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IN THE CHAIR(HKTDC Jewellery, Vol 01,1998)

Vol.1 1998

- Aaron Shum

- Tse Sui Luen

Aaron Shum

THE Hong Kong Jewelry Mfrs' Assn (HKJMA) celebrates its 10th anniversary this year with a chairman who believes technological development is key to helping the industry grow and thrive in the 21st century.

"Traditionally, the jewellery industry has relied on handicraft skills that have been passed from one to another by experience. We need to improve the technological level involved in producing jewellery," maintains Aaron Shum, president of Aaron Shum Jewelry Ltd, who was elected on a two-year-term basis to head the 205-member strong association last June.

The association is promoting a number of projects to enhance technological development in the industry. CAD/CAM (computer aided design/computer aided manufacturing), master alloys and electroforming for platinum are among projects in the works.

"We also have a new project to refine and recover precious metals. Hong Kong jewellery manufacturers handle a lot of gold and platinum, and we need a good system to recover these from the working process in order to reduce wastage," Shum adds.

Training for all of these is being carried out at the Jewellery Industry Technology Centre, established in 1995, and is a joint project of the HKJMA and the Hong Kong Productivity Council.

Shum's extra responsibilities as HKJMA chairman mean his working days begin earlier and end later than they used to. "I used to come in at 10am and leave at 6pm, but now I start at 8:30 or 9am and I stay until around 7 o'clock," he says.

Before forming his company in 1985, he had had little previous experience in the jewellery business. "I'm an exception in Hong Kong. I don't come from a jewellery family and I hadn't worked for a jewellery company," he says.

"I went to Saudi Arabia to work for a construction company. When the project was finished, I started a general trading company and jewellery was one of my items. But I found it was better if I could control the production so I came back to Hong Kong in 1985 and started a small workshop in Tsim Sha Tsui with five people."

Today, his company's factory in Shunde, mainland China, employs 250 workers. The firm turns out low- to moderate-priced platinum and gold jewellery, priced from US$20 to US$500 per piece FOB Hong Kong. "This is our most saleable range, although we do have a few pieces for US$50,000," Shum says.

Recently, his firm has added diamond cutting and polishing to its repertoire. "It helps me control the material more directly and to cut costs. We are polishing rough and producing diamonds for our own jewellery. We've been concentrating on round cuts. In the future, we might include princess cuts and also consider selling the diamonds," he says.

Shum anticipates strong demand for diamond jewellery in the industry over the next year. "The consumption of precious coloured stones has decreased a lot in the past year. One of the reasons is that precious stone supplies are unstable. Five years ago, rubies were in scarce supply and prices went up. Now there are plenty coming from Burma and the price has dropped dramatically," Shum says.

Treatments and enhancements, he contends, have also deterred consumers from buying coloured stones. "Diamonds are easy to test and grade. So they are more popular right now," he says.

With the region still in the grip of a prolonged currency and financial crisis, Shum's optimism about sales this year is tempered by reality. However, he says Hong Kong manufacturers are adept at dealing with challenges. "Businesspeople in Hong Kong are quite flexible. They can move from one market to another very fast. If people who used to concentrate on markets in Asia find that that market has turned down, they can switch very fast to another market."

HKJMA is actively promoting its members' jewellery products in a number of ways, Shum says. It plans to organise delegations to 11 jewellery fairs in Hong Kong and overseas this year. It has also held its own jewellery exhibition in Hong Kong every December for the past two years.

Its jewellery Web site, the largest in Asia, was created to give buyers up-to-date information about what the association's members offer. In addition, the group has begun publishing a quarterly jewellery "catalogazine", being sent to 5,000 buyers worldwide, which puts the spotlight on new merchandise.

"Hong Kong is best known for medium to medium-to-high-end jewellery. Most companies operate their production facilities in [mainland] China where there is a tremendous amount of labour. Because of that we can handle everything from very low-end to high-end," Shum says.

Written by Andrea Pawlyna

Tse Sui Luen

TSE Sui Luen, founder and chairman of Tse Sui Luen Jewellery (Int'l) Ltd (TSL), was honoured last year as a Sovereign of the League of Honour by the Gemological Institute of America (GIA).

The League of Honour is the most prestigious recognition bestowed by GIA, a non-profit-making organisation, upon individuals who have dedicated their careers to the jewellery industry and carried out the mission of GIA, which is to secure the industry's future through improving educational programmes and conducting research and development activities.

Michael Sze, executive director of the Hong Kong Trade Development Council (TDC), presented the sterling silver and 18K gold League of Honour medallion, designed and handcrafted by the students of GIA, to Tse at a reception in Hong Kong.

The first Chinese person to be awarded the distinction, Tse says: "TSL has been working diligently to improve the quality, design and production technique of our jewellery for the past 30 years. Receiving this highly esteemed honour, I believe it is not only an appreciation of my efforts, but also an international recognition of the status of the Hong Kong jewellery industry."

TSL has the largest retail network in the Asia-Pacific region. It operates 22 shops in Hong Kong, plus five showrooms, and has 30 franchised stores in mainland China and another 21 spread across Singapore, Malaysia and Taiwan.

The company is best known for its medium-priced, mass market diamond jewellery. "We offer contemporary, value-for-money products," Tse says.

Tse, 62, founded the company in 1960 after working for seven years as an apprentice goldsmith. Starting out on his own, he had more than 100 staff members five years later. As his business prospered, Tse added fine, gemset jewellery to the company's existing chuk kam, or 24K gold, lines.

In the early days, TSL mainly produced jewellery for other retailers in Hong Kong. Eventually, Tse's factory grew large enough to need another outlet for its goods. By the early 1980s, TSL had become the largest jewellery exporter in Hong Kong, with the US and Japan its biggest markets. It became publicly listed in 1987.

The company began opening retail shops in 1978, but did not pursue retailing aggressively until the worldwide recession began at the end of the 1980s. Today, retailing accounts for about 90% of revenues. The company has factories in mainland China, Thailand and Hong Kong, and its total staff numbers about 1,900 throughout Asia.

"We define ourselves as a retailer now and we are very focused on making our retail chain world class," Tse says. "Our corporate vision is to continue to expand in Southeast Asia."

TSL is the first Hong Kong jewellery firm to sponsor its salespeople to take professional courses on diamonds and jewellery offered by GIA. It has also taken the lead in equipping all of its retail outlets with full sets of GIA diamond grading equipment as part of its Jewellery Consultant Service, which it launched in September last year.

"We have GIA-trained jewellery consultants in every store, over 20 in all. We are now sending a new batch of 20 people to GIA for training," notes Tse.

The object is to be able to educate and inform customers about the jewellery they buy, particularly diamond jewellery. "We have added a fifth C to the four Cs of cut, clarity, carat weight and colour. The fifth C is for consultant," he explains.

Elliott Yuen, executive director of TSL, adds: "This [service] has become a prominent and pioneering feature in jewellery retailing in Hong Kong ... and has received a very encouraging response from our customers."

In step with the times, the company has also moved into the hi-tech arena, using CAD/CAM (computer aided design/computer aided manufacturing) in its production operations. TSL has a computer-driven prototyping machine and jewellery repairs are conducted using laser technology.

TSL is the largest jewellery retailer in Hong Kong by volume and third in sales turnover. In 1990, Tse received the Hong Kong Entrepreneur Award for his accomplishments in the jewellery industry. He is also a member of the Jewellery Advisory Committee of the TDC.

Past recipients of the League of Honour include Nicholas Oppenheimer, of De Beers; Laurence Graff, of the House of Graff; Robert Mouawad, of Mouawad Joailliers; William Chaney, of Tiffany & Co, Inc; and Simon J. Critchell, of Cartier, Inc.

GIA is one of the world's leading educational and gemological research institutions, with campuses worldwide. GIA Hong Kong, the latest, was established in 1994.

Written by Andrea Pawlyna

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