All that glitters

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In the words of specialists far and near alike, “Jewellery has the power to be ‘this one little thing’ that can make one feel unique.”

With consumers having the desire to follow trends and obtain the latest jewellery designs, jewellery companies will always have a perpetual market for their products regardless of  consumer type.

However, jewellery companies in Malaysia are now faced with an obstacle that may affect their sales next year, especially with the implementation of the Goods and Services Tax (GST) on April 1.

Some are confident the GST will not affect the jewellery industry although customers will be imposed a six per cent tax.

According to Saw Eng Hock, treasurer of the youth division of the Penang Chinese Heng Woh Goldsmiths Employees Union, although sales of jewellery are expected to decline 20 per cent to 30 per cent in the first two years of the introduction of the GST, demand for jewellery would stabilise afterwards.

“This is because the public think they will probably have to pay more for jewellery with the six per cent tax imposed through the GST.

“We are confident however that this would be only for a short period (the first two years), after which the country’s jewellery industry will return to normal and the people will get used to it after they really understand what the GST is all about and its benefits to the country and consumers,” he told Bernama.

In an email interview with the BizHive Weekly, Christine Lim, senior brand manager, marketing department of Tomei Consolidated Bhd (Tomei) said:  “The  GST will affect everyone and not just the jewellery market.

“We think the market will react by purchasing in advance before GST implementation to avoid paying six per cent GST.

“Come April 1, 2015, sales could slow down slightly as most customers have already bought in advance,” she said.

Lim explained that once the public gets used to the GST, they think the jewellery buying sentiment will return to normal.

Diamond & Platinum Sdn Bhd maintained a more positive outlook on the GST, with marketing manager Amanda Kuan highlighting that they believe by offering the right products with excellent service, the customers will come back.

Kuan added that the ones planning for weddings will still spend but they will be looking for the right jewellers and products that offer both good quality, services as well as great value.

As for Sarawak’s own KK Diamond Centre (KKDC), branch manager Kenny Sim admitted that they do not know the impact yet.

He thinks that once GST has been implemented, nobody really knows how well the system will run or how big the impact will be.

“But, if you are talking about that six per cent, well we are doing luxury items. If you add on the six per cent, it will be absorbed accordingly in the market,” Sim said.

As most are not certain of the effect of GST on the industry, Sim said that they will have to “wait and see next year”.

“I have checked with many people in the same industry, and they also say the same thing. Wait and see, see how it goes,” he said.

 

Tomei

Tomei Consolidated Bhd (Tomei), an integrated manufacturer and retailer of gold and jewellery, first started as a refinery business in the jewellery industry back in 1968. Back then, the group was involved in the design and manufacturing of jewellery and supplied to local jewellers.

Towards the 1970s, as business grew, Tomei opened its first retail outlet in Campbell Shopping Centre in Kuala Lumpur and subsequently commenced the business of wholesale and distribution of jewellery.

Initially, Tomei focused on gold jewellery and later brought the white gold diamond trend into the local jewellery retail scene. From then, Tomei started to expand rapidly in 1990s.

Today, Tomei provides a comprehensive range of jewellery from gold to white gold, gemstones such as jades, diamonds, loose diamonds, gold bars and even branded jewellery.

In its 2013 annual report, Tomei explained that the needs to cater for the demand of young and trendy lifestyle propelled the group to introduce My Diamond retail store, specialising in trendy white gold and diamond collections to the market in year 2002.

The following year, Tomei set up its own boutique under the name TH Jewellery to display its high-end range of collections.

Tomei kept itself busy in later years with more business ventures that involved bringing in more international brands into the country.

These included the successful acquisition of Le Lumiere, a renowned international brand for Hearts & Arrows Diamond in year 2007, which led to the group setting up its first Le Lumiere boutique in 2008.

“In 2011, the Group further added on another brand into its fold with the acquisition of Goldheart, displaying unique jewellery series for wedding collections,” Tomei said.

It did not stop there, as in February 2013, the first De Beers diamond retail outlet in Malaysia (exclusively managed by the group) opened its doors to the public.

According to Tan Sri Datuk Ng Teck Fong, group executive chairman of Tomei  (writing in the company’s 2013 Annual Report), this marked a significant achievement for the group as De Beers is always synonymous with the best diamond in the world.

“It also reinforces the Group standing as among the best in its league in the diamond and jewellery industry. In addition, the Group is also granted the option for the franchise right to set up and operate De Beers retail outlets in Singapore, Indonesia, Thailand and Vietnam,” Ng said.

From there on, Tomei continues to innovate and offer various offerings and designs to customers. This was especially the case with Tomei’s gold jewellery products.

An example is the introduction of “Ana-stasia”, which Ng explained is Tomei’s very own gold jewellery master piece design that adds on more  glitter to their existing collections.

In complementing these collections, Tomei also has the exclusive distributorship rights to sell 24k gold jewellery under the renowned brands ‘Batar Jewellery’ from China and ‘Prima Gold’ from Thailand.

Additionally, the group also has the licence to manufacture, distribute and sell gold products under the Baby Looney Tunes and Super Heroes copyright character in Malaysia from Warner Bros Consumer Products Inc, US.

In line with the increasing demand for gold investment products and general acceptance to the concept of e-commerce, Ng shared that the group introduced an alternative channel in delivering sales to its customers via GoldSilver2u.com, an e-portal specialising in gold and silver investment since 2011.

“The introduction of GoldSilver2u.com, the first e-portal of its kind in Malaysia, continues to reach out to customers using web-based services in securing sales,” he said.

Ng further highlighted that Tomei’s Jewel Club, the group’s customer loyalty programme which was introduced in 2011, has managed to register a large number of memberships while Tomei’s Facebook page has garnered a large group of followers.

Overall, Ng noted that Tomei is committed to improving on its retail business in Malaysia by continuously upgrading and refurbishing its retail stores to provide a fresh and conducive shopping experience for its customers.

“Despite the challenging environment, the Group is still discussing with mall operators to set up new stores in the new prominent and upcoming retail locations,” he said.

To date, Tomei has 71 jewellery retail outlets in Malaysia and 13 jewellery retail presence overseas within six major umbrella brands namely Tomei, My Diamond, TH Jewellery, Le Lumiere, Goldheart and De Beers.

On the Sarawak front, Christine Lim, senior brand manager, marketing department, Tomei told BizHive Weekly that while Tomei already has outlets in Kuching and Miri, if there are more good locations available in the state, they will consider opening up more outlets in Sarawak.

In regards to the current trends in the jewellery market now, Lim replied that the current market still revolves around the trend of white gold and diamonds.

She observed that rose gold and the combination of tri-color or dwi-color designs combining white gold, gold and rose gold to either match with diamonds or on the combination metals itself were the latest trends in the jewellery market now.

On Tomei’s consumer market, she said that the Group targets the mass market of consumers aged four years and above with their comprehensive range of jewellery.

According to Lim, Tomei believes in creative innovative designs and improving the techniques in jewellery making, as well as bringing more quality products to the local market.

 

Diamond & Platinum

Diamond & Platinum Sdn Bhd, (D&P), was first set up in 1999 and is a subsidiary of DeGem Bhd (DeGem).

DeGem is a multinational organisation with core businesses in manufacturing, retailing and design and distribution of fine jewellery. In addition, DeGem is a public listed company on the Main Board of Bursa Malaysia.

DeGem had noted that as at end December 2013, its market capitalisation was approximately RM114 million.

Focusing on D&P, Amanda Kuan, marketing manager of D&P explained that back then, when other jewellers were still selling jewellery the traditional way and focusing on selling yellow gold, D&P had foreseen upcoming trends and demand for white precious metals.

On its website, the group shared that back then, it started to notice that young adults between the age of 18 to 35 years were starting to develop a taste for contemporary jewellery in platinum and white gold and not the yellow gold of yesteryears.

Kuan pointed out that D&P thus created a new market and has since then focused on the distribution of its jewellery through shopping malls.

D&P is the pioneer and the first to introduce PT950 PLATINUM to the market. Kuan said that at the time, not many people understood the value of platinum.

“But today, we are proud to say we are the leader in the platinum category and carry the most platinum wedding bands in the market,” she said.

Currently, D&P is the number one brand in the bridal market. Besides providing the widest range of platinum wedding bands, D&P’s house brand Estrella Diamond are known by many in terms of having the best cut for maximum light returns.

Additionally, D&P is the exclusive jeweller for Forevermark diamonds, the brand owned by De Beers, in Malaysia and Brunei.

Kuan added that besides the above, D&P is also known for gift selections. On the current trends in the jewellery market, Kuan noted that they are now seeing more rose gold jewellery collections. As for diamonds, Kuan pointed out that they will always be popular choices in addition to some of the gemstones available at their outlets.

She highlighted that coloured diamonds like yellow, black, brown diamonds are getting very popular as well as onyx and enamel for fashion jewelleries.

Kuan said that there is always room for growth in the jewellery market.

“Unlike technology like smartphones and tablets, people buy jewellery due to its sentimental value besides the design and the monetary value,” she said.

Generally, she believes that buying gold and diamonds is also a good investment.

This is due to the fact that for gold price and diamonds price will always be sought-after assets.

Kuan also said that the bridal market is normally year round, but we are more busy second quarter and last quarter of the year.

D&P, which is exclusively available in Malaysia and Brunei, is constantly on a look out for good opportunities and potential markets, within the country as well as overseas.

As there is currently only one D&P outlet in Sarawak, Kuan said the company plans to open up more outlets in the state.

 

KKDC

KK Diamond Centre (KKDC), a jewellery company which first established its business in Kuching in 2003, has much to offer consumers especially with its wide range of products.

Prior to setting up its first outlet, the company had for a few years been hosting exhibitions in city hotels such as Hilton and the Grand Margherita.

Eventually, KKDC opened its first retail outlet at the Riverside Majestic Hotel in Kuching to cater to the city’s large untapped market for jewellery.  At the same time, it continued to host exhibitions in other towns in the state.

According to branch manager, Kenny Sim, since 2003 their number one best selling precious metal was the 9k white gold items.

These gold items such as pendants and rings consisted only of laser cut features.

“Back in 2003, 9k white gold was not so popular but now  it is very well accepted in the Malaysian market today.

“The product is as durable as the 18k white gold, the only difference being in the gold density.

“We still sell these 9k white gold jewelleries. It still sells well now,” Sim said, adding that KKDC also sells 18k white gold.

As for gems, Sim said, diamonds are still the best selling product to date, especially solitaire diamonds.

KKDC, which specialises in diamonds currently has a few kinds of certification for its diamonds. These include KKDC’s in-house certification and the other is the Gemological Institute of America (GIA) certification which comes from the US and which Sim affirmed is the best selling now.

He added that KKDC also sells diamonds that are certified by other international certifications such as the International Gemological Institute (IGI) and European Gemological Laboratory (EGL).

He said KKDC has its own “signature special cut” diamonds called the Simone Diamonds which were first introduced in 2010 and is currently popular with consumers.

“This is our own design, our own cutting with more emphasis on the hearts and arrow cut,” he said.

The Simone Diamond  basically consists of the hearts and arrow cut, where one will be able to see eight pieces of arrows from the top view of the diamond while from the bottom of the diamond one can see eight pieces of hearts.

He explained that this is KKDC’s signature product because it focuses more on the cut of the diamond.

“Diamonds can be very clean but without a good cutting, there’s no sparkle at all,” Sim said, reiterating that KKDC emphasises on the cutting.

He said with a good cutting, even though there will be a bit of compromise on the quality and the colour of the diamond, it will still give render the desired sparkle.

He said that Simone Diamond is selling quite well because as it has the perfect cut and still sold at a much lower price as those with GIA certifications.

Sim emphasised that as with their 9k white gold and Simone Diamonds, KKDC is very bold in going into new markets, and is always trying to improve its products and constantly trying to sell new items that are suitable for new markets.

Apart from the above items, Sim said that KKDC’s couple rings are also one of its popular jewellery among consumers.

According to him, for couple rings, there are only a few jewellery shops selling rose gold, adding that KKDC was one of the first to break into this market.

“Rose gold is very popular now and it is selling quite well here at KKDC,” he said.

He said there are actually not many jewellers who dare to sell rose gold jewellery because of the need for sales service.

Sim explained that after wearing the precious metal for awhile, if you want to re-polish the whole thing, it requires a specific set of technical skills to do so.

While this type of service is rare here, KKDC has its own factory which services rose gold jewellery.

Apart from diamonds, Sim said that gemstones such as blue sapphires and rubies are also selling well at KKDC.

He added that these sapphires and rubies will still be popular in the future, because of the contrasting colours of these precious stones. Customers will likely purchase these as they find that it is easier to match their dressing.

Regarding precious metals, Sim said that as rose gold is not being mass produced not many people can accept this metal yet. As such, he believes that in terms of the outlook for precious metals, 9k and 18k white gold will still dominate the market.

KKDC’s second full-fledged branch at CityOne Megamall (CityOne) which opened its doors last year is considered a good location  as it is situated in a high traffic flow with hordes of window shoppers passing by.

Sim added that the location of KKDC’s second outlet in the mall allows them to receive customers from all walks of life. He explained that being in a shopping mall, people do not necessarily go there to buy jewellery but because KKDC is easily spotted by passersby, they usually have the urge to walk in and take a peek at their products.

One of the reasons that KKDC opened an outlet at CityOne is because most of its regular customers actually live within a three kilometre radius of the shopping mall.

As such, Sim explained that with CityOne, the outlet can serve the customers living within that area. He noted that at the mall, they have customers from Serian and this is an achievement as previously it was harder to get them to visit their outlet at Riverside due to the distance.

He added that at the second outlet, they also receive customers from Indonesia who like to purchase KKDC’s 9k and 18k white gold.

Another reason KKDC opened up an outlet at CityOne is because it aims to tap into the younger market.

“Now the younger generation, they are going into the shopping complex, which have movies there, they have everything. So, we are moving into this market,” he said.

 

Angel Jewellery

Sim also highlighted that these consumers’ spending power is higher now as they are moving into this luxury lifestyle, and are thus willing to spend on jewellery.

It has also been observed that this younger generation, born in the 1980s and 1990s, are usually from the low to middle income group who would like to purchase jewellery without burning a hole in their pockets.

This led to KKDC’s idea of providing costume and fashion jewellery to meet this demand. Just outside of KKDC’s outlet in CityOne is a kiosk which sells these more affordable jewellery under a different branding, Angel Jewellery.

Angel Jewellery’s pieces consist mainly of jewellery which are of the silver metal and plated with white gold and that are designed to look similar to the genuine gems and precious metal pieces sold at KKDC.

Sim highlighted that pricing for all these plated jewellery is about 20 per cent lower than that of original white gold jewellery. With such prices, it allows the younger generation to afford looking good without overspending their budgets.

Angel Jewellery’s pieces range from rings, pendants, necklaces, most of which have been set with Austria or Swarovski crystals. Interestingly, some of these crystals have the same hearts and arrows cut that allow it to look like a genuine solitaire diamond ring.

One of Angel Jewellery’s latest jewellery is the Love Lock charms and beads bracelet, meaning a lock of love. These bracelets are priced at a range starting from RM99 to the most expensive piece which is less than RM300. The prices differ depending on the type and amount of charms and beads on the bracelet.

The charm collection comes in the form of different seasons such as the ‘Christmas’ collection which is becoming popular as it nears the festive month. They also have different theme and colour collections such as ‘Ocean’ collection which consists mostly of blue charms, the ‘Forest’ Collection (green coloured charms) and many more.

He said that these bracelets are imported from Korea and are currently selling like hotcakes. He explained that at first they were quite skeptical so they tried selling the RM99 designs first.

“After that, the response was so good, we started selling bracelets with more beads and charms, selling for RM200 plus and now it goes up to RM300 plus,” he said, adding that this is probably because of the trend of everyone now wanting to wear bracelets with charms.

Sim also said that they did not advertise this jewellery collection and that it was all just based on word of mouth among its new and regular customers.

He pointed out that it is still new in the market, having introduced it less than three months ago and yet it is really popular and in high demand.

Overall, as the younger generation’s income increases in tandem with their spending power, Sim affirmed that there will be an upsurge in demand for these constume and fashion jewellery.