Chow Tai Fook is reshaping its business strategy as it approaches its centenary, seeking to attract younger consumers and boost profit margins while navigating volatile gold prices and subdued spending in China. The Hong Kong-listed jewellery group, one of the largest in Asia, is revamping store formats, adjusting its product mix, and expanding overseas in a bid to sustain growth.
The company has begun shrinking its vast retail network, closing underperforming outlets and upgrading flagship locations. From a peak of more than 7,400 stores in 2024, the network was reduced to 5,813 by the end of 2025. Despite the smaller footprint, same-store sales in mainland China, which accounts for the majority of revenue, rose more than 20 percent in the December quarter. Overall retail sales increased 17.8 percent year on year in the fiscal third quarter.
Management says the transformation is helping the brand connect with a new generation of consumers. Operating margins have reached five-year highs, even as revenue growth has been uneven. A larger share of sales now comes from fixed price jewellery, which carries higher margins compared with traditional gold by weight products.
Soaring gold prices have added complexity to the strategy. With spot gold hovering near record levels, Chow Tai Fook has raised prices on gold products multiple times over the past year and may consider further adjustments. Elevated prices have encouraged some consumers to view gold jewellery as an investment, while others have become more cautious about discretionary purchases.
To manage this balancing act, the company is broadening its portfolio. At the premium end, it launched its first high jewellery collection aimed at affluent shoppers seeking rare and exclusive pieces. This move positions the brand alongside international luxury names and responds to growing demand for domestically branded high-end products among wealthy Chinese buyers.
At the same time, Chow Tai Fook is introducing entry-level offerings designed to appeal to younger customers. New products include themed gold accessories tied to cultural events and collaborations with global entertainment brands. Partnerships with sports leagues and gaming franchises are also intended to strengthen the company’s relevance among millennials and Gen Z consumers.
The jewellery maker’s share price has surged over the past year, reflecting investor confidence that the brand overhaul is gaining traction. Analysts note that improving same-store sales and higher-margin products have helped offset weaker overall consumer sentiment in China.
Beyond its domestic market, Chow Tai Fook is accelerating international expansion. Recent openings in Thailand and Singapore are being followed by plans for additional stores across Southeast Asia, as well as in Australia and the Middle East. While overseas growth offers diversification, analysts caution that jewellery is a culturally sensitive and high-value category that may take time to build momentum outside China.
As the company looks toward its 100th anniversary in 2029, its strategy centers on blending heritage with innovation, maintaining its core gold business while building a more diversified and higher margin product mix to support long-term growth.
