Earlier in the 1950s, the first store appeared in Hong Kong, but the number of stores was not a lot. A large number of
public housing was being constructed, the demand for groceries greatly increased, this was this most prosperous period for the development of store. In the 1970s, there was a trend of decreasing local stores. Between 1974 and 1985, the number of small grocery shops selling general provisions dropped by 30% The dominance of two companies in the supermarket industry-
Dairy Farm International Holdings and AS Waston Group-has long concerned consumer rights advocate and been regarded the main cause of the trend. Dairy Farm which operates Wellcome stores and Waston (Parknshop) account for up to 62.5% percent of the grocery store market in Hong Kong, while wet market and smaller operators are included only 30 to 40 percent of the market. In which the pricing strategy and dominating power of larger supermarkets are regarded threat to small-scaled grocery stores. As their average of production cost are lower than that of individual stores, the price of products sold in chain shops would be a lot cheaper. With the locational advantage of
convenience stores and supermarkets, people prefer shopping in chain shops instead of small store. This caused the decline of traditional stores. In 2013, the industry was under the Consumer Council Investigation of the long intervention the grocery giants have on their competitors on in-store price regulation. It is claimed larger supermarkets monitor competitors and if they see a supplier’s product selling cheaper elsewhere, depending on the contract terms, they can claim the difference back. According to news report in 2011, a small grocery store operator in Chang Sa Wan was being complained of the relative low price it sell of the
Nissin Foods instant noodles by Parknshop supermarket. This puts the pressure on the smaller retailers on the agreement of identical selling prices as of the supermarkets or face sanctions. In the past decade, the number of stores decreased from a few hundred to less than 40 in Hong Kong. ==References==