Creative designs and better-quality jewellery pieces are keys to driving the jewellery business amid continued macroeconomic headwinds.

According to Hong Kong jewellery manufacturers, companies should focus on design-centric initiatives, improving product quality and offering competitive prices to attract today’s discerning buyers.

Challenging times

The jewellery industry experienced strong sales in the beginning of 2023 as borders reopened, but growth was disrupted in the third quarter due to the Israeli-Palestinian war, explained Adam Lau, managing director of Able Jewellery Mfg Ltd.

“The impact of the conflict, coupled with the rise in gold prices, has resulted in a softening of the overall market. Buyers are more cautious and are exploring possible trends for next year,” he added. 

William Li, director of Chase Jewellery Mfg Ltd, agreed, adding that buyers are not in a rush to replenish their inventory. Consumer sentiment is also sluggish. 

“Consumer spending is closely tied to income, and ongoing geopolitical issues and interest rate hikes will inevitably impact consumers’ willingness to spend,” Li commented, noting that it may take years for the situation to improve significantly.

He said that given these challenging times, manufacturers should prioritise reducing costs, shortening the production time and ensuring early delivery of goods to customers, among others.

Creativity is king

Producing more creative designs that align with evolving consumer preferences is crucial to sustaining competitiveness, manufacturers said.

“Jewellery is intertwined with the fashion industry. If jewellery designs are not up to par or fail to meet market expectations, this can impact the overall business,” noted Lau of Able Jewellery. “So, manufacturers must not only focus on jewellery processing but also stay tune with the latest trends to remain competitive in the market.”

Modern designs are also enticing a younger generation of buyers who are now more inclined to wearing gold jewellery. This is fuelling growth in gold jewellery sales, he added.

Fancy cuts with special designs such as baguette are also in demand, Li of Chase Jewellery, revealed. Pave setting, which involves combining four to six smaller diamonds to create the illusion of a 1-carat diamond, is also gaining popularity among consumers. 

“This design is not only visually appealing but also more affordable compared to solitaire settings. This caters to the rising demand for more affordable pieces,” Li explained.

Pearls and coloured gemstones were the most popular product categories in 2023, according to the manufacturers. Additionally, there is notable increase in demand for lab-grown diamond products.

“Growth in pearl sales were mainly driven by the China market while demand in Europe and the US also grew gradually,” Able Jewellery’s Lau said.

Online market

Shanderson Jewellery Ltd, a company primarily engaged in processing jewellery for various brands as well as producing finished jewellery, has been proactively exploring new avenues to navigate a challenging business environment in 2023. 

Chris Yu, managing director of Shanderson Jewellery Ltd, said the company implemented a strategic shift in business direction. Instead of focusing on exporting to the Middle East and Indonesia, it is now targeting independent online jewellery boutiques in mainland China and Hong Kong. 

He said these online boutiques offer unique pieces of jewellery that are not mass-produced but rather meticulously crafted, “making each item truly special.”

“The widespread use of social media has significantly contributed to the emergence of numerous independent designers and small shops within the community. And the prevalence of livestreaming during the pandemic has changed consumer purchasing habits as people now buy online more frequently. We must update our strategies in response to this trend,” Yu commented.

Brilliant Diamond Jewellery Manufacturer Ltd, for its part, introduced its B2C brand, Any Jewellery, which takes advantage of influencer marketing by collaborating with Key Opinion Leaders (KOLs) to host livestreaming sessions. Company Director Yvonne Yip said this approach has proven effective in reaching a wider audience.

Amid challenges, Hong Kong manufacturers said they remain optimistic about prospects in 2024, adding that hope to have a clearer picture of where the market is by March 2024. 

“Business is expected to be stable next year, considering the upcoming US elections and the US government’s efforts to bolster the economy,” said Lau of Able Jewellery.