Food
Given the burden of rent in Hong Kong, most local retailers take their business online to skirt the financial and logistical hassle.
But Hong Kong startup PopScout is taking away the headache that comes with brick-and-mortar locations.
This online marketplace lets users book a pop-up shop online, choosing options for space, length of time and prices. The perks to having a temporary storefront are obvious: Foot traffic to generate brand awareness and customers physically interacting with products.
CEO and Founder Romain Aubert got the idea to start this model in Hong Kong while working as a research analyst in the UK.
“The short-term retail economy in the UK is a GBP2 billion [US$3.09 billion] industry and is much more developed. I did research into Asia and realized that it is a fairly new concept, there’s not that much information out. So I decided to come to Hong Kong and do more research [from the ground],” says Aubert.
Despite never having set foot in the city, French native Aubert moved to Hong Kong early this year. Aubert then applied and was accepted into Hong Kong’s blueprint, an accelerator and co-working space backed by Swire Properties.
This allowed him to fast-track his idea into a marketplace and build up the PopScout team to three.
“Hong Kong made sense because I knew could set up my business easily. It’s a big city for retail and real estate,” said Aubert, when asked about moving to a city he had never visited.
His goal now is to make looking for an offline store location as easy as booking a hotel room, or to “become the Airbnb of retail in Hong Kong.”
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A few stores in Hong Kong have already used the pop-up shop model to gain traction.
Perhaps most notable is Hong Kong-based apparel brand Grana, which started out as an online-only concept store. The e-commerce startup raised an additional US$1.5 million from investors in July of this year and talked to e27 about running a strictly e-commerce business in Hong Kong.
After successfully testing out a few pop-up shop locations including PMQ, an area in Central that caters to local retail shops, Grana opened its permanent ‘fitting room’ in Sheung Wan district. The fitting room does not stock actual merchandise but instead allows shoppers to try on clothing before placing the order online.
Rocket Internet-backed Zalora, also an e-commerce site, opened a pop-up store in Hong Kong’s Windsor Place in June, where customers could download the Zalora app and try items on, prior to ordering online.
Aubert initially scouted for locations in Hong Kong by walking around buildings, visiting shops that had previously done a pop-up model and had the chance of signing on a few.
“The landlords win as they can increase foot traffic through the pop-up stores and can max out occupancy levels, while pop-up shops can revive a space,” says Aubert.
Though PopScout is focussing its endeavours on just retail, Aubert says that there could be potential to expand into other industries such as F&B.
“Some people like the word disrupt. I don’t think we are disrupting anything because short-term retail spaces is not a new market. Our business model is very simple, just in Hong Kong there are less statistics in this industry,” says Aubert.
In the US, startups like Storefront and Liquidspace rent out work and retail space.
Within Asia, there are existing players around the corner, launching similar marketplaces with the same concept.
SpacesGenie, founded by Pushpendra Sharma is a Hong Kong startup that connects retail landlords with companies that want to set up temporary pop-up events. SpacesGenie lists event spaces available, including coffee shops and coworking spaces, in both Hong Kong and Singapore.
Other startups are also toying with the short lease idea, albeit in different sectors. FlySpaces focusses on short-term office space rentals and services cities Cebu and Manila and will start expanding internationally in December to all the ASEAN countries.
It is currently free to list on PopScout. The business runs on a transaction model, meaning that PopScout will charge a percentage for each deal.
