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Laopu Gold’s jewellery is selling like hot cakes despite tepid consumer spending in China

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Lubo GoldA jeweler appeared in Beijing, known for his manual accessories, as a favorite The wealthy consumersWhere luxury global brands such as Louis Vuitton and Gucci are wrestling with lukewarm consumer spending in China and slow sales throughout the region.

With only 36 stores in Greater China, the company listed in the Hong Kong list sold 3.5 billion yuan (482.7 million US dollars) of gold and fundamental jewelry in the first half of 2024, an increase of 148 percent over the previous year, according to what I said a year ago One, according to its temporary report. The net profit increased to nearly 200 percent to 588 million yuan during the same period.

Laopu Gold shares have risen by more than 550 percent since the company’s circulating company appeared, reaching its highest level Hong Kong ($ 58.7) on Tuesday.

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With the rise in gold prices Nearly a year ago and the remaining consumer morales were subjected to the slowdown of China, the demand for gold jewelry decreased in the collective market. Richard Lin, chief consumer analyst at SPDB International, said that the performance of LAOPU is “completely different”, because it “fully focuses on the high -end market.”

He said: “The wealthy consumers are not only affected by the broader economic conditions, but more importantly, unlike the normal consumer who buys gold as an appendix or for consumption, they also consider the investment value of golden products.”

LaPU’s success is partly attributed to its pricing model. Unlike the competitor Chao Tae Fook Jewelry – Which sells the largest part of its gold accessories based on a dynamic pricing model that rises and falls with the yellow metal – LAOPU follows the “fixed price” model, where the prices remain unchanged even though it involves a huge mark to reflect the complex company of the craftsman.

For laop, this means more profit. According to its temporary report, the company’s total margin was 41.3 percent in the first half of 2024, compared to about 20 percent of Chow Tai Fook.

“With the price of gold now about 600 yuan (82.30 USD) per gram and is likely to continue to rise, many consumers think, as we have to pay more brand and craftsmanship anyway, and we may also choose Laopu due to the quality of its products.” Lynn said. “This is mainly related to the brand’s authority.”

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