Hong Kong cosmetics retailer Bonjour Holdings has delisted slow-moving products and trimmed its store network as it grapples with falling sales and mounting losses.
The company has just released its results for last year, when sales fell by 18.7 per cent, following a 7.3-per-cent decline in 2018. The company’s annual loss attributable to shareholders ballooned from HKD39.6 million (US$5.1 million) in 2018 to HKD129.6 million ($16.7 million) last year.
Culling non-performing SKUs in stores, Bonjour Holdings shifted its focus to brands and products which are faster moving and/or have higher margins. Store layouts were changed to better display top-selling products and trendy lines to create an enhanced shopping experience.
Bonjour ended the year with 37 stores in Hong Kong, Macau and Guangzhou, two fewer than a year earlier. But within that figure, stores with weak sales performance were replaced by new ones in community districts as the company joined many local brands by shifting focus to locations frequented by locals rather than inbound visitors.
The company is also open to short-term leases for street-front shops which would be more flexible during the unsettled economic times and with negotiable rents.
In a stock-exchange filing, Bonjour Holdings said it was responding to a market disrupted by social unrest last year and now the coronavirus pandemic, by reducing its operating costs. Such measures include reducing store trading hours by reducing from two shifts to one, and requiring all staff to take at least five days of unpaid leave to reduce staff costs.