4 May 2007
Sparkling Selection At Super Show(HKTDC Enterprise, Vol 05,2007)
Hong Kong International Jewellery Show
The sheer abundance of options made it hard to discern any overriding trends, with virtually all exhibitors at the March 6-10 event at the Hong Kong Convention and Exhibition Centre reporting healthy interest and strong sales.
"Our semiprecious line has picked up quite strongly because gold prices are high and diamond prices have gone up 30%-50% over the past several years," Diamrusa Ltd managing director Salil Shah observed. "Apart from blue topaz, citrine and amethyst, we're also seeing demand for stones like kunzite and moonstone."
Coloured stone jewellery accounts for about 70% of production at the Bangkok-based firm, whose most sellable unit-price range is US$300-3,000 FOB Thailand, with diamond jewellery the remainder.
"We sell medium- to high-end jewellery and focus on the design, finish and quality of the product," Shah said, adding that Diamrusa's range included simple and ornate jewellery, dressy and daytime jewellery. "We've seen growing interest in wearable jewellery."
Europe, Asia and, to a degree, the US are Diamrusa's major export markets. "We think China and India will potentially be big markets, and also Russia," Shah predicted. "We're developing Russia more than before."
A regular exhibitor, Shah said the Hong Kong fair is a must. "In the last few years, Hong Kong has become much more of a jewellery centre - it's become the spot in Asia," Shah insisted. "We're meeting a lot of international exhibitors here and our traffic is growing steadily."
Elsewhere, the classical Italian Renaissance styles of Il Brillante all' Occhiello, of Faenza, Italy, were apparent in jewellery that reflects Europe's cultural and historical traditions.
With designs drawn from ancient Greek, Roman and Etruscan mythology, the company's handmade pieces feature colourful enamels and a smattering of diamonds and precious stones set in sandblasted 18K gold.
Gold and enamel pendants, which sell for US$250-13,000 each FOB Italy, are among the firm's best-selling items, said owner Sergio Wollmann. "We produce 150-200 pieces of jewellery a month and don't do mass market," he insists, adding that his firm is also expert at micro-mosaic work. "A large amount for us would be to make six pieces of the same item."
A third-time exhibitor, Wollmann said his most enthusiastic customers came from Japan, the US and Australia. "Old customers come back and that is very good, but it's also important for me to find new customers and markets," he said.
He acknowledged that it might take time to generate overseas interest in the type of jewellery that his company produces. "We're here to introduce our products," said Wollmann, who believes that Asians like big stones and big pieces of gold rather than design but is confident tastes will change with time. "Being here has been paying off, so I'll come back a fourth time."
Meanwhile, the modern jadeite designs that represent about 70% of Shiu Lun Jade Jewellery Co Ltd's output are changing the appearance of this traditional Asian gemstone.
Rectangular slabs of white jadeite adorned with small, free-floating diamonds in a centre circle and flecks of green jadeite are a far cry from the Asian-style carvings that people typically associate with jadeite.
"We started doing modern designs in 2000 but not many people accepted them then," director Chan Kwok Man admitted. "In the last few years though, there has been more interest from people in Europe and we think this market will get bigger and bigger."
Jadeite colours other than green, such as black, white, lavender and pink, lend themselves to fresh, new designs, many of which are based on simple geometric shapes.
Shiu Lun Jade Jewellery Co Ltd's most sellable unit-price range is US$500-1,000 FOB Hong Kong for Europe and US$2,000 for other markets.
Parisian designs combined with precision-cut diamonds are the calling card of 5C-Jewelry B.V.B.A., based in Antwerp, Belgium, which concentrates on medium- to high-end 18K gold or platinum daytime diamond jewellery.
"We sell all types of jewellery but more rings and pendants," revealed owner Anuj Jasani. "We do a lot of pavm diamonds and centre stones from 20 points to one carat."
One popular model was a diamond ring with a solitaire diamond and pavm diamonds down the sides that sells for US$750-5,000 FOB Belgium, depending on the size of the diamond.
Most of 5C's exports go to markets in Europe and Asia, with the company's production centres in Shanghai and Guangzhou. "The future for sales is China and India, but we're also looking to develop North America," Jasani said.
Exhibiting for the second year at the fair in the design-intensive Le Salon Extraordinaire, 5C plans to return in 2008 and is also considering opening an office in Hong Kong.
"The fair is an important meeting place, but we've been far busier with our fixed appointments than our walk-in traffic," Jasani noted. "We could use a booth three times the size."
Also doing good business was London Pearl, which is based in London, England, and is one of the world's leading international pearl suppliers.
"Green, brown and gold colours and Chinese freshwater purples up to 15-18mm are selling well," said sales manager Daniel Vecht, adding that London Pearl specialises in unusual South Sea pearls, which means different colours, qualities and shapes.
The firm sources its pearls from Australia, Tahiti, Japan, China and the Philippines and exports its goods worldwide. "Ninety-nine per cent of our business is South Sea, Tahitian and large freshwater pearls," Vecht added.
He noted that "more and more" of London Pearl's customers were going for unusual colours. "Five years ago, demand for unusual colours and shapes was almost non-existent," Vecht recalled. "White pearls are still 30%-40% of our business, but that's not what's driving sales."
London Pearl, which sells loose pearls and strands, also maintains offices in Italy and Spain and plans to open a sales office in Hong Kong later this year. "We see Hong Kong as the market with the best potential," Vecht revealed.
Prices for South Sea, Golden and Tahitian pearls have been holding steady this year but there is concern that Chinese freshwater pearl prices will fall if there is too much production. "Competition from Chinese freshwaters has had a devastating effect on the Akoya pearl market," Vecht admitted.
However, if sales at the Hong Kong International Jewellery Show were any indication, London Pearl can look forward to a prosperous year. "We sold 40% more pearls this year than we did last year, and last year was a good show," Vecht beamed.
TEXT BY ANDREA PAWLYNA
Classic Choices For Canny Customers
Peter Engel was just one of numerous buyers who found themselves happily spoiled for choice at the Hong Kong International Jewellery Show 2007 in March.
The president of US-based Fred Meyer Jewelers Inc's shopping list included bridal jewellery, coloured stone jewellery and items worn on the right hand.
The firm is the country's third-largest jewellery chain with 411 locations in 36 states in the US, including well-known subsidiaries Littman Jewelers and Barclay Jewelers.
"We are very pleased with what we've seen," Engel said. "We're looking for innovative designs, new trends and vendors who would keep us ahead of the trends so we might be the first to introduce something new."
He had his eye on jewellery manufacturers from China (including Hong Kong), India and Thailand. "China and India especially have the ability to create things almost instantaneously," Engel maintained. "They have great design teams and can get things done at a fast pace."
Fred Meyer Jewelers offers a full selection of bridal, anniversary, coloured stone jewellery, watches and gold chains at retail prices starting at US$99 and ranging up to $15,000.
"We really focus on the bridal category," he explained, noting that the trend has been for "better-quality diamonds and centre stones that are a little bit larger".
"We see sizes going from half a carat to three-quarters and one carat," Engel added. "People still want the traditional round cut, but we're seeing demand for princess cuts and modified squares."
Following a record year for sales at his company last year, Engel was even more optimistic about sales in 2007. "Demand has remained high," he insisted. "Even with the recent stock market volatility, people always have to get married."
Engel was part of 60 buying missions representing 1,647 companies from the Americas, Europe, Asia-Pacific, the Chinese mainland and the Middle East descended on the fair, an increase of 25% over last year.
Fellow buyer Alexander Andryushkevich, general manager of Jewelland, of St Petersburg, Russia, was on the lookout for sapphire and diamond jewellery.
Founded in 1995, the holding company produces and wholesales its own jewellery, and operates 20 retail shops and five diamond salons in St Petersburg.
"We produce cubic zirconia pendants, earrings and rings and work with 300 agents on the wholesale side," Andryushkevich explained. "We sell not only our own products but also import from countries such as Italy and Turkey."
He said his company attracted affluent consumers, with jewellery selling for up to US$30,000, and noted that overall spending in both the retail shops and salons averaged US$1,000-3,000 per person.
"For an important occasion, they might spend more," Andryushkevich conceded, adding that his customers liked to buy diamond and sapphire jewellery, but they also wanted variety. "They want good quality and nice designs, but nothing too showy."
Russia's 18% tax on gold and raw materials, reportedly the highest in Europe, is an impediment to sales because it makes jewellery from Russia costlier. "We cannot be price-competitive," Andryushkevich said, recalling that in the days of the former Soviet Union manufacturers had to obtain their gold from the government.
A first-timer at the fair, he attended because of the growing trend among European companies to relocate their production operations to Southeast Asia. "The exhibition is very big," Andryushkevich exclaimed. "I didn't expect it to be so big!"
His goals were to make contacts with suppliers (particularly from Hong Kong and Turkey), investigate production operations in China and place orders. "I am hoping to find sapphire dealers and manufacturers who have good-quality stones," Andryushkevich said, adding that he planned to order US$30,000-60,000 worth of goods.
He was especially impressed with Hong Kong-made jewellery, describing it as possessing Italian design sensibilities, good quality and good production values. "Prices are lower than if you buy from Italian companies," Andryushkevich noted. "Ten years ago, it wasn't acceptable to import from China but now it is."
Meanwhile, family-owned Chilean firm Josm Fernhndez specialises in fine jewellery. "We make 80% of our jewellery and import the rest," explained Boris Fernhndez, owner of the Santiago-based company.
He said rings, mainly wedding rings, are the hottest-selling item at the company's three shops and diamond jewellery remains the most popular type sold.
Typical retail prices range from US$1,500-10,000, with white gold set with diamonds still the preferred style although yellow gold and even pink gold is available.
"We have a high quality standard and we are very glad to find that there are companies at the fair which have the same standards," Fernhndez declared.
He was zeroing in on suppliers from Thailand and China and believed demand would grow this year for more unusual materials, such as leather combined with gold and semiprecious gemstones.
Fernhndez had nothing but praise for what he called "a well-organised" fair. "I was very impressed by how attentive people were," said the first-time fair visitor.
Equally impressed was an Australian buyer whose company specialises in South Sea pearl and diamond jewellery and provides made-to-order pieces priced from US$4,000-15,000.
Melbourne-based Grounders Jewellers director Michael Grounds revelled in the wide variety of gemstones on offer at the fair. "We're looking for Colombian emeralds, sapphires and rubies from Thailand or India, Chinese freshwater pearls, and some Tahitian pearls and diamonds if I see good prices," the frequent visitor said. "Everybody's here that I need to see."
Established some 30 years ago, the company has evolved over the years from being known for its diamond engagement rings and diamond jewellery. "Our whole style has altered over the past five years and now we do a lot of different designs," Grounds explained, adding that his lines now include men's jewellery. "We used to sell small diamonds, but now there's more demand now for 1-3 carat diamonds."
One of the challenges he has had to face is the decreasing profit margin on diamonds. "Margins have come down over the past 10 years, and are 18%-20% now compared with 30% five years ago," Grounds noted. "A lot of diamonds are on the market and Internet selling has affected prices a lot, so I come to fairs like this to see if I can get an edge on prices."
Hong Kong is his destination of choice for fairs because it is geographically closer to Australia than Europe or the US, and about 25% of the merchandise he buys annually is sourced from the March Hong Kong International Jewellery Show. "I am eagerly looking forward to returning next year," Grounds concluded.
TEXT BY ANDREA PAWLYNA
Hong Kong jewellery exports will continue to grow, boosted by a dynamic Asian market led by China, according to a recent industry survey conducted by the Hong Kong Trade Development Council.
Exports to Asia-Pacific markets this year are expected to increase, according to 63% of the 420 exhibitors and 743 buyers interviewed during the Hong Kong International Jewellery Show 2007.
Elsewhere, 56% of respondents felt that jewellery exports to the US would better the 2006 totals while they expect the EU market to be stable this year.
The overall market outlook is optimistic, with half the respondents indicating they would increase both their orders and the quantity per order by an average 13%. Average unit-sourcing price is expected to increase by 12% in 2007.
Buyers said design, craftsmanship and pricing were Hong Kong suppliers' top three competitive edges, with more than 70% indicating "strong interest" in sourcing from Hong Kong over the coming three years.
Other survey findings include:
- the growth potential of rings is high, while rings and earrings and necklaces and earrings were selected as the two most popular jewellery set categories
- karat gold is likely to become more popular this year given the rise in the gold price, with white most popular followed by yellow and silver
- silver is becoming increasingly sought-after, while enhanced product design is helping keep prices buoyant
- diamonds stand out as the most appealing precious stone - especially solitaires in D-F/G-J colour, round cut and VVS/VS clarity - followed by pearls
- more buyers appreciate new micro-settings, while the majority still favour prong settings
- high-quality "A" jade, natural jadeite, is much better received than "B" or "C" jade
- classic and antique designs tend to be more favoured in the Asia-Pacific region
Most of the buyers and the exhibitors rely on Hong Kong trade fairs as the major sourcing or marketing channel, about half of Hong Kong exhibitors currently have or plan to have business operations in China, and the majority of the latter group will set up their own factories or distribution/wholesale business in China.
Lower production costs is the key factor for establishing factories, while proximity to Hong Kong and improved craftsmanship of mainland workers are also favourable inducements.
The rising purchasing power of mainland residents and proximity to Hong Kong are equally favourable factors for distribution or retail operations in China.
Hong Kong is the world's fourth-largest exporter of fine jewellery after Italy, the US and India, with exports of HK$29bn in 2006 representing robust growth of 13% on the previous year's figure.
Sales to Hong Kong's top three markets grew solidly, with the US up 7%, the UK climbing 11% and France surging 32% over the previous year.
Promising results were achieved in developing markets as well, with exports to the Chinese mainland, India and Russia jumping 47%, 83% and 209% respectively.
The Hong Kong International Jewellery Show 2007 continued to set the pace in the Asian exhibition industry by attracting record numbers of both exhibitors and buyers.
The 2,185 exhibitors from 41 countries and regions represented an 11% increase on the previous year, while the 31,004 buyers was a 6.01% improvement on the 2006 figure.
Those attending the extended five-day show at the Hong Kong Convention and Exhibition Centre from March 6-10 included more than 2,700 VIPs from 71 buying missions organised by the Hong Kong Trade Development Council, which also organised the jewellery show.
This year's show spotlighted a vast range of jewellery and watches in six zones, including the debut of the Antique and Vintage Jewellery section created in response to the demand for retro designs and the new Jade Jewellery section that showcased the classic luxury of jade.
Four popular, themed zones returned:
- Treasures of Nature - dedicated to top-quality loose diamonds, precious stones and pearls
- Le Salon Extraordinaire - featuring luxurious jewellery and quality watches
- the Watch & Clock Pavilion - offering more than 50 watch and clock brands
- Designer Jewellery Galleria - presenting the latest branded jewellery and designer collections from more than 40 companies worldwide
In addition, Les Salons Privms provided privacy and convenience for those wishing to conduct business at the 24th edition of Asia's leading jewellery show.
The strong international line-up included 21 group displays, with pavilions from Belgium, the Chinese mainland, Dubai, India, Israel, Italy, Japan, Korea, the Philippines, Singapore, Taiwan, Thailand, Turkey and the US, as well as first-time participants Germany, Malaysia and Spain.
Special displays organised by the International Coloured Gemstone Association, the Japan Jewellery Association, the Japan Jewellery Designers Association, and the Platinum Guild International added to the show's international lustre.
Pearl auctions were held by Paspaley and Robert Wan Tahiti, while Russia's largest diamond miner, Alrosa, hosted a rough diamond auction for invited buyers - a first for Hong Kong.
The winning pieces of the eighth Hong Kong Jewellery Design Competition and the sixth International South Sea Pearl Jewellery Design Competition were displayed to widespread acclaim.
Other attractions included the show parades featuring models wearing the latest jewellery and timepieces, as well as a series of topical seminars on issues ranging from jewellery trends and market opportunities to occupational safety in the jewellery industry.
TEXT BY ANDREA PAWLYNA