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We had exhibited at Hong Kong Jewellery & Gem Fair September 2018, held at the Hong Kong Convention & Exhibition Center, for 5 days from 14/09/2018 to 18/09/2018．
Currently, our industry is undergoing a major transition period and changes in the industrial structure are clearly appearing． For example, sales amount of real stores are declining due to expansion of EC, and it is believed that this trend will accelerate in the future．I think that products handled by our industry can be roughly divided into 2 categories; mass-produced products by planning, and single item with full of originality. Majority of the products in our industry are mass-produced items, and it is expected that the items in this field will become increasingly harsh in the future． I believe that as much information becomes open and easy to access, eventually it will be a price competition．
Among some manufacturers, they give up wholesaling these products to retailer, and sell them through EC． The advertising effect is great, has gained considerable popularity and deliver good result, by the method which find and uses influencers, who has great influence in cyber space like popular bloggers, to spread images or movies of products by smart phone．This trend has also appeared obviously at regular wholesale businesses and at the JJF site held the other day． The relationship between the supplier and the consumer has become smartphone- centric, and it is believed that new changes might come by continues use of smartphone.
The attraction of gold as an investment has diminished and the demand for platinum as a catalyst declines, the market prices of both metals have fallen and it has an impact on our industry. And now, here comes another problem which might affect also． That is diamond. De Beers announced to distribute lab-grown diamond form this autumn. Like natural diamond, this lab-grown diamond can be tested and graded by GIA which is an international appraiser.
Lab-grown diamond is made from pure carbon as same quality as natural diamond and it is said that it can be manufactured to a considerably rare color such as red and blue． It is inevitable that the introduction of lab-grown diamonds with natural quality and inexpensive prices will bring about a change in the diamond market．
The jewelry show held in Hong Kong this time seemed to have fewer visitors than previous year． September show in Hong Kong boasts the largest scale in Asia, which is very crowded every year, but it did not happen this year． It seems that China’s economy is declining due to the RMB depreciation and the trade friction between the US． Usually, Chinese buyers had been energetic to buy, but they were hesitating to purchase at this time．It seemed that they had enough stocks which were purchased before due to the bad sales． And they, only, wanted something very cheap, or new items which they do not have in their stock．
Another cause that the mood has deteriorated seems to be the impact of the EC which shows further expansion recently． People who have real shops said to me that ”Consumer could easily check information about products, prices, and sometimes they were sold through EC at the very low price．So, it became difficult to sell and make proper profit．” It made them pretty strict about buying．
Amazon as the lead, the environment has changed dramatically due to the expansion of EC and it started to see that many industries to be disappeared．According to this trend, changes in our industrial structure are becoming inevitable. In our industry, merchandise has been sold at the real shops but it is becoming difficult to survive just having a big store with huge inventory．
However, real store never goes away. Because, EC companies are constructing real stores one after another. But, these real stores are not old-fashioned． Software covers a considerable part of the store management in Amazon, such as Amazon GO store has no cash register．Also, EC companies that have grown in D2C are opening in showroom style stores. And it is creating a new trend called “show rooming”; a consumer actually sees and tries merchandise which is sold at EC, and after they could order by PC in the store or order by their self though internet. it is anticipated that EC companies would launch real stores in the new way like above in the future. In order for companies which are active mainly with real store to survive in the future, so called ”purchase experience”, which is exercised by Apple, Starbucks, NIKE and etc．, might be a hint. If there is no real shop and actual merchandise, EC itself cannot be established either. It seems that coexistence with EC or establishment of stores exceeding EC seems to be a key factor in the future．
In addition to the poor business confidence, Hong Kong was hit by a big typhoon on 16th during the jewelry show period． Many buyers left Hong Kong before 16th and exhibition was closed whole day. Also, local Hong Kong people seemed not to feel like buying jewelry because of this typhoon. Toward the end of the year, I think that the result of this jewelry show would influence in various parts in our industry. We would like to reconsider our service for our customer once more, and will strive very hard to work on it. Thank you very much for everyone who came regardless of the really difficult circumstances like this. And, we would like to express our sincere condolences to everyone who suffered from this typhoon．
