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Singapore firms operating in protest-racked Hong Kong hit by declining sales, late deliveries

SINGAPORE — Some Singapore companies operating in Hong Kong have taken a financial hit amid the ongoing political unrest engulfing the city.

Some branches of OCBC Wing Hang, the Singapore bank's Hong Kong brand, closed early as a result of the protests, a spokesperson said.

Some branches of OCBC Wing Hang, the Singapore bank's Hong Kong brand, closed early as a result of the protests, a spokesperson said.

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SINGAPORE — Some Singapore companies operating in Hong Kong have taken a financial hit amid the ongoing political unrest engulfing the city.

Several companies told TODAY that sales have declined and client orders have slowed.

While some have had to adjust operations or temporarily suspend them, none has so far been forced to take any extreme measures, such as repatriating staff.

But companies are preparing contingency plans in the event of a worsening of the crisis, which has dragged on for almost two months.

SALES HAVE TAKEN A HIT

With the retail and tourism sectors bearing the brunt of the protests, food and beverage company BreadTalk Group said sales at some of its outlets have declined by as much as 40 per cent.

Business at its three brands, BreadTalk, Toast Box and Food Republic, was not hit that hard initially when the protests started in June, with sales declining by 10 to 15 per cent.

However, sales dived by 20 to 40 per cent over the last two weeks as the situation in Hong Kong became more tense, said Mr Jenson Ong, chief executive officer of BreakTalk Group’s food atrium division.

The company has a total of 28 outlets in Hong Kong across the three different brands.

Another Singapore firm, dating agency Lunch Actually, relies on the weekends — when many of the protests are held — to meet prospective clients and arrange dates.

Chief executive officer Violet Lim told TODAY that the number of customers signing up for their services has slumped 30 to 40 per cent compared with the period before the protests.

With roads blocked and the train system disrupted during the weekends, prospective clients are not able to head to their office for consultations.

“Again, weekend is time for people to go out on dates. People sign up. We want them to go out on dates but they can’t. They feel unsafe to go out,” said Ms Lim.

“People have no mood to date. … One client actually told (one of my Hong Kong colleagues), ‘Why are you working, you should be protesting’,” she added.

As for logistics company YCH, its marketing and public relations manager Yvonne Wong told TODAY that the impact on its business has been limited as its operational presence is not in the heart of the affected areas.

However, sales have been slower because of the unrest.

HOURS SHORTENED, STAFF ASKED TO GO HOME

Operation hours were also shortened for some businesses to allow their staff to leave work earlier.

Mr Ong said BreadTalk and Toast Box outlets located along Nathan Road, a major artery in Kowloon where protesters blocked traffic on Saturday (Aug 3), are closed earlier on weekends.

Singapore banks, such as Oversea-Chinese Banking Corporation (OCBC), which operates under the OCBC Wing Hang brand in Hong Kong, and DBS Bank, were also not spared.

While operations have continued normally over the past two months for OCBC Wing Hang, some branches near the protests this week were “closed early to ensure the safety of our employees and customers”, said Ms Koh Ching Ching, Head of Group Brand and Communications, OCBC Bank.

“Our colleagues had also been asked to leave for home earlier this week and alternative transport arrangements made for colleagues who had to stay,” she added.

DBS Bank told the Business Times that all of its Hong Kong branches were temporarily suspended on Monday afternoon owing to safety concerns.

All other branches resumed operations on Tuesday, except for one at North Point district where services were temporarily suspended “for the safety of our employees”, said a DBS spokesperson in response to queries from TODAY.

Despite the early release, Ms Lim said that some staff took as long as two hours to get home due to disruptions to the transportation network.

“If they are not able to take the bus, we tell them to take a cab and claim from the company. Safety is the most important,” she added.

DISRUPTIONS TO TRANSPORTATION NETWORK

With protesters blocking roads and disrupting the train system, Singapore companies said some of their staff have had problems making their way to work.

Ms Lim said staff who are able to work from home are encouraged to do so. Client appointments with sales staff, however, have been cancelled on occasions when they were not able to make it to work.

For marine and offshore company Amos, non-executive director Danny Lien said that alternative manpower arrangements had to be made when staff were unable to come in for work due to the protests.

Transport disruptions have also led to the late delivery of goods to clients, said both Mr Lien and Ms Wong.

Beyond that, however, both companies said that the protests have had minimal impact on their businesses as their warehouses are not located near the protest sites and clients are also aware of the challenges that they face.

“We communicate to customers that we can’t supply on time because of what’s going on in Hong Kong. People understand,” said Mr Lien.

“Our transportation team thus has to work closely with the truckers and make sure the goods receivers are well informed when there is a traffic issue, and work out an alternative schedule with the clients… Everybody is just prepared that goods are taking a longer time to arrive,” said Ms Wong.

CONTINGENCY PLANS

Companies said that they are putting in place contingency plans in the event that the protests escalate.

Both Ms Wong and Mr Lien said that the worst-case scenario would be having to divert their operations to other locations outside of Hong Kong.

Amos, for example, also has operations in the ports of Shanghai, Busan in South Korea, and Singapore, and ships may be diverted to these ports in the event the Hong Kong port becomes too congested as a result of a massive amount of late deliveries.

Ms Lim also said that Lunch Actually may have to divert certain business functions, such as marketing, from Hong Kong to other offices in Asia.

However, they felt that the situation in Hong Kong does not warrant such measures yet.

“Right now, we are adopting a look-and-see approach. It’s not a doomsday kind of scenario yet,” said Ms Lim.

Companies were generally positive that the government and the protesters will eventually resolve their differences.

In fact, Mr Ong said Food Republic will continue with its plans to open a sixth outlet in Hong Kong at the end of this month.

“Business cannot stop, we have invested so much in Hong Kong… I believe this will calm down as it goes along. Hong Kong is an international city, where a lot of foreign companies are present,” he added.

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