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China Silver Group Establishes China’s First-ever E-Commerce Platform for Silver Jewelry and Accessories To Tap Huge Market Potential of Downstream Retail Business


HONG KONG, 7 January 2014 – Leading Chinese silver producer China Silver Group Limited (“China Silver Group” or “The Group”; Stock Code: 815.HK) is pleased to announce its entry into the downstream retail and e-commerce business. CSmall.cn, China Silver’s e-commerce platform for silver jewelry and accessories, commenced operations today. CSmall.cn will enter an in-depth partnership with e-commerce platforms such as Tmall, JingDong and others, aiming to become the most authoritative and professional vertically-integrated e-commerce platform for silver jewelry in China. 
 
CSmall.cn will adopt a B2B2C model to attract young generation as major target customers. Leveraging the Group’s advantage in mid-stream manufacturing ability, silver jewelry and accessories will be directly delivered from factories to end consumers to ensure quality. The Group will launch a series of its own brands, including "SIVO", a fashionable silver accessories brand online tailor-made for trendy and young consumer groups; “Zhen Hui Yin”, an online brand for silver products with designs that combined oriental culture and modern aesthetics; “Zun Fan”, a brand representing traditional and innovative oriental culture; and “Guo Yin Tong Bao”, a silver products brand which integrates traditional and modern style, and etc.. 
 
CSmall.cn will also introduce third-party silver accessories brands in the future with the aim to become a leading national open-platform. Furthermore, it will cooperate with Alibaba’s O2O platform, Weitao, as well as Jingdong. Meanwhile, CSmall.cn will also cooperate with the largest wedding and fashion brand operators at Tmall to showcase China Silver Group’s wedding series and men's accessories series to customers. CSmall.cn will become the first integrated multi-channel and multi-brand e-commerce platform in China. 
 
Mr. Chen Wantian, Chairman and Chief Executive Officer of China Silver Group, said, “In view of increasing consumption, jewelry accessories have been among the fastest growing consumer goods in China. As such, leading industry producers all see huge market potential in the demand of silver jewelry. At present, the market still lacks a leading silver jewelry brand that has an integrated industry chain in China. China Silver is one of the few silver producers who possess world-class silver production capabilities. Leveraging the Group’s strong capabilities in silver production, its ability to integrate industry resources, and together with its brand influence, silver retail business is expected to become another key source of revenue for China Silver Group in the future. This also marks another important step for us to become one of the leading integrated silver producers in the world. 
 
Rapid Growth Momentum in Consumer Market for Silver Jewelry and Accessories 
Among China’s three major economic growth drivers, consumption appears to gradually overtake fixed asset investment and export. Under this macro trend of growing consumption, jewelry and accessories are becoming one of the fastest growing consumer goods. According to data from the Gems & Jewelry Trade Association of China, domestic jewelry retail sales have been growing at a CAGR of 14% since 2006. Furthermore, with the volatility in gold and silver prices, there has been rapid growth in silver jewelry and accessories in the jewelry adornment market. Silver jewelry and accessories become the new favourites of jewelry retailers.
 
Silver jewelry and accessories, which account for 32% of silver retail spending in China, was the second largest category of silver retail spending in 2013. According to the International Silver Institute, retail sales of silver jewelry and accessories have made up 37% of total jewelry retail sales and become more popular among the fashion industry. Along with an increasing number of young consumers, silver jewelry which has lower selling price and better decorative functionality possesses great potential in China. Currently, per capita consumption of silver jewelry in China is still less than 2%, far below the double digit numbers seen in other Asian countries. Therefore, room for future growth remains huge.
 
To Fulfil the Brand Vacancy with Leading Position in the Market
Despite huge market potential in the retail of silver jewelry, due to factors such as inaccurate brand positioning, adverse impact from other precious metals and quality control issues, a leading silver jewelry brand is yet to emerge. As the only professional silver producer in China listed in Hong Kong, China Silver Group will leverage its brand advantage, the ability to integrate industry resources and its control over product quality to fulfil the downstream missing piece.
 
The Group’s advantage in resource integration can be seen in its ability to attract new talent. To ensure success in the downstream business, the Group has been proactive in strengthening its management team. The management team of the Group’s retail business has more than 10 years of experience in the industry. Furthermore, the Group also works with various industry authorities such as the China Academy of Art, and invites famous jewelry veterans to join as designers and consultants, aiming to build the most competitive R&D team in China.
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