By Louise Ho (China Daily)
Updated: 2007-09-26 08:57

HONG KONG: The smoking ban introduced on January 1 has resulted in reduced profits and fewer customers for 40 percent of restaurants here, a survey has revealed.

Commissioned by the Hong Kong Catering Industry Association (HKCIA) and conducted by Hong Kong Polytechnic University, the survey spoke to the owners and managers of 560 restaurants, cafes and related establishments, in which there is now a total ban on smoking.

Forty percent of respondents said sales revenue for the first six months was down on the same period last year. The same percentage said they had had fewer customers.

Establishments offering a combination of catering and karaoke were the worst hit, the survey found.

Of those, 75 percent said they had witnessed a decline in sales revenue, while 100 percent said they had had fewer customers.

Anthony Lock, managing director of karaoke group California Red Ltd, said yesterday that as a result of the ban, business was down 20 percent compared with the first half of 2006.

His venues were attracting fewer big spenders and more families, he said.

About 70 percent of the regular high-fliers - people who spend an average of HK$200 ($25) a night - were smokers, Lock said.

They drink more and stay longer than non-smoking customers, he said.

Most families visit during the promotional "breakfast karaoke" period and spend an average of just HK$30 per person, Lock said.

Smoking customers now prefer to go to Macao or the mainland, he said.

To help boost business, he said the karaoke industry had introduced a number of new ideas, including breakfast karaoke and offering a range of hymns for selection.

He said since the introduction of the ban, people tended to stay for only a couple of hours in the karaoke room and just an hour in the restaurant.

Tommy Cheung Yu-yan, the chairman of the HKCIA, said yesterday that under the current economic conditions, had the ban not been introduced, most eateries would have expected to achieve sales revenue growth of between 10 and 20 percent.

He urged the government to allow such premises to provide smoking rooms as well as non-smoking areas.

The head of the Action Group on Anti-smoking, Kwok Ka-ki, said studies carried out in California and New York had shown that smoking bans actually led to an increase in customer numbers.

However, he said smoking rooms should be allowed if they were suitably ventilated to protect the health of non-smoking patrons and staff.