Jewellery retailer Tse Sui Luen plans 100 new stores in China
Hong Kong jewellery retailer Tse Sui Luen (TSL) plans to open 100 stores in China over the next two years after solid growth in its existing store network.
It currently has 380 stores on the mainland, including 193 self-operated stores and 187 franchised shops. As well as planning new sites, TSL says it is focusing less on department stores there and more on malls in line with consumer shopping patterns.
Announcing a 21.3 per cent increase in sales group-wide for the last 13 months, and a 113.2 per cent increase in profit attributable to shareholders, TSL said it was also open to expanding its store network in Hong Kong as suitable opportunities presented themselves.
“Continued expansion of our retail network in all our operating regions is one of our key objectives both now and going forward,” the company said in its results announcement.
“With a cautious approach to monitoring the rental level and identifying appropriate business partners for our franchising business, we were delighted by the healthy growth in our store network in Hong Kong and Mainland China.”
Total sales for the 13 months (the group changed its financial year-end date from February 28 to March 31 this year) were HK$14.137 billion. Profit was $49 million.
In its home market of Hong Kong and Macau, TSL achieved a 19.5 per cent overall increase in same-store sales as tourists from the mainland returned to the territories.
Thanks to gold product promotions and enrichment of the brand’s product assortments, the average amount per sale increased by 20.3 per cent. TSL opened two new stores in Hong Kong, in New Town Plaza in Sha Tin and Yoho Mall in Yuen Long.
TSL says a growing demand for “daily jewellery products” and the continuing emergence of the middle class creates an opportunity to continue to develop its Mainland China business.
“Our self-operated stores continue to play a significant role as the group’s growth engine accounting for 39.3 per cent of the group’s turnover. However, … due to the shift of consumers away from department stores to shopping malls, we are undergoing a transition in the repositioning of our retail network to focus more on shopping malls and less on department stores.”
Despite the change, the company managed to maintain its sales at similar levels to last year and same-store sales growth was 10.4 per cent, (including the effect of an extra month in the figures).
The company also operates four stores in Malaysia, where sales grew 48 per cent. “We remain positive about this business and will continue to expand further in appropriate locations when opportunities present themselves,” the company said.