hiking trails.

While the one new case is positive news for Hong Kong, there is a dire announcement from the retail sector, that some 10,400 workers will lose their jobs and 5,200 stores will close by the end of May, and probably even more will be shuttered later in the year.

The Hong Kong Retail Management Association released these statistics after surveying 152 firms that operate 3,345 stores and employ about 23 percent of the sector's workforce.

Association chairwoman Annie Tse Yau On-yee said 96 percent of the companies suffered losses during the pandemic, and the latest HK$137.5 billion government relief package would only delay the rise in the unemployment numbers.

Most people are staying at home to avoid possible infection

Companies could not benefit from the scheme of the government subsidizing employees' wages if shops were going to close.

She warned if the pandemic continued and there weren't enough relief measures, another 2 percent of employees, or 5,200 people in the companies it interviewed could expect to lose their jobs in May.

Also in the survey, more than half the respondents said rent cuts would be most helpful, though more than 84 percent said the reductions were not enough.

The survey revealed no landlords had heeded the association's call to charge rent based on business' turnover or offer rent relief for May and June.

Wonder if many of these landlords mentioned in this survey are the big tycoons who seem to think business is business and renters have an obligation to pay their monthly dues despite a global pandemic that is beyond anyone's control.

If the pandemic continues, more shops will close for good

Hong Kong has managed (so far) to flatten its curve significantly to single digits, but that's because a lot of people are not out shopping, nor do they have the appetite to do so with looming pay cuts or even job losses.

As a result that has impacted the retail industry profoundly, and if landlords want to continue having shop spaces occupied, then they have to step up and shoulder the burden too. They, particularly the tycoons, and large corporations, have the resources to ride out this unprecedented crisis.

How about giving back to the community to keep the economy going? Otherwise there is going to be a lot more empty shop spaces in Hong Kong than ever before.

Hong Kong's Next Crisis: Unemployment

A mask-wearing father carrying his child in a pretty empty MTR train

As of today there are just over 2,000 deaths from the coronavirus, over 75,200 confirmed cases. Hong Kong recorded its second death today, a 70-year-old who visited the mainland for a day and then came back with symptoms later. He also had existing health conditions.

A big concern now is the economic fallout from the Wuhan coronavirus -- and it's going to be huge just in Hong Kong alone.

Hong Kong Airlines cutting costs and staff to stay alive

Cathay Pacific has had to cut back its capacity by 40 percent, meaning lots of flight crews, engineers and catering don't have much to do and have been asked to take unpaid leave. They even closed their first class and business lounges in the airport since hardly anyone is flying these days.

Today Hong Kong Airlines laid off 170 staff, which a reporter pointed out, was more than the number of passengers who flew on the airline today.

And in order to survive this crisis, Hong Kong Airlines has stopped all in-flight entertainment, meals, drinks and even blankets to cut costs.

The remaining staff (around 3,300), are taking no-pay leave from mid-February until the end of June, which is the equivalent of working part-time on half their salary for the next two months.

Cathay Pacific has had to cut flights, staff take unpaid leave

An ex-colleague contacted me last night asking if I knew of any freelance work available. The company he works for has notified staff that they will have to take no-pay leave for four months starting next week. For younger workers who don't have much saved up, or those with debt or other obligations, that's a big financial hit.

Meanwhile hotels are operating on a dire existence. The Federation of Hong Kong Hotel Owners, which has 86 owners running 200 hotels that employ 80,000 workers said today that occupancy percentage levels are in the single digits.

"So few rooms are taken up that our members no longer gauge occupancy by percentage, but by room numbers, said Michael Li Hon-shing, executive director of the federation.

"Now, many full-time hotel staff are taking no-pay leave. I would not be surprised to see businesses closing down next. February and March will be the critical period for their life and death."

Hotel occupancy is in the single digits all over town

Tourism contributed 4.5 percent to Hong Kong's GDP in 2018. Surely this year it's going to be down in the dumps, as there are only some 3,000 people arriving in the city daily, compared to 100,000 last month, and 200,000 in February last year.

Yesterday the Hong Kong Tourism Board said COVID-19 is worse than SARS 17 years ago, when there was an average of 10,000 visitors daily and hotel occupancy was in the double digits.

This time a lot of airline carriers have suspended flights to Hong Kong, and even immigration at Shun Tak ferry terminal, Lo Wu and Lok Ma Chau have stopped, resulting in drastically fewer visitors coming in.

That means less travelers injecting money into the local economy, in particular retail, and on top of that locals are too scared to dine out, resulting in restaurants and bars being very quiet. Even taxis are easy to flag down these days.

Shopping malls are pretty empty, retail taking a big hit

The only places that are busy are supermarkets and pharmacies to get essentials like masks, rice and toilet paper.

That said, today I noticed more people going to work, or going out in general on the MTR and the bus. They are tired of being cooped up in their flats and want a change of scenery. Or maybe their bosses have had enough of the work-at-home measure that has resulted in terrible productivity levels (what have you been watching on Netflix?).

While the government has suggested civil service staff work from home until February 23, we will find out soon if it will extend it for another week or ask more staff to come back to the office.

However, we are no where near containing the coronavirus to the point where the numbers are plateauing yet. It is considered highly contagious as demonstrated from the statistics and the links between some of the cases.

There may be a lot more restaurant closings in Hong Kong

Regardless, in the end, the economic cost of this virus will hurt a lot of people in Hong Kong, from layoffs to pay cuts. Will the city be able to rebuild itself again after this? It will take sheer determination, creativity and resourcefulness. As demonstrated the government has no leadership in this crisis. We're going to have to do this on our own.

香港人加油!!!!

Fact of the Day: Hongkongers are Overworked

Hongkongers are some of the most overworked people in the world

A study released today has found one in five employees work an average of 11 hours a day, with security guards working the most.

The Hong Kong Confederation of Trade Unions analyzed the latest labour data from the Census and Statistics Department and found 20 percent of the city's 3 million employees worked an average of 55 hours per week last year, or an average of 11 hours a day for a five-day work week.

Half of food and drink employees work 56 hours a week

"Hong Kong employees have been working super long hours for years," says Mung Siu-tat, chief executive of the confederation. "This is because the government has never taken any concrete measures to ease this problem, which has been harming workers' family well-being, health and even lives."

People who work in security, food and drink, land transport, construction and retail industries have the longest working hours.

Almost half of security guards work 56 hours a week, a quarter of them work a staggering 72 hours. Also almost half of food and drink employees work 56 hours a week, along with one-quarter of land transport workers, 16 percent of construction workers and 16 percent of retail employees.

On top of that their salaries hardly compensate for the hours worked -- entry- and mid-level employees saw an average growth in their salaries of just 0.7 percent between 2008 to 2018 -- after taking into account inflation rates, while gross domestic product per capita rose annually by 2 percent.

"This shows that even though employees work so hard, they cannot get reasonable returns," Mung says.

Many security guards work 12 hours shifts, six days a week

While the government set up a Standard Working Hours Committee in 2013, it was only two years ago that the committee recommended the government require employers to establish agreements with entry-level employees about working hours and overtime compensation arrangements.

But the government has so far only promised to introduce working hours guidelines in 11 industries, with no plans announced yet to legislate standard working hours.

This shows the government doesn't care about the city's 3 million workers, the ones who keep Hong Kong's capitalistic characteristics functioning, whether it be feeding people, selling customers products, or making sure a property is safe from intruders.

Instead it's all about helping companies squeeze out as much labour as they can from their staff to ensure a profitable bottom line. If they're burned out, just hire the next person.

In 2016 financial services firm UBS released a study of working hours among 71 world cities and found Hong Kong workers had the longest.

Is this something we really want to brag about?

Late NIght Shopping

There's a lot of people out shopping in Causeway Bay for Christmas

This evening after work I headed out to do some Christmas shopping in Causeway Bay.

I prefer shopping in the evenings because in general there are fewer people in the stores, though with Christmas less than two weeks away there were quite a lot of people with the same idea.

When I headed to Sogo department store there were fewer and fewer people the higher up the floors I went, which was a good thing. In the kids' section there were discounts, but for shops like Ferrari, Kenzo, Gucci and Paul Smith -- since when did he do kids' clothes, the prices were over HK$1,000.

Cute Paul Smith clothes for kids that I want to wear!

And Gucci even had those loafers lined with fake fur... really? At that age?

I went to one boutique for adult sportswear and was interested in buying some items when I looked at the time and it was 10.10pm.

I apologized to the saleswoman for keeping her late.

"Oh don't worry about it. We're open until 11.30pm today," she replied, explaining if Sogo wants to be open until 11.30pm, all the shops inside must stay open too.

I was shocked. "Who actually buys things at 11.30pm?" I asked incredulously.

Check out these Gucci loafers with fake fur

She replied she didn't know, but perhaps she wanted to prevent herself from complaining.

However, she did let it slip that from December 22-24 they would be open until midnight.

"Midnight!" I gasped. "Are there really people buying at that time?"

Again she and her colleague held back from giving their opinion on the matter. They had a job to do, and it was for however long they were expected to work.

So when you go shopping this holiday season, think of all the sales people who have to stand around until the wee hours to serve you. They deserve a break too.

Shopping Dead Zone

Build and they don't come -- empty stalls and no shoppers at The Boxes

 What a disaster.

A few years ago when local residents were complaining about mainlanders crossing the border and snapping up all kinds of things from baby milk powder to cosmetics, clothing and handbags in shopping malls in Hong Kong, there was an idea to prevent them from coming into town and shop right at the border.

This way some entrepreneurs could make some money, and the shoppers could save time coming into town to get what they needed.

However, San Tin Shopping City -- also called The Boxes -- for the container-style shops -- didn't finally launch until this February and the tenants there have been losing lots of money ever since.

The site where San Tin Shopping City is located

Project advocate and lawmaker Wong Ting-kwong, who represents the import/export sector, admitted business at The Boxes was stagnant, with losses of HK$2 million a month -- or HK$18 million in total in the past nine months.

Business is also slow because some tenants haven't even opened for business yet and may not even bother, as the mall is seeking a three-year renewal from the Town Planning Board, which will be made on Friday.

Wong says currently only 47 tenants had signed contracts with the mall, which has 216 shop lots, and only 27 shops had opened their doors due to uncertainty of the temporary land-use permit, which will expire on September 16.

As a result tenants' rents we waived until this month, hence the HK$18 million loss.

On a recent weekday, only a handful of places were open. One of the tenants, Mrs Liu of Lan Hang Kitchen said they were told some 200 coaches would come here, but this transportation arrangement was never made.

"Honestly, we are disappointed, she said. "We have spent a few hundred thousand dollars on the facilities and decorations based on the belief the mall would attract at least 5,000 visitors a day. But it didn't happen."

Mainlanders want to shop in malls like these, not containers

To save money, Liu has been handling the business by herself.

"At the worst times, there is zero business, a situation we often come across. A few days ago I only sold one can of coke worth HK$8," she said.

Hardly a good situation. Wong will be getting a lot of heat for this disastrous attempt at diverting mainlanders to an open air space filled with container-like shops. Who wants to shop in a place like that?

There are so many convenient transport links to get people into town that San Tin Shopping City is a joke.

Anyone else have other brilliant ideas?

Where's the Hope?

Many young people are stuck in retail jobs, like the ones in Sogo

Last night I had dinner with some friends and talked about a perennial hot button issue -- housing prices.

One has been keeping track of her home evaluation and while she's pleased to see the price of her flat increasing quickly, at the same time she is dismayed that buying a home is even more impossible for young people in Hong Kong.

Most customers are mainlanders, but are we catering to them?

I had that in mind after dinner I went to the Sogo department store to see what I could buy for myself for Chinese New Year. The place wasn't very busy, with shoppers split between mainlanders and locals, the majority the former.

At one shop space selling sneakers, I was mortified to hear the young female shop assistant's Mandarin was atrocious. It was more Cantonese than Mandarin. Another shoe shop was the same. Another spoke in a tone that was laced with condescension.

Were they high school dropouts? Or they were unable to get into university? It was hard for me to tell, but on the whole most shop assistants' Mandarin skills were not good. Not only that, but their attitude towards their job was hardly enthusiastic.

Young people can't even afford one of these flats in the city

I know retail is not a career path many people aspire to, but surely it would be a motivator to find a way to get out? Or are they resigned to the possibility that this is their job forever? There wasn't any interest in trying to be a cheerful person, nor trying to improve their Mandarin skills.

Is this the generation the Hong Kong government claims it wants to foster? If so it's no wonder mainlanders feel a sense of ambivalence in the city; they want to enjoy it, and yet they are not welcome.

Why?

Preventing Agnes Chow Ting from running in the by-election, scorning the nomination of Joshua Wong Chi-fung, Nathan Law Kwun-chung and Alex Chow Yong-kang and the Umbrella Movement for the Nobel Peace Prize, and making no efforts to rein in housing prices and creating more job opportunities for young people shows the government doesn't care about the next generation.

The rift between young people and government grows wider

My friend pointed out the government has been pushing for closer links to China, which has resulted in young people retaliating by becoming "localists", focusing more on Cantonese -- which has resulted in English being left by the wayside.

How can Hong Kong call itself international anymore?

Beijing and the Hong Kong government have a lot to do to heal the rift -- they are the ones who have the power to change things for the better. Giving people hope makes the world go round instead of now, stagnant and bitter.

The A&F Party is Over

The A&F boys whipped up a lot of attention in the city in 2011

We're actually surprised Abercrombie & Fitch lasted this long in Hong Kong.

After a splashy opening that included topless men in red shorts riding in an open-deck bus and greeting customers at the Pedder Street store in 2011, the casual American wear brand will close its doors early next year.

The male models drew lots of customers into the store

It is breaking its lease that was supposed to expire in 2019, probably to the relief of the company's headquarters, which was paying HK$7 million a month for the 25,600 square foot store, double that of the previous tenant, Shanghai Tang.

"The company exercised a lease kick-out option for its A&F flagship store in Hong Kong," the retailer said on Friday. It claimed the move was "part of the company's ongoing strategic review" and "was expected to drive economic benefit over time".

Which probably means we had to cut our losses and review our strategy.

After the store vacates the Pedder Street location, Abercrombie & Fitch will not have a presence in Hong Kong anymore, though it plans to add five more stores to the mainland by the end of January.

How much merchandise do you have to sell to make rent?

Anyone could have told the company paying HK$7 million a month was too much, and how many jeans and T-shirts would it have to sell to make rent? Someone wasn't doing the calculations.

And besides there are fewer mainlanders shopping in Hong Kong, and the days of someone buying 10 Gucci bags at once are long gone.

They are lucky to get 10 customers buying one bag each these days.

So who is going to take over this prime shopping space? And will the rent be lowered too?

We're all eager to find out.

China Leads the Way in Mobile Payments

Scan the QR code, input your password and presto! You've paid the bill

China is way ahead of Hong Kong when it comes to paying without having to take out your wallet.

And I'm not talking about using the Octopus card either.

CNN's Will Ripley demonstrated this by going to a small stall that sells jianbing -- a giant thin omelet filled with various ingredients and then folded up to eat like a sandwich -- and paid for it by scanning the QR code with his smartphone on the shop door.

This payment system can be extended to large stores, taxis, and even utility bills.

To put this into context, almost 10 years ago when I was in Beijing, I had to walk over to the management office and buy electricity and gas before using it. I would know if I ran out if my air conditioner suddenly didn't work or didn't have hot water in the shower.

And paying rent? I had to physically take out cash from my bank account from where I did banking and then bring it to my landlord's institution and deposit the large wad of cash into his account.

CNN's Will Ripley with Gu Yu of Mileslife

These days people can pay their bills and even their rent with a click of a button on WeChat or Alipay their smartphones.

Gu Yu is the co-founder of a new payment app called Mileslife where users can share a taxi and split the bill at the end.

He explains that because China's credit card system is not lucrative, the Chinese have skipped credit cards and moved onto mobile payments.

The benefits are obvious -- no need to carry cash around, particularly in China where the biggest denomination is 100 yuan, electronic receipts and easily keeping tabs on spending.

So why doesn't Hong Kong move into this direction? When the Octopus card came out in 1997, it seemed so revolutionary at the time, being able to use it for all forms of public transport and buy items with it and pay for parking.

But is that all Hong Kong can do when it comes to electronic payments?

Is the Octopus card the best that Hong Kong can do?

As Alipay is run by Alibaba and WeChat by Tencent, the banks here would obviously want a piece of the action, which is probably why the city doesn't have this service now. And besides people obsessed with collecting air miles/points/cash rebates on their credit cards may find it hard to switch...

But aren't mobile payments the future? Or are we waiting for the rest of the world to get on the band wagon before we do?

Interesting that in terms of mobile payments, China is the leader with estimated retail sales on smartphones rose to 85 percent to around US$334 billion in 2015, according to research firm eMarketer. That makes the Chinese market more than four times the size of the United States'.

Mind boggling.

Hong Kong's Service Staff Feeling Blue

Glum-faced customer service staff wondering when sales will boom again

Have you noticed customer service staff particularly sad-faced these days?

It's confirmed now with the latest "smiling index" and Hong Kong was listed dead last out of 37 countries in a survey by Mystery Shopper Service Association.

The poll collected data from 61 countries and regions, and this year Hong Kong got a score of 48 out of 100, well below the global average of 83.

In the last survey in 2014, Hong Kong was third last. What happened?

Not many young front line staff take their jobs seriously

For comparison, Ireland was first for the second time in a row, while Macau was only one spot better than Hong Kong with a score of 53. Interestingly China ranked 26th with a mark of 83.

The association's chairman Anders Wong believed the weak economy, sluggish stock market and high property prices made it hard to encourage people to consume goods and services.

As a result, he said it was inevitable for front line staff to be frustrated by fewer sales and smaller commissions. Wong added the high turnover rate in retail and services showed that they didn't take their jobs seriously, particularly younger people.

"Hong Kong doesn't have a happy culture," he said.

Hmmm gee I wonder why!

Hong Kong was last out of 37 countries in a smiling survey

But we have to look at it from a long term perspective. Many people are not keen on serving others; it is very rare they find this satisfying to do. But at the same time, these staff don't feel like they have a personal stake in their jobs so they don't care as much.

If companies wish to improve sales, they have to treat their staff well. And smiles do go a long way. It's about marketing in the long term and hope that results in sales later down the road. A good experience is a memorable one that people will want to repeat.

Or is that wishful thinking?

Retail Sales Plunge in Hong Kong

Causeway Bay may look busy but who is actually shopping?

Retailers in Hong Kong are freaking out with sales plunging 13.6 percent in the first two months of the year, the biggest slump since 1999. More bad news is expected later in the year.

The Hong Kong Retail Management Association expects retailers to see double-digit decline in the first quarter, and end the year with a contraction in the high single digits.

Part of the reason is due to declining visitor figures, which dropped 13 percent in the past year. Those from the mainland fell 18 percent even though there was an increase of 7 percent in overseas visitors, according to the Hong Kong Tourism Board.

Supermarkets seem to be the best retail sector at the moment

Some expect large-scale layoffs and a string of shop closures this year if the situation doesn't improve.

In 20 retail categories surveyed, only supermarket goods recorded growth, expanding 0.2 percent in the first two months of 2016, while 13 other categories saw double-digit declines.

Thomson Cheng Wai-hung, chairman of the association, was very surprised people didn't splurge for Chinese New Year, adding that local consumption had softened.

"We were all shocked... People would not spend money even during Lunar New Year," he said.

The biggest slump was in jewellery, watches and other valuables that mainlanders typically came to Hong Kong to buy, followed by sales of clothing and department store goods, which shrank 11.4 percent and 12.3 percent respectively.

Jewellery and watch sales dropped in January and February

Cheng said many locals and tourists were more interested in spending their money outside of Hong Kong.

So many people are flocking to Japan to go shopping as the yen is weak and why not go to a place where the residents are polite, the streets are clean and food is delicious?

The second best places for value is Taiwan and Thailand.

While the slowing down of consumption isn't good for the Hong Kong economy, environmentalists must be thrilled people are spending less. And with supermarket sales going slightly up, that must mean more people are cooking at home, which is good for the waistline and the heart.

Perhaps reading enough stories about how fast fashion is not good for the environment, or people wanting to save money are reading about budgeting have led them to cut down on spending too.

Or am I being totally idealistic?

This year is not good for many sectors -- we're all in the same boat. But honestly, who was the one who thought Hong Kong should only concentrate on mainland clientele?

Nothing lasts forever...

The War on Books at the Airport

Page One bookstore is quitting the airport after its lease was up in April

From tomorrow there will be fewer reading material for sale at Hong Kong International Airport.

There were two bookstore chains, Relay, and Page One, and the latter has lost all six of its airport bookshops with its leases up in April.

Both bookstores' biggest shops near gates 20 and 21 will be replaced with luxury brands MCM and Hermes. Relay's other stores will be relocated to smaller spaces near departure gates.

But that's not all -- there will be five bookshops at the airport that will be run by mainland publisher and bookstore chain Chung Hwa. One wonders what kind of reading material will be for sale there.

It is believed the change in the bookshop vendors may have something to do with pressure being put on the Airport Authority to shut down bookshops selling politically sensitive books, in relation to the saga of the missing booksellers.

There will be fewer Relay stores in the airport

However, an Airport Authority spokeswoman said the decision was made to reduce bookstore space because of a "change in reading habits and advancement in technology", following regular customer surveys on travellers' needs.

When asked to comment, a spokeswoman for Page One said the proposed units up for tender by the authority were not appropriate for the chain to continue its presence in the airport, and cited the economic downturn as another reason.

Lisa Leung Yuk-ming, associate professor in the department of cultural studies at Lingnan University, said Chung Hwa had "quite a strong mainland Chinese background" and people might come to the conclusion that there were political reasons behind the change in book vendors.

"Airport book shops became a haven for all these controversial books about Beijing government officials and their sex lives and how they made their way [to power] through corruption," she said.

"They were a haven not only for books but for magazines publishing gossip tabloid stories about the mainland government. This might be a reprisal for bookshops selling these kinds of things or it might be self-censorship by the airport itself to try to weed out these problematic bookshop labels.

Pro-China Chung Hwa bookstore chain will be moving in

"It might be a more proactive strategy to let more pro-Beijing commercial presses have more space at the airport as a way to toe the official line -- [and say] these are the books you should be reading rather than the problem [ones]."

The Airport Authority spokeswoman declined to address concerns over a political motive for the reduction in bookshop space. "The selection of books to be offered in the shops is decided by bookstore operators," she said.

It sounds like the airport is taking a cue to be more politically correct and ensure it doesn't rile up Beijing. But really, those bookstores did make a lot of money from selling these books that are banned on the mainland.

So instead of confiscating the books when travelers enter China, why not stop them from even coming in in the first place, by cutting the number of bookstores in the airport and putting in a pro-China shop?

Talk about waging a soft power war on culture.

In the meantime I, like everyone else will have to buy our reading materials before we head to the airport. It sounds like this new reality is only the beginning of the new normal...