Hong Kong Jewelry Orders Plunge Due to Weak Europe and US Markets

Published on October 27, 2009 by Rebecca | This story has been viewed 843 views

As the financial tsunami has encumbered the global economy, consumers buy less and less high-grade consume goods in many areas. Worsened by the soaring cost of products, Jewelry Sector of Hong Kong (the world’s fourth largest exporter of precious jewelry) is facing sharp falls in orders and predicament in management. In this year’s Christmas season, the order will be decreased by 20% over last year. 

According to the report from Wen Hui Daily, although the financial tsunami has gone for more than a year, the consuming desire in Europe and US markets remains weak, so the order of jewelry will get a hard hit in Europe and US markets in the season of Christmas. The recovery of Jewelry Sector is going at slow pace, and its real recovery may come in the middle of next year at most.

Christmas-order is one of the important sources of income for the exporters every year. Under the circumstances that the overseas buyers are not with much prospect, there is a conservative desire to purchase jewelry this Christmas.

Wu Hong-bin, the advisor of the Hong Kong Jewelry Manufacturers’ Association (HKJMA), said that under the influence of the financial tsunami, the US buyers’ purchasing desire has dwindled drastically, so the Christmas-order might be plunged by 20 percent. At the same time, the buyers not only squeezed the price by 5% to 10%, but also extended the payment period to 90 days, which made many exporters feel dispirited and prefer to have the Christmas holiday in advance.

He said, “The business is really bad.” The Europe market is more heavily hit among the hard hit. Although the customers still see the sample and bargain, without enough confidence, they always hesitate to make decision when it is time to place order. He estimated that the Europe order would be down by 20% at least in the Christmas season.

Wu Hong-bin also quoted from his coterie who took part in the Jewelry Exhibition in Hong Kong that it was worrying that US customers were reduced by half this year.

He said that many manufacturers have got some sporadic orders in the Jewelry Exhibition, mainly due to customers’ little stock. However, the order was too small to make great compensation. Because the customers tended to purchase the inexpensive goods whose prices were below 100 U.S. dollars (139 Singapore dollars), there was only a limited help for the whole business, for it just made up one third of the whole orders. While the prospect of Jewelry was bleak, it still bought some good news.

Wu Hong-Bin revealed that the Russian customers, who have rarely placed orders in the past six months, started to see the goods and placed orders recently. Although the orders were small, it was a good start anyway. 

In addition, the Jewelry Sector disclosed that based on the past experience, as long as the pre-sales of Christmas season was ideal, the customers would soon place more orders. But because the manufacturers had limited stock, in case the customers sold perfectly well, many small factories might not be able to take those emergency orders or make-up orders, therefore it was likely that only those large factories with abundant capital and workforce might get more profit.

Shenzhen Post Rebecca Contributes to the Story.

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