Market Intelligence – The outlook of Hong Kong Retailers 9.25.20

The following information was produced by the US Consulate General Office, Hong Kong.

Focus on hand cleansing and self-care skincare regimes for Hong Kong retailers in midst of the pandemic

Following the outbreak of the COVID-19 in Hong Kong in February 2020, retailers have had to restructure their product mix and offerings to focus on hand sanitizers and hand washing products. As more consumers stayed home during the pandemic, self-care skincare and personal care products also became the focus of retailers. Consumers became more interested in actionable information rather than new product launches, as they now have more time to view videos on how to apply make-up or use certain skincare and personal care products.

Personal care products like dry shampoos, which were not as popular before the pandemic, sold out quickly as consumers avoided going to the hair salon. Hand creams with powerful moisturizing ingredients are also very popular. Sales of hand-held facial treatment devices, daily-use facial treatment masks, and home spa, home nail, and hair coloring kits also increased. Spas and facial treatment salons were closed for several weeks in the March to May period and re-opened for a few weeks starting the end of May. At the end of July when COVID-19 cases surged, the Hong Kong Government again tightened social distancing and these establishments were required to close until further notice.

Hong Kong is an open market, as there are no import duties or product registration requirements for cosmetic products. However, the market is very competitive, with the top ten brands accounting for about 70% of the total market. Appointing a local distributor and working closely with them to promote the brand is crucial; adapting products to local demands and trends is necessary to remain competitive. This includes, as an example, brightening ingredients and modifying the packaging, and product sizes to suit local tastes.

U.S. manufacturers of personal hygiene and personal care, skincare and cosmetic products that are interested in exporting to Hong Kong may contact the U.S. Commercial Service in Hong Kong for assistance in locating local distributors. Last year, we organized a Virtual Product Fair (VPF) for four skincare and personal care manufacturers in the U.S. to present their products to a group of distributors and retailers in Hong Kong and in various cities in China. Through the VPF one of the four American manufacturers of skincare products was able to appoint a Hong Kong company that attended the VPF as their distributor. The products are now being sold to local spas and skincare products specialty stores.

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Kimberly Pederson

Kimberly first got a taste of international e-commerce when she interned at the Center for International Trade Development while working on her statistics and economics degree at California State University, Long Beach. Here, she had the opportunity to assist with the organization of a California Pavilion at an International Beauty Trade Show.

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