HONG KONG, Oct 14 — Hong Kong's business landscape is undergoing a transformation as companies employ various strategies to navigate the current economic challenges, marked by a notable increase in closures.

Affected sectors are adapting by pursuing extensive renovations and exploring new markets to attract customers, South China Morning Post (SCMP) reported today.

Julian Wipper, the general manager of the New World Millennium Hong Kong Hotel in Tsim Sha Tsui, highlighted a recent five-month renovation of the hotel’s lounge and wine cellar aimed at drawing both locals and tourists.

Although Wipper did not disclose the renovation costs, he described the investment as "significant.”

The revamped cellar now features over 1,000 labels of rare and vintage wines, available at competitive prices.

This initiative is designed to offer a compelling value proposition for both local wine enthusiasts and visitors, encouraging them to enjoy dining experiences within the city rather than travelling to mainland China.

"The Lounge and Vin et Vin cellar is our creative answer to the currently challenging [food and beverage] market,” Wipper stated.

He added that Hong Kong’s favourable wine tax policy, introduced in 2008, allows the hotel to offer rare vintages at "exceptional value.”

However, the economic climate in Hong Kong has led to numerous business closures, particularly among retail and restaurant chains.

A growing number of residents are either choosing to shop and dine in mainland Chinese cities or are opting to cut back on spending following the pandemic.

For instance, health product chain CR Care recently announced it would close all 19 of its local branches, ceasing operations after 13 years.

Similarly, popcorn chain Garrett is shutting down its five branches, while restaurant group The Dining Room will close its last remaining venue in mid-October.

Recent economic forecasts from the University of Hong Kong indicate that the gross domestic product growth is projected to decline from 3.3 per cent in the second quarter to 2 per cent in the third, with a slight recovery expected to 2.4 per cent in the fourth quarter.

Despite this, businesses are diversifying their approaches to attract more customers.

Christian Talpo, CEO of Pirata Group, told SCMP of their collaboration with Artbridger to display purchasable works from emerging Asian artists across their 26 venues.

"It’s a good way to show people that we pay attention to details. We look at the details of the service, of the food, of the interior,” Talpo was quoted as saying.

The group has also revamped its food and service offerings, investing heavily in staffing, including hiring 20 new chefs and managers this year.

Additionally, Pirata Group is moving away from previously popular free-flow drinks packages, instead focusing on healthier alcohol-free options in response to a growing trend of health-conscious diners.

Despite experiencing a 20 per cent decline in year-on-year business across its three flagship brands — Pirata, The Optimist, and TokyoLima — following the reopening of borders, Talpo reported a gradual stabilisation.

Business levels have since reached only 5-10 per cent below pre-pandemic figures, with July showing a surprising 10 per cent increase in patronage compared to June.