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Family Fortunes

110years ago, a small store opened in Hong Kong and transformed the way the city shopped. Today, Wing On remains one of the city’s best-known names and the department store is a firm fixture in the retail landscape.

This was not entirely the beginning of the Wing On story. Brothers Kwok Lock and Kwok Chin had previously opened a grocery store in Sydney specializing in fruit and vegetables, before expanding into other areas including providing a remittance service for the Chinese community in Australia at that time. Ten years later, they decided to return to Hong Kong.

“When we started in 1907 Hong Kong was a relatively small place, the population was maybe a tad below a million,” explained Mark Kwok, Executive Director of Wing On and a member of the third generation to run this family business.

As success in Hong Kong led to plans for expansion, Shanghai was the first port of call, in 1917. “Shanghai for the Chinese was like New York City for the Americans. It was the commercial centre of China.”

In the 1930s, the company opened an office in London, as many of the items stocked in the Chinese stores were shipped from the north of England, still a major manufacturing centre at that time. “The middle class in China loved to use English products,” he said.

After the establishment of the People’s Republic of China, the stores in the Mainland were taken over by the government, but it was the start of a long-lasting boom for Hong Kong, and for Wing On, its golden era was just around the corner.

“The economic take-off in Hong Kong was actually in the ‘50s,” Kwok said. During the civil war in China a lot of industrialists and skilled labourers had moved to Hong Kong, which helped the city develop its manufacturing industry.

“So the Hong Kong community economy was booming, and business was good.”

The opening up of China in the late 1970s saw much of Hong Kong’s industry move to the Mainland, triggering a shift in city’s economic focus.

“The factories were torn down and replaced with apartment complexes,” Kwok said. “From that time, the biggest players in town were the real estate developers.”

Wing On is a one-stop shop stocking everything from clothes to electrical goods, and, for decades, the company’s well-made products were exactly what the Hong Kong market required.

“In the ‘60s and ‘70s and ‘80s, most people in Hong Kong were not that affluent. So what they were looking for was durable, well-manufactured merchandise – regardless of whether it was a shirt or a pair of shoes,” he said.

By the 1990s, Wing On had 14 different branches operating close to a million square foot of floor space. Things started to change as retail customers became more interested in branded goods. Then, the late 1990s also saw the devastating impact of SARS and the Asian Financial Crisis on the whole city. Many once popular department stores came and went with the fortunes of Hong Kong. Wing On however, has stood the test of time, but has had to adjust to the times.

Wing On cut the number of stores it operates, but as the company owns its buildings, including the flagship Sheung Wan store, it is protected against spiraling rental costs.

A more recent challenge has been the growth in online shopping. But, Kwok pointed out that the flow between online and offline is no longer going in only one direction.

“There is a very interesting phenomenon the world over now, where these really big online stores are looking for brick and mortar,” he said. Digital giants like Amazon and Alibaba are seeking to open physical stores and talking about eradicating the difference between online and offline retail.

For Wing On, this means embracing internet shopping. “We currently have a team that is getting their hands dirty developing an online concept. Once we have done that – because we have our own physical stores and we have our own logistics – we can blend it in.”

A diverse career

While many Hong Kong people can say that they have grown up with Wing On, it is particularly true for Kwok, a grandson of one of the founders. He has worked for the store “all my life,” he said.

As a child, he helped out in the toy department during the Christmas rush. After university in the United States, he joined the Wing On Bank until it was taken over in the 1980s. He has also spent time in the group’s hotel, department store and overseas investment divisions.

Kwok’s career path within the group is a reminder that there is more to Wing On than the department store, and property remains a focus for Kwok.

“Other than the department store, I’m still looking after the foreign investments. We have some property in Australian and America and we’re always looking out for opportunities. It’s not that easy, even though we have a very big war chest,” he said, noting that in the real estate sector, identifying the right time buy is always difficult.

Kwok and two of his older brothers remain actively involved in Wing On, and their sons – now the fourth generation – also work for the company. There is a fifth generation, but they are still small children, so not out on the shop floor just yet.

“Being a family business, you are insulated from a lot of things,” Kwok said, noting that the group, like many family companies, tends to be risk averse.

“We like to invest in real estate, in terms of buying buildings, because it’s protected. It has got a value – it will be tenanted so the mortgage will service itself.” The company also tends to do business in countries that have a legal system similar to the English one.

“On the good side it protects us, on the bad side we don’t grow,” he said. “We’re not able to diversify as much.”

But while a risk-averse approach is part of the reason for Wing On’s longevity, it does not mean that the same applies to the personalities behind the business.

Kwok has established an innovative business farming giant groupers, however, it is a personal project, not part of the Wing On group. As well as an indoor facility in Hong Kong, he has also bought a hatchery in Australia.

“In terms of accountability, in terms of traceability, the operation has been accredited by WWF as sustainable fish farming.”

This method of fish farming is fairly new, meaning that Kwok is in the vanguard of the industry.

“I am probably the main guy on this planet that’s really doing it in a big way,” he said.

From the Great Depression of the 1930s, to War and Occupation, riots and SARS, Wing On has not only survived many shocks but has remained safely in family hands.

“The line of control is very important,” Kwok said. “When you have a family that gets bigger and bigger, that leads to many different groups controlling the company.”

So sometimes the ownership has to be pruned back. The company has had some disasters over its long history, including the demise of the Wing On Bank.

“We were taken over because the bank ran into trouble, and that was purely because of bad management of a family member. So after that event, the controlling structure was changed.”

Kwok recalled that when he and his brothers were running the company in the early 1980s, their father had already passed away.

“We didn’t have anybody to look up to – we were thrown in at the deep end,” he said. “So the important thing – that is very different for our sons – is that we are still around. So the structure is stronger and more stable.”

As a pillar of the business community in Hong Kong, it is no surprise that Wing On is also a long-standing member of the Chamber, having joined back in 1948.

“The Chamber ultimately represents the business interests of the community,” Kwok said. HKGCC’s links to Government and influence with policymakers are particularly important. “I think it’s good that we get the companies represented; that we have a voice,” he said.



Company: Wing On Co Ltd, The

HKGCC Membership No.:HKW0093


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