Hong Kong’s commercial model is now quietly reaching a turning point.

Until now, Hong Kong has been supported by its overwhelming geographical advantage: “convenient transportation” and “people coming from all over the world.”

Both large commercial facilities and restaurants had grown entirely accustomed to a “flow-bubble economic structure” where “if they come, it sells” and “if it’s on the street, they will enter.” Recently, however, “Northbound Consumption”—the trend of traveling from Hong Kong to mainland China, such as Shenzhen and Guangzhou, for shopping purposes—has rapidly increased. According to weekend data in 2024, it is said that about 12 to 15% of Hong Kong residents cross the border every weekend. Neither tourists nor local consumers place absolute priority on “buying in Hong Kong” anymore.

* Related Articles: South China Morning Post “Hongkongers increase cross-border shopping splurges, spending data shows“

If tourist pricing is maintained while service remains mediocre, local consumers will leave. The reality is becoming clear that “high price and mid-level service” cannot win against Shenzhen. What is being questioned is not the location, but the “reason to be chosen.” It might be the time to rebuild the rationale of the brand: “Why go here?” and “Why buy at this store?”

(To be continued)