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By Karen Cho (China Daily)
Updated: 2007-11-16 06:50

HONG KONG: Hong Kong businesses should target the mainland's rapidly growing retail market, especially in cities with great potential for retail consumption, such as Hangzhou, Suzhou and Ningbo, the Hong Kong Trade Development Council said yesterday.

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Analyzing more than 200 mainland cities, the council identified 30 cities with strong consumption power. The council issued different ratings to various cities depending on their potential to become retail hubs. First-tier cities, such as Beijing, Shanghai and Guangzhou, were given the highest AAA rating. Dalian, Hangzhou and Tianjin were among the 10 cities classified as AA.

Hong Kong Trade Development Council chief economist Edward Leung said the purpose of the analysis is to aid Hong Kong merchants' efforts to open up the lucrative consumer market on the mainland.

"If merchants want to sell more Hong Kong-made products on the mainland, they should concentrate on provincial and regional consumption centers," Leung said, adding that Hangzhou, Suzhou and Ningbo have excellent potential.

"In one or two years, (these three cities) will be able to reach the consumption levels of big metropolitans, such as Beijing, Shanghai and Guangzhou," he said.

The council also found that East China and Central China are regions where awareness of Hong Kong brands remains low. So Hong Kong companies should hone their advertising and marketing efforts in these regions, it said.

"Those regions are further away, and consumers there find it difficult to tell the difference between made-in-Hong Kong products and other brands," Leung said. He added that keeping prices competitive and concentrating on design and packaging would give more Hong Kong brands an edge in those markets.

Among the 30 top-ranked cities in terms of consumption power, most are clustered around the eastern coast.

(China Daily 11/16/2007 page14)