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Analysis Of The Development Status Of China's Jewelry Industry In 2018 And Forecast Of Industry Development Prospects
Jul 02, 2018

Analysis of the development status of China's jewelry industry in 2018 and forecast of industry development prospects


The manufacture of jewellery and related articles refers to the production of various patterns by processing precious metals such as gold, silver and platinum and their alloys, as well as diamonds, precious stones, jade, jade, pearls, etc., through metal processing and joining, inlaying and other processes. The production of decorations.

At present, the concentration of jewelry industry in China is relatively low. There are 18,000 jewellery retail companies in the country, with a total of 64,000 stores. Most companies are small and their brand awareness is not high. And the domestic jewelry brand market is higher in the region, which shows that the domestic jewelry industry is still at the initial stage of development and the company leading the industry has not yet formed.

I. Analysis of the development status of jewelry industry

1, jewelry market potential

At present, China has already leapt to the top of the world from only 1% of the world in previous years, second only to the United States and Japan. The size of China's jewellery and jade jewellery industry has grown from RMB 220 billion in 2009 to RMB 670.7 billion in 2017. It has become one of the countries with the most significant growth in the global jewellery and jade jewellery industry. It is expected that in 2018 China’s jewellery market will reach 722.7 billion yuan.

2013-2018 China Jewelry Market Size Trend

Source: Public information

2, gold jewelry market development

In 2013, China's gold consumption exceeded 1,000 tons for the first time. In 2017, China's actual consumption of gold was 1,809.07 tons, and gold consumption remained the world's number one for five consecutive years. Among them, gold jewelry 696.50 tons, an increase of 10.35%. With the opening of the market and the improvement of living standards, the demand for jewelry for Chinese people continues to grow.

China's Gold Consumption in 2011-2018

Source: Public data collation

Trends in gold use of gold jewelry in China in 2011-2018

Source: Public data collation

3, diamond jewelry industry development

With the development of China's economy and the change of consumer attitudes, diamond jewelry is being accepted by more and more consumers. In 2011, China became the world's second largest diamond consumer market after the United States. Currently, China is the world's largest diamond jewelry processing site and the second largest diamond polishing site.

Trends in diamond trading volume of China Shanghai Stock Exchange in 2010-2016

Source: Public information

Second, the jewelry industry development prospects forecast

(1) Favorable factors in the jewelry industry

1. Increased concentration in the jewelry industry

The financial strength and brand influence are crucial to the development of the jewellery brand companies and are the basis for their expansion. Since ordinary consumers are difficult to identify the quality and value of jewellery, most consumers can only rely on the popularity and trust of jewellery brands when purchasing jewellery. Therefore, for jewellery companies, the stronger their financial strength and the higher the reputation of the brand, the more they can directly drive the increase in product sales. This has led to the accumulation of the market share to well-known brands and the increasing concentration of the industry.

2. The market construction of the jewelry industry is gradually improved.

In order to further standardize China's jewelry market, the government and industry associations have successively issued a series of industry standards and norms. This series of national standards and industry norms has established a good institutional platform for China's jewelry market. At present, China has become one of the countries with more comprehensive jewellery standards in the world, which is the entry of Chinese jewellery enterprises into the international market. It has important significance. At the same time, the China Jewelry and Jade Jewelry Association, the World Gold Council and other industry self-regulatory organizations actively provide guidance and services to enterprises, which have greatly promoted product quality assurance, quality appraisal and communication and cooperation, and boosted the market towards a benign state. development of.

3. The rise of custom jewellery

Along with the continuous improvement of the quality of life and self-awareness of the people, and the sudden emergence of consumer groups after the 80s and 90s, consumers pay more attention to the personality and fashion of jewelry, and hope that the design of jewelry can better reflect their emotional sustenance. Customized jewellery has become a fashionable choice driven by a wave of personalized consumption.

(I) Unfavorable factors in the jewelry industry

1, Macroeconomic down pressure

Jewelry, especially the diamond jewelry industry, is a typical high-end consumer goods industry. It is obviously affected by the macroeconomic cycle and is basically consistent with the periodicity of national economic growth. China's economic development has entered a new normal, the growth rate has slowed down, and the downward pressure on the economy remains large. The competition in the jewelry and jewelry industry has intensified.

But in jewelry, gold jewelry is different because it has functions such as decoration, preservation, and collection. At the same time, the reverse relationship between the price movement of gold and the trend of the US dollar also makes the match between gold jewelry and macroeconomic cycle relatively. Not high, this also reflects the gold hedge risk function.

2, raw material prices fluctuated

As various enterprises in the jewellery industry need to maintain more inventory in production and sales, the fluctuation of raw material prices has a greater impact on jewellery companies. When the price of raw materials such as gold and diamonds rises, due to the low cost of the current holdings of inventory by the enterprises in the industry, it has a positive impact on the profits of the industry; when the prices of the above-mentioned raw materials fall, the current inventory costs of the enterprises in the industry are relatively high. Industry profits have a negative impact. The price fluctuations of raw materials have brought certain operational risks to jewellery companies.

3. Increased operating costs affect corporate operating profits

The offline channels such as shopping malls are the main places for jewelry sales in China. With the continuous advancement of urbanization in China, land resources are increasingly scarce, and terminal stores near the core business districts of various cities have become the object of competition among various manufacturers. The continuous improvement of the actual operating costs of enterprises such as rental costs, labor costs and marketing costs continues to affect the profit level of jewellery companies.

4. Single financing channel

The business development of the jewellery and jade jewellery industry requires a large amount of capital to be laid, and the larger the size of the enterprise, the greater the demand for its underlying funds. At present, only a few well-known enterprises in China can be financed through the capital market. Other enterprises can basically meet the business development needs through indirect financing methods such as bank loans, and the financing channels are single.

In 2011-2014, the sales revenue of China's jewellery and related articles manufacturing industry has maintained a growth rate of more than 15%. Among them, the sales revenue in 2014 was 390 billion yuan, a year-on-year increase of 16.16%. From January to September 2015, sales revenue reached 270 billion yuan, a year-on-year increase of only 2.82%. In 2017, the sales revenue of China's jewellery and related articles manufacturing industry will reach 440.8 billion yuan, and the compound annual growth rate will be 6.18% in the next five years (2017-2021). The sales revenue of China's jewellery and related articles manufacturing industry in 2021. It will reach 50.6 billion yuan.

Forecast of sales revenue of Chinese jewellery and related articles manufacturing industry in 2017-2021.

Source: Public data collation

In 2014, the total profit of China's jewellery and related articles manufacturing industry was 12.5 billion yuan, a year-on-year increase of 41.25%. From January to September 2015, the total profit reached 6.3 billion yuan, down 10.51% year-on-year. It is estimated that the total profit of China's jewellery and related articles manufacturing industry will reach 10.25 billion yuan in 2017, and the compound annual growth rate will be 3.70% in the next five years (2017-2021). Total profit of China's jewellery and related articles manufacturing industry in 2021. It will reach 11.85 billion yuan.

Forecast of total profit of China's jewellery and related articles manufacturing industry in 2017-2021.