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Cheryl Arcibal

DFI Retail Group is set to lay off staff, as the operator of Wellcome, Mannings and 7-Eleven adapts to shifting consumer trends in the city.
An email sent to employees by Scott Price, CEO of Hong Kong’s largest retail group, and seen by the Post said the company would embark on a series of actions to simplify operations to meet customer expectations of lower prices.
It was unclear how many staff would be let go. DFI, formerly known as Dairy Farm, did not immediately reply to a request for a comment.
In the first six months of the year, DFI reported that it swung to a loss of US$38 million from a profit of US$95 million a year earlier. Hong Kong’s retail sales contracted for 14 consecutive months until May, when they rose by 2.4 per cent. In June, retail sales improved by 0.7 per cent from a year earlier.
“The reality is that, over the past five years, our support function costs have increased significantly,” Price said. “This has added unnecessary complexity, slowed down decision-making, and driven costs into our products that ultimately raise prices for customers.
“That is not sustainable. And it is not aligned with the business we want to be.”
Initiatives the group would undertake included “reshaping support functions”, “clarifying roles” and “offshoring and outsourcing selected roles”, Price said.
“I want to be upfront that these changes will impact some roles,” he said, adding that these were structural decisions and not reflections on individual performance.

Price said the company was grateful for the contributions of those affected, who would be “supported throughout this transition”.
Hong Kong’s retail slump has been attributed to lower tourist spending as well as Hongkongers’ preference to spend more of their disposable income either in Shenzhen, where products and services are cheaper, or on overseas holidays.
DFI has been divesting some of its businesses in Southeast Asia. In March, the group finalised an agreement to sell its Singapore Food business, which includes the Cold Storage, CS Fresh, Jason’s Deli and Giant brands, for S$125 million (US$97.4 million).
The company also divested 22.2 per cent of its stake in Robinsons Retail in the Philippines in May for 15.8 billion pesos (US$277 million).
DFI joins a growing list of Hong Kong companies, both big and small, that have reduced staffing levels.
In May, Hong Kong retail lender Hang Seng Bank let go of an undisclosed number of employees as part of a restructuring plan. The affected units were mainly in supporting departments such as information technology and corporate communications, as well as index compiler Hang Seng Indexes and some units that were being consolidated in the restructuring, the sources said.
The total number of people affected was not disclosed. Some departments lost up to 20 per cent of their staff, while the hardest-hit team was cut in half, according to sources.
Meanwhile, Link Asset Management said it was “streamlining a small number of roles and positions” as part of an efficiency drive in response to a “challenging operating environment”.
Hong Kong’s unemployment rate rose to 3.7 per cent in the May to July period – the highest in 33 months. Authorities partly attributed the change to university graduates entering the job market, along with contraction in the construction, catering, retail and property sectors.


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The 80-year-old Wellcome is the oldest supermarket chain in Hong Kong. Photo: Eugene Lee

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CEO of city’s largest retail group says high costs ‘not sustainable’ as consumers demand more for less


CEO of city’s largest retail group says high costs ‘not sustainable’ as consumers demand more for less.


Wellcome, 7-Eleven operator DFI cuts staff amid Hong Kong retail malaise

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}CEO of city’s largest retail group says high costs ‘not sustainable’ as consumers demand more for less

CEO of city’s largest retail group says high costs ‘not sustainable’ as consumers demand more for less