Hong Kong’s major retailers are using aggressive tactics such as direct sourcing and leveraging massive economies of scale to avoid raising prices despite surging logistics costs arising from the war in the Middle East.
But their resilience is being seriously tested for certain goods, with a leading cosmetics chain warning that shipping and airfreight costs have already surged by up to 15 per cent.
Sa Sa International chairman Simon Kwok Siu-ming told the South China Morning Post on Friday that since some beauty items were petroleum by-products, they would face further pressure for price increases if the situation worsened and affected fuel supplies.
“Fuel and transport-related costs have indeed risen, with shipping and airfreight fees already increasing by about 10 to 15 per cent,” Kwok said.
“Although the group’s products have not experienced shortages or any obvious delays, the unstable situation makes delivery timelines more difficult to control,” he said. “We are closely monitoring developments to manage our inventory in a more prudent and flexible manner to minimise the impact.”
The warnings follow weeks of geopolitical turmoil triggered by the start of the US-Israeli war on Iran in late February.
