Hong Kong is a teeming, commercially-vibrant metropolis where Chinese and Western influences fuse. The former British colony became a special administrative region of China in 1997, when Britain's 99-year lease of the New Territories, north of Hong Kong island, expired.

Hong Kong is governed under the principle of "one country, two systems", under which China has agreed to give the region a high degree of autonomy and to preserve its economic and social systems for 50 years from the date of the handover.

Fast Facts

Name of country: Hong Kong Special Administrative Region

Population: 7,122,508 (July 2011 est.)

Key cities: Hong Kong

Telephone country code: 852

Source: http://premier.rw3cg.com/content/approved/hong%20kong/premier_frame.htm

2) Most of political factors are considered to be "opportunities" for IKEA in Hong Kong. For example, because of Hong Kong low tax policy, IKEA is able to keep their prices low and earn more profit. Most of IKEA's furnitures are manufactured in Mainland China, Vietnam, Cambodia, so Hong Kong's free trade and non-tariff policy will make it easier for IKEA to do business there. However, Hong Kong business registration requires the business to have a HK-resident company secretary. This should help IKEA somehow because they will have better access to understand local knowledge, but anyway, maybe that's the kind of money they don't want to pay for.

Since houses in HK are relatively small, the residents here will like IKEA products because of its special designs for a convenient small house. The targeted customers of IKEA is mainly middle-class. Therefore, as the class division in Hong Kong is getting more obvious ( the rich is getting richer and the poor is getting poorer), there will be less middle-class people in HK, IKEA's customers range will automatically narrow down. Also, there is a sign that people start wanting to leave Hong. Since Hong Kong itself is not a big market (7 million people), now as many people want to leave, maybe it's not a good place to

 3) Since the trading policies in Hong Kong are very business-friendly, I think IKEA should offshore production to mainland China and other developing countries to reduce cost. IKEA should focus on convenient furniture for compact living space, meanwhile start developing furnitures what are either really high-end or really low-end. As my prediction, Hong Kong population will not be increasing at least in the next few years, therefore IKEA shouldn't expand and build more stores here. 


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    March 2013