The Feasibility of Opening the Sparkle Jewelry Retail Store in Hong Kong
The Feasibility of Sparkle Ltd’s
Opening Jewellery Retail Store in Hong Kong
PROBLEM
This study was designed to analyze and evaluate the feasibility and possibility of Sparkle Ltd’s idea to open a jewellery retail store in Hong Kong. Specifically, the study seeks answers to these questions:
* What is the opportunity for opening a jewellery retail store in Hong Kong? * What is the risk of opening a jewellery retail store in Hong Kong? * Do the advantages overweigh the disadvantages in this initiative?
BACKGROUND
CEO, Mr. Lee, authorized this study to examine the market and tell whether it is good time to open a retail store as the overall economy of Hong Kong is still strong. To achieve the goal, this study must identify and compare both the potential risk and opportunity of the investment.
Data for this report came from website of Hong Kong Jewellery Manufacturers’ Association and some secondary data on Hong Kong trade and development Council
DISCUSSION OF FINDINGS
Opportunity
1. Change in constitution of global demand for jewellery.
As a kind of luxury good, demand and price for jewellery are very sensitive and would fluctuate as economic condition changes. Since the financial crisis in the end of 2008, United States and Euro Zone have been trapped in serious recession; as a result, their demand for jewellery dropped dramatically, while originally the two economies consumed an unchallengeable majority of global jewellery. On the other hand, demand from developing countries like China, India, Malaysia, Thailand, etc. increases quickly, having strong potential to replace the dominative status of US and EU.
Figure 1 Area or Country | Growth rate of export value of Hong Kong Jewellery in2010 | China | 18.2% | Russia | 96% | Macao | 160% | America | 19.9% (recover gradually to former level while its proportion dropped from 35% to 31%) | Southeast Asia | 25.4% | Europe | 7.8% |
Source: Hong Kong Jewellery
Opening Jewellery Retail Store in Hong Kong
PROBLEM
This study was designed to analyze and evaluate the feasibility and possibility of Sparkle Ltd’s idea to open a jewellery retail store in Hong Kong. Specifically, the study seeks answers to these questions:
* What is the opportunity for opening a jewellery retail store in Hong Kong? * What is the risk of opening a jewellery retail store in Hong Kong? * Do the advantages overweigh the disadvantages in this initiative?
BACKGROUND
CEO, Mr. Lee, authorized this study to examine the market and tell whether it is good time to open a retail store as the overall economy of Hong Kong is still strong. To achieve the goal, this study must identify and compare both the potential risk and opportunity of the investment.
Data for this report came from website of Hong Kong Jewellery Manufacturers’ Association and some secondary data on Hong Kong trade and development Council
DISCUSSION OF FINDINGS
Opportunity
1. Change in constitution of global demand for jewellery.
As a kind of luxury good, demand and price for jewellery are very sensitive and would fluctuate as economic condition changes. Since the financial crisis in the end of 2008, United States and Euro Zone have been trapped in serious recession; as a result, their demand for jewellery dropped dramatically, while originally the two economies consumed an unchallengeable majority of global jewellery. On the other hand, demand from developing countries like China, India, Malaysia, Thailand, etc. increases quickly, having strong potential to replace the dominative status of US and EU.
Figure 1 Area or Country | Growth rate of export value of Hong Kong Jewellery in2010 | China | 18.2% | Russia | 96% | Macao | 160% | America | 19.9% (recover gradually to former level while its proportion dropped from 35% to 31%) | Southeast Asia | 25.4% | Europe | 7.8% |
Source: Hong Kong Jewellery