As Hong Kong's shops open their doors to millions of highly aspirational mainland Chinese customers, retailers are struggling to find the right staff to serve them.
Job vacancies for frontline staff in Hong Kong's retail stores are as high as 8.8 per cent, according to the results of a recent survey by the Hong Kong Retail Management Association (HKRMA).
At the same time, the number of mainland Chinese visitors grew by 23.9 per cent in 2011, with over 28 million of them - and billions of their yuans - coming to Hong Kong, largely attracted by the city's shops and low-tax retail regime.
"I don't know one retailer in Hong Kong, whether they are a luxury or a mainstream retailer, who's not looking for shop staff, or who doesn't have a problem with losing shop staff to competitors," says Dilal Ranasinghe, associate director, commerce and industry, at recruitment consultants Argyll Scott International. "This, in turn, causes wage inflation and a lot of volatility in the market."
"Retail staff with very strong Mandarin skills and a network of regular customers - mainland Chinese or Hong Kong customers - are probably the most `in-demand' skill sets in the luxury retail market," he adds.
This demand is being driven by a huge influx of retailers of all descriptions, says Karen Fifer, global sector leader, retail managing partner, consumer markets practice Asia Pacific, at Heidrick & Struggles. Demand is particularly high for candidates with experience of working amid a downturn, she adds.
"[The challenge is] finding candidates in marketing or any other function who have the capability of managing through good and bad times, because, unfortunately, in Asia, most of them have only known buoyant talent cycles, and buoyant shopping cycles - there's been no downturn in the China market," Fifer notes.
Senior retail roles have also become more demanding to cope with the complexities of the sector. "I think the job of the marketer has become very multifaceted, very strategic and, yet, very tactical, because to me, a true marketer looks at the entire supply chain - from how our brand is positioned all the way down to how we train our sales girls and our shop assistants to service our customers more meaningfully," she says.
"It's becoming a very complex job. I find that finding marketers in retail is getting tougher and tougher," Fifer adds.
Emmanuel Hemmerle, partner, Heidrick & Struggles' consumer markets in Shanghai, says that demands by mainland Chinese customers for excellent personal service are raising service standards across the sector, and may well set the standard for service in the future.
"One thing that many of our clients insist upon is that Chinese consumers have become among the most demanding in the world, especially if I take the example of service," he says.
"They will expect to be treated like VIPS. It influences the way service is designed, and the way it's executed," Hammerle adds.
These experiences are informing China's own retail standards, which could, in turn, influence the rest of the world, Hemmerle believes. "While China has mostly learned not so long ago from the West [about retail], it might not be so long before the rest of the world learns from China in retail terms [as well]."
Typically, mainland Chinese customers carry out extensive online research before purchasing, says Fifer, and retailers need to up their game to meet the shoppers' expectations.
"The Chinese consumer is very discriminating," she says. "The social aspect of learning about a product is very important, and this leads to marketing decisions about your website. Your website needs to be in Chinese, of course, if possible. All of a sudden, marketers and, indeed, most executives, now need to tailor their product to the Chinese customer, and there is much more of a need for market segmentation. For example, 'What does the consumer want?', 'What target market are we focusing on?' " Fifer says.
While Hong Kong retailers across the board are building China strategies into their planning, there are also challenges ahead for retailers, says Fifer. "How do you maintain your brand identity and your brand positioning when 30 per cent of your customers are suddenly homogenous?" she says.
Fifer says that the mainland customers in Hong Kong shop in a certain way - as a group, they arrive in tour buses. "There is also the need to protect your brand. I believe that this will be a concern," she concludes.