Clothing and fashion to Hong Kong

Trends and opportunities

The market

Hong Kong is the leading regional international shopping hub for North Asia. The city offers an attractive retail environment for local customers and overseas visitors due to its zero sales tax and broad diversity of authentic products.

The Hong Kong apparel market remains very competitive. In 2013, sales by apparel specialty retailers in Hong Kong reached HK$57.7 billion, an increase of more than 10 per cent compared with 2012 (Source: Euromonitor, Apparel and Footwear in Hong Kong, 23 Oct 2014).

With a vast assortment of international brands present, Hong Kong is a shop window for tourists and an excellent platform to showcase international products. The city acts as a stepping stone to enter mainland China and other regional markets.

Hong Kong is particularly notable as a favourite destination for mainland Chinese shoppers because of lower retail prices, zero sales tax, authentic products and proximity. In 2013, some 40 million mainland Chinese were among the 54 million visitors flocking to Hong Kong (Source: Tourism Commission, Tourism Performance 2013, 10 Apr 2014).

Mainland Chinese represent one of the largest consumer groups and contribute significantly to the sales of fashion products and apparel.

According to a recent survey of China’s middle-class consumers conducted by Hong Kong Trade Development Council, middle-class mainland Chinese consumers generally have positive perceptions of Hong Kong, including its reputation as a fashion capital. The majority of the respondents agree that “Hong Kong is a place for original fashion trends and a trendsetter”. (Source: Hong Kong Trade Development Council, Mainland Middle-Class Consumer Survey Highlights Opportunities for Hong Kong Companies, 1 Aug 2013)

In a market dominated by international brands, specialty apparel retailers remain the major distribution channel. Major international brands from Japan, Europe and the USA have opened outlets, such as:

  • Abercrombie & Fitch
  • American Eagle
  • Forever 21
  • Gap
  • H&M
  • Marks & Spencer
  • Topshop
  • Uniqlo
  • Zara.

Major local apparel retailers such as Baleno, Bossini, Chocoolate, Catalog, Esprit, Giordano, G2000, Mirabell and b+ab, etc. have set up chain stores in Hong Kong.

As well as expanding their own outlets, these apparel retailers are introducing online retailing platforms. However, while internet retailing is growing, it remains very small in Hong Kong compared to store based retailing.

Local consumers are increasingly concerned with brand image and fashion trends, especially among the 20 to 30 year old demographic. Consumers are more receptive to international fashion labels, especially fast fashion brands which are trendy yet affordable. The majority of local consumers focus more on fashion and less on function.

Opportunities

Australian fashion designers have a growing reputation worldwide for quality and innovative designs. Australian lingerie, ready-to-wear, evening wear, men’s wear, streetwear and accessories are becoming more established internationally. Australian swimwear and surfwear are often regarded as world market leaders with many well-known brands such as Billabong, Quicksilver and Roxy.

Australian designers showcase their brands at international fashion shows such as, Mercedes-Benz Fashion Week Australia and the Melbourne Fashion Festival. However, with opposing seasonal patterns, collections that are more trans-seasonal than season-specific can help to increase sales in the Hong Kong market. Also, the seasonal half-year lag can be a good opportunity for Australia to analyse and capitalise on trends that have worked commercially in the northern hemisphere.

Awareness of Australian fashion is relatively limited in Hong Kong. However, the presence of Australian fashion labels and designers in the city continues to grow. Over 70 Australian labels, ranging from high-end women’s wear, footwear to swimwear are represented by fashion outlets such as:

  • Bauhaus
  • Harvey Nichols
  • Lovers+Friends
  • I.T
  • Joyce
  • Lane Crawford
  • SWANK
  • TWIST.

Hong Kong fashion merchandising buyers and consumers in the high-end market are very brand conscious and require unique and high-quality design with attention to detail. For the middle to casual wear market consumers, they generally opt for items that offer comfort, functionality and value for money.

Licensing can be an option in certain markets, if suitable partners can be identified. In addition, private label design could also be an opportunity in Hong Kong, given local companies’ strong ties to the fashion industry in mainland China.

Tariffs, regulations and customs

Hong Kong imposes no tariffs on imported textiles, clothing or footwear products and no regulatory requirements for clothing labels.

Labels generally contain three pieces of information pertaining to the garment:

  1. fibre content
  2. country of origin
  3. details of the manufacturer, importer or dealer.

Garments usually include labels that disclose care instructions for the consumer's benefit.

Marketing your products and services

Market entry

Buying season in Hong Kong is January to March for a September (fall/winter) delivery and July to October for a February (spring/summer) delivery. Fashion buyers travel to Europe, America and Australia to attend major fashion shows to explore the latest trends and designer brands.

Mercedes-Benz Fashion Week Australia and the Melbourne Fashion Festival are major fashion shows selected by buyers from Hong Kong. The fashion shows present excellent opportunities for Australian designers to showcase their latest ranges.

Australian fashion houses and designers are advised to work with agents in Hong Kong, who will work on a 30 to 50 per cent margin and with significantly more for the retailer. As a general rule, the imported Australian product is usually sold about nine to 10 times the ex-factory price. Buyers often make purchase decisions by comparing pricing to other similar brands/products already sold in the market.

Competitive Environment

Competition is fierce as the Hong Kong market is highly fragmented with and dominated by international fashion labels from Europe, Japan, Korea and the USA.

In recent years, the pop culture wave of Korean fashion style has recently intensified the competition. Fast fashion brands from Korea which are trendy yet affordable are becoming more popular.

Brand building and PR

Hong Kong is a highly media-influenced market, quality marketing materials and brand development is vital.

Social media tools including blogs, beauty forums and Facebook are key influencers of consumers’ purchasing decisions. Fashion bloggers and celebrity endorsements are effective ways for brands to communicate with potential consumers. For example, Hong Kong Fashion Geek is a Hong Kong based blog focusing on a variety of lifestyle topics, including fashion, food, consumer gadgets and design.

Major weekly and monthly beauty, fashion, health and lifestyle magazines are an important tool in promoting your brand and products and all provide significant coverage of new and emerging fashions.

Australian fashion houses and designers are also advised to appoint a public relations company in Hong Kong to build media profile and coverage for brand building and growing sales.

Distribution channels

Specialty apparel retailers remain the major distribution channel. Medium to high-priced fashion labels are usually sold in renowned department stores, who usually prefer to import directly from overseas from designers with established brands and a successful track record in Hong Kong.

Online and catalogue retailing are becoming more popular due to high commercial rental costs.

Australian fashion houses and designers can seek to distribute their products through fashion and apparel distribution channels in Hong Kong including:

Trade events

Trade fairs and exhibitions remain common places for buyers and suppliers. To establish connections and explore market opportunities, Hong Kong manufacturers and overseas traders have involved themselves actively in international shows such as:

Links and industry contacts

Clothing and fashion-related resources

Hong Kong Fashion Designers Association
Hong Kong Apparel Society Limited
Hong Kong Intimate Apparel Industries’ Association (HKIAIA)
Clothing Industry Training Authority (CITA)
Hong Kong Research Institute of Textiles and Apparel (HKRITA)

Government, business and trade resources

Fashion Industry in Hong Kong
Hong Kong Trade Development Council
Invest Hong Kong
Australian Chamber of Commerce of Hong Kong

Media

Cosmopolitan
East Weekly
Elle
Jessica
Marie Claire
Milk
Next Magazine
Oriental Sunday (More magazine)
Sudden Weekly (me magazine)

Specialised Public Relations

Brand X
Electric Sekki
Lee Wolter Company Limited
Occasions PR & Marketing Limited

Apparel specialty retailers

Bauhaus
Harvey Nichols
I.T
Joyce
Lane Crawford
Lovers+Friends
SWANK
TWIST

Department stores

Sincere
SOGO
Wing On

Appointing distribution agent

Electric Sekki
Runway Workshop

Online and catalogue retailing

Christing C
The Powder Room

Please note: This list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only. The content is for information and carries no warranty; as such, the addressee must exercise their own discretion in its use. Australia’s anti-bribery laws apply overseas and Austrade will not provide business related services to any party who breaches the law and will report credible evidence of any breach. For further information, please see foreign bribery information and awareness pack.

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