Health-care chain to shut down as challenges mount

Wallis Wang

Health-care chain CRcare will shut its remaining 19 branches in Hong Kong on November 8, citing external uncertainties and operational challenges.

The retailer under China Resources Pharmaceutical Group has been closing branches since April, including those in Tuen Mun, Yau Tong and Kwai Fong.

The chain has 19 branches left - four on Hong Kong Island, three in Kowloon and 12 in the New Territories - down from the 25 it had in August.

The chief strategy officer of China Resources Group (Greater Bay Area), Hoey Simon Lee, who is also a lawmaker, said it was a difficult decision to close down the chain, but one made based on the business environment and the company's strategies.

China Resources will concentrate on innovation and property business and affected employees will be transferred to other positions, Lee said. He added its closure will not affect consumers as the market has sufficient supply of products offered by the chain.

On Facebook yesterday, the chain expressed gratitude to its customers for their support since its founding in 1999. It posted: "As our business is affected by external uncertainties and various operational challenges, CRcare decided to close down all Hong Kong branches on November 8 after careful consideration."

It said it will no longer accept new members and give points to existing members. It appealed to members to redeem gift coupons and products by November 7.

A man expressed disbelief at the chain's closure, saying he never thought it was in trouble as it was owned by a large group. The man said CRcare offers a wider range of medicines than other pharmacies, including lesser-known stomach remedies.

A woman, Wong, said she was saddened by the closure, as CRcare has been operating for a long time. She added: "I used to see store staff every day but now they will cease operation and I don't know what to do."

A man named Tsang, however, said he expected the closure as the chain has been shutting down branches.

Another customer said the closure will not significantly affect the general public as drugs and other health-care products are available elsewhere.

Chung Pok-man, vice chairman of the Hong Kong Department Stores and Commercial Staff General Union, expects around 50 to 60 CRcare employees to be affected, though the group has yet to receive calls for assistance.

He said 10 CRcare staff who are union members were approached in late July and asked if they were willing to transfer to other business areas.

Chung quoted the employees as saying that although CRcare had many branches, the number of customers had plunged after the pandemic and changes in consumption patterns also contributed to the decline. He added the looming closure adds to concerns within the retail industry as "even major brands are struggling to survive."

Wholesale and retail sector lawmaker Peter Shiu Ka-fai said companies are still adjusting their strategies as more Hongkongers have switched to shopping online or prefer to spend across the border, while the consumption pattern of mainland visitors has also changed.

Chinese University associate professor of economics Terence Chong Tai-leung said the closure of physical stores does not indicate a poor economic environment given that more companies registered last year and in the first half of this year than those that shuttered.

wallis.wang@singtaonewscorp.com