A report on the sourcing sector from InvestHK and KPMG reveals “with absolute clarity” that Hong Kong has a crucial role going forward, said Stephen Phillips, Director-General of Investment Promotion at InvestHK, at a Chamber webinar on 3 December.
According to this survey of senior executives, Hong Kong will remain a key hub due to its experience and expertise in logistics and financial services, its deep talent pool – and increasingly the fast-growing start-up sector.
Speaking generally about investment, Phillips said the Greater Bay Area (GBA) initiative was having a significant impact: “I can say, without a shadow of a doubt, it is the single most important magnet for foreign investment that we see – across every sector.”
This will continue, he added, as more GBA policy initiatives continue to be rolled out, enhancing the opportunities available.
Anson Bailey, Head of Technology, Media and Telecommunications, Hong Kong and Head of Consumer & Retail, ASPAC for KPMG China, gave some more details about the report.
“The key message was that we are never going to see another Hong Kong emerge,” he said. “Hong Kong is still a very important sourcing hub for international companies.”
Hong Kong’s history as a bridge between East and West means we have a unique business culture that can serve both Mainland and multinational companies
“A lot of senior executives told us that they liked the fact that Hong Kongers have a very international business outlook,” he added, and these soft skills are an essential part of the city’s attractiveness.
A key trend in the survey was a rise in ESG reporting and sustainability, Bailey said. Consumers, including those in the Mainland, are increasingly expecting to have transparent information about the origin of goods. Regulators are also moving in this direction, and businesses will need to be able to prove that they are “walking the talk.”
The sourcing sector is also embracing start-ups and new technology, with The Mills being a great example of this, Bailey added. Based in Tsuen Wan, The Mills is home to a mix of innovative textile businesses, business accelerators and fashion start-ups, as well as a showcase for the city’s textile-manufacturing history.
In the panel discussion that followed, Anne-Laure Descours, Chief Sourcing Officer at PUMA, discussed how the company had coped with the Covid crisis.
“We have cancelled less than 1% of orders,” she said. “We worked with suppliers to make sure they always had something to do, so they did not have to stop operating.”
PUMA was able to do this because it has improved the resilience of its supply chain in recent years by consolidating the number of suppliers, making cooperation easier – the importance of which was made very clear in 2020.
“What Covid demonstrated is you cannot survive such a crisis yourself,” Descours said. “You have to build partnerships.”
She added that PUMA had several years ago moved its sourcing centre to Asia, as this is where the expertise is located – not Europe. However, she added, there were some potential talent issues as the industry evolves and becomes more innovative.
“The challenge we have in sourcing is switching the capability of the people – which used to be transactional – into being more entrepreneurial.”
The Buy Hive is a start-up that helps global buyers find freelance sourcing experts around the world through a trusted online platform. In 20 years of sourcing, Minesh Pore, Co-founder and CEO, has lived around the world, but Hong Kong was the obvious choice to base the new company.
“We chose Hong Kong as it is the only place that has the in-depth talent pool and freedom to connect with not just China, where most of the production is, but also the rest of Southeast Asia,” he said. “The soft skills and sourcing professionals in Hong Kong cannot be built overnight anywhere else.”
The Buy Hive also aims to solve some of the industry’s talent issues. Changes brought by digitalization and Covid have left some industry professionals – such as merchandisers – out of work. The Buy Hive can help them connect with companies that need their expertise.
Pore added that sourcing workers in Hong Kong not only have manufacturing experience and the skills needed for international trade, but also technology know-how.
“Innovation and technology will drive the next phase of sourcing in Hong Kong,” he said. “The skills that are available here mean that Hong Kong is only going to get stronger in this space.”