Heirs to the crown

Family business Fook Group is expanding its jewellery stores outsideHong Kong at a rapid pace, but insists it is still committed to its home cityAlong Kowloon's teeming Nathan Road, it is common to see multiple Luk Fook jewellery stores on the same block.迷你倉尖沙咀A top Hong Kong-based jeweller, Luk Fook Group has 1,189 shops around the world, with 1,132 shops (79 self-operated and 1,053 licensed) on the mainland, 42 in Hong Kong, 10 in Macau, one in Singapore and three in North America, with a newly opened store in Sydney, Australia, to cater to mainland tourists.But all of this is not enough for Danny Wong Ho-lung, the ambitious likely successor to the family business. As deputy chairman and executive director, the 36-year-old already plays a key role in helping the firm compete for the best store locations in Hong Kong, the mainland and abroad. He is also eager to "update" the brand so that it can keep up with the rapidly changing tastes of the mainland's rising middle class."In the future, I would want to see the company open more international stores to serve Chinese tourists travelling overseas," Wong said. "Our jewellery designs would have to change to appeal to the broader international community as well, but the focus will stay on mainland customers."Many of the leading jewellery companies in Hong Kong are facing a change in leadership, and the actions of the heirs to the city's colossal jewellery empires today may already be shaping the future of the gold and jewellery market in Asia. Their decisions could also help determine whether Hong Kong will continue to be a popular shopping destination for mainland tourists, or whether Hong Kong retailers will focus instead on opening stores on the mainland.Wong and younger sister Nancy Wong Lan-sze appear to be taking the pressures in their stride. They sit relaxed on a couch at one of their two-storey shops, overlooking Canton Road a week before Christmas, animatedly discussing plans for the company's future with their father.In 1991, William Wong Wai-sheung built Luk Fook from scratch after working as an apprentice at a small gold shop owned by his father. He recalls struggling to win the trust of early investors, mostly relatives and fellow jewellers. At 63, the affable chairman and chief executive continues to dominate at the company's public events, but today he is content to let his children do most of the talking.Danny describes the race among the city's top retailers to expand to areas closer to Shenzhen, where same-day mainland visitors increasingly prefer to do their shopping."We used to worry most ab倉ut securing the best locations in Tsim Sha Tsui, Mong Kok and Causeway Bay," he said. "Now we are looking to open stores near MTR stations in places like Sheung Shui and Tai Po in the New Territories. The mainland shoppers are going everywhere now."Danny joined the company in 2002 after getting his master's degree in business administration at the University of Toronto. He is responsible for the execution of the group's operations strategies and has developed a particularly strong interest in helping stores improve use of management information systems technology.Nancy, an executive director, joined in 2006 and is responsible for marketing policies and assisting in implementing overall business strategies. The 32-year-old has a master of science degree in China business studies from Polytechnic University.Despite the company's steady growth since the opening of its first store on the mainland in 1994, Luk Fook is an underdog compared to Chow Tai Fook, the world's largest jewellery chain, founded by Hong Kong's fourth-richest man, Cheng Yu-tung. Last month, Chow Tai Fook announced a 92.3 per cent year-on-year jump in profit to HK$3.51 billion for the six months to the end of September. Luk Fook also saw healthy profits, helped by a slump in gold prices and subsequent rush to buy gold products in April and June, but its net profit jumped a comparatively modest 72.9 per cent to HK$965 million. Other top competitors in the city include Chow Sang Sang, Prince and Larry Jewelry.Some analysts say the biggest test ahead for the future leaders of Hong Kong's jewellery companies could be to expand to smaller cities on the mainland.Luk Fook opened five self-operated shops on the mainland in the first half, including a 16,000 square feet flagship store in Wuhan in June."We opened our flagship store in Wuhan because a lot of universities are there, and it is the most populous city in central China with a lot of other populous cities nearby, so a lot of people pass through," said Nancy, who added that the average age of customers is between 30 and 40.But with all the talk about focusing on expansion on the mainland, their father continues to direct the firm's strategies, saying he has no plans to retire anytime soon. He insists Hong Kong will always play a central role in his firm, as well as in the region."Hong Kong is still one of the best places to buy and trade gold and other gemstones as there is no tax and the yuan appreciation attracts mainland shoppers," he said. "There is also a greater variety in stores here. Hong Kong will always have a jewellery industry."mini storage