1 March 2001
Hang Fung Gold Technology Limited (HKTDC Jewellery, Vol 01,2001)
Vol. 1 2001
TRADE DEVELOPMENT COUNCIL EXPORT MARKETING AWARD
TRADE DEVELOPMENT COUNCIL CERTIFICATE OF MERIT IN EXPORT MARKETING
Established in 1979, the company has grown from a small four-man operation to a publicly listed firm with five factories -- four on the Chinese mainland and one in Hong Kong -- and more than 2,000 employees.
Hang Fung specializes in pure gold (24K) and karat gold products, but also manufactures platinum, sterling silver and gem-set jewellery, as well as gold ornaments, figurines and other decorative items. Prices range from as little as HK$10 up to HK$30,000 (US$1.28-3,846) per piece FOB Hong Kong.
Over the years the company has invested more than HK$100m (US$12.82m) in computers, lasers and other types of advanced equipment, which has led to the granting of several patents.
Among the company's most popular innovations is its "3D Gold" technology, introduced in 1997. The process uses a laser to scan an object or the facial features of a living subject. The information is fed into a computer, which generates a prototype. The finished product is a hollow, lightweight 24K gold statuette.
Its latest innovation is developing the computerized equipment to mass-produce electroformed gold items in large sizes. An electroformed statue of the goddess Kuan Yin, which the company hopes will be recognized by the Guinness Book of World Records, stands 273cm tall, 145cm wide and weighs 168kg.
Says Lam Sai-wing, chairman and co-founder of the firm: "Before, other manufacturers could only produce these items by hand and they could only make several hundred pieces per year. Now we can mass-produce more than 2,000 pieces per day. The equipment allows us to control the temperature and the materials automatically."
The company's export strategy calls for diversification as a cushion against regional economic ups and downs. The Chinese mainland is Hang Fung's largest market, with a 21% share, followed by Europe, 20%; Southeast Asia, 19%; and the US and the Middle East, each at 16%. A network of importers and retailers carries out worldwide distribution of its products.
"We have quite an even distribution now, but we will be looking to develop India and to expand on the Chinese mainland over the next few years," says Lam. Hang Fung operates eight retail outlets in department stores on the mainland.
Much of the company's success is derived from its ability to design products that suit individual markets. "We do a lot of research on the culture, lifestyle, religion and the thinking in various markets. After we analyze the market, then we make products for that market," Lam says, adding that the company creates more than 2,000 new designs per year.
Revenues in the last financial year totalled HK$959.07m (US$122.96m), a 42% increase over the previous year. OEM accounts for about 70% of the company's sales, with ODM or private label making up the rest. The company's two brands -- Hang Fung 3-D Gold and, for its sterling silver lines, La Milky Way 3-D Silver -- are carried on 10-20% of its products.
Given its technological inclinations, it's no surprise that Hang Fung is moving rapidly to embrace e-commerce. "We are promoting our products on the Internet and we hope to focus more on B2B and B2C sales. We also hope to develop our own brand name on our Web site," Lam says.
The company utilizes a variety of marketing and promotional vehicles to publicize its products, spending more than HK$3m (US$384,615) a year. It participates in exhibitions, advertises in trade magazines, sends out direct mail and posts catalogues to consumers. It also plans to make a strong push into corporate gift and premium items, which account for 20% of the company's sales.
WRITTEN BY ANDREA PAWLYNA
Hang Fung Gold Technology Limited
2/F, Unit 25-32, Blk B
Focal Industrial Centre
21 Man Lok St, Hung Hom
Kowloon, Hong Kong
GIVEN that jewellery-making has a history that spans thousands of years, it is not easy to come up with products that are genuinely innovative. However, E & V Jewellery (HK) Limited has done just that by using specialist stone-cutting techniques, resulting in stunning jewellery collections which combine semiprecious stones with diamonds and gold.
The two sisters behind the E & V brand -- Ester Chan, who is the director, and Vivian Chan, responsible for design -- were born into a stone-cutting family. Their father had a factory that carved semiprecious stones and ivory into ornaments.
"When E & V was established in 1993 we tried using specialist stone-cutting techniques to produce something unique," explains Ester Chan. These techniques, especially when refined to the point of perfection that E & V demands of its artisans, enable the company to bring to market products that very few Hong Kong companies can produce. "We are pioneers in semiprecious jewellery," says Vivian Chan.
By using semiprecious stones, Vivian Chan has more than a thousand colours to play with, thus giving free rein to her imagination. The results are spectacular: E&V launches five or six new collections a year, and design inspiration comes from not just the world of fashion but also from interior design and the sights and sounds of foreign countries that Chan picks up on her extensive travels.
"I always make things in very bold designs, but also using top-quality manufacture," she explains.
Using semiprecious stones also has a market advantage. The seasonal peaks and slumps of the traditional gold and precious stone jewellery business are ironed out because E & V can always make more economical products for the traditional slow months, then step up the diamonds and gold when the big jewellery spending seasons roll around. The wide range of colours also enables the company to keep up with rapidly changing fashion trends.
"The market is changing every season and it's very hard for [traditional] manufacturers to keep up with such changes," says Ester Chan, adding that regardless of the changing fashions, E & V's commitment to quality remains the same.
"We can control the quality so well that the items you order are exactly the same as the sample. All the items are made by hand, and of course we have to really spend a lot of time training our staff on the Chinese mainland," she says.
Having developed unique products and honed its manufacturing technologies, E & V entered the Japanese market in the mid-1990s. From the start, customers were chosen carefully to protect the company's brand and image in the market. Entry into the Middle Eastern, European and North and South American markets followed.
Currently the company chalks up about 50% of sales worldwide from its in-house brands and aims to increase the proportion in the coming years, starting with a campaign targeted at high-end US department stores. The promotion strategy is comprehensive, keeping a uniformly stylish, glamorous and unique image for the company.
"Vivian and I are very actively involved in the way our company is marketed, including stand designs at trade fairs, brochures and so on. Hong Kong companies like ours are now working hard on their image and not just sitting back to be another subcontractor," says Ester Chan.
E & V's success can be attributed to its blend of unique cutting techniques, bold designs, high quality and strong brand image, but Vivian Chan is also keen to point out that every design and manufacturing decision is taken with one clear goal in mind -- making more business for E & V and for its clients.
"You can't just think about the company image, you've got to have the business too. Our products can make a profit for our customers and there is no real competition in the market," she says.
WRITTEN BY JANE PARRY
E & V Jewellery (HK) Limited
19/F, China Insurance Bldg
48 Cameron Rd, Tsim Sha Tsui
Kowloon, Hong Kong
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