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Gome exits Hong Kong’s retail market

By Huang Ying (chinadaily.com.cn) Updated: 2013-01-21 20:46

Gome Electrical Appliances Holding Ltd, one of China's leading electronics retailers, said on Jan 20 that it will exit Hong Kong's retail market.

The company said its six stores in Hong Kong will begin to shut down from Feb 1, affecting about 100 employees.

The retail giant said in a statement that it will turn its retail business into a bulk trade business, to take advantage of Hong Kong's geographical and commercial strengths, in order to expand its international procurement business.

Caroline Mak, chairman of the Hong Kong Retail Management Association, said that, in addition to the rising rents, the supermarket business model which Gome uses is not a good fit for the Hong Kong market, according to a report in the Hong Kong Economic Journal.

In Hong Kong, Gome just owns six outlets, while its local rivals — Fortress and Broadway — have much more stores. Also, most of Gome's products can be found in other department stores, intensifying the competition it faces there, Mak said.

Related stories:

Gome to boost e-commerce growth from mobile devices

Appliance giant Gome sues ex-chairman

 

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