Hengyang Recruitment Network
Keywords: Brand, Jewelry Brand, Brand Strategy
Dianliang Network (www.dianliang.com#) Report:
"The second and minute hands tick-tock in my heart, my gaze is dazzlingly vague, my heartbeat thumps with intermittent excitement!" This is one of the many songs sung by Hong Kong's famous singer Wakin Chau, titled "Someday I Will Marry You," filled with heartfelt trepidation, perfectly expressing the inner voice of a soon-to-be bride.
In China's jewelry enterprise franchise chain, "so vague" and "intermittent excitement" seem to explain some issues quite well. Even if not detailed, they can reflect certain phenomena. Over the years, Chinese jewelry brands have evolved from traditional front-store-back-factory operating models to franchise chains + self-owned brand direct stores operating models, and then to increasingly emerging online jewelry brand marketing. Each stage has countless stories to tell. Just doing a franchise chain brand or a self-owned brand requires analysis from both retail stores and manufacturing enterprises.
Constant conflicts and rising smoke
Since 1995 when jewelry companies started franchise chains, the jewelry industry has never been at peace with this new marketing model. After more than a decade, it feels like they've experienced both pain and sweetness, but in the end, they are still defined by insiders as being "at an elementary stage." Indeed, China's jewelry industry hasn't been focusing on branding for very long, so it's natural that franchising isn't yet mature. Local jewelry brands began large-scale promotions of franchise chains before their franchise systems were even perfect, resulting in low survival rates and unprofitable franchises, leading to conflicts and constant issues between franchisees and brand authorizations.
Many jewelry enterprises, when promoting their franchise brand strategies, often blindly operate based on nothing but written agreements and passion, without considering whether their own company has reached the stage where they can do franchising. Without any courtesy, anyone can produce a formal franchise manual. A planning department gathers information through various channels and can compile what seems like a perfect franchise plan. But we should realize that such plans are powerless and pale. Not only does your brand influence matter, but overall, whether the management of the company has the ability to control these operations is questionable. Jewelry enterprises doing franchise chain brands often imagine that simply listing a few franchise advantages will attract franchisees, and surprisingly, there are indeed some brainless franchisees willing to share the same future with them. It's like how many "hiking groups" organize people now. Joining us is no problem, but you need to understand our group rules first, and pay a fee upfront. So, to save time and effort, you willingly pay the money and follow their commands. Sometimes, you may even boast in front of others, saying that you're also a member of a certain "hiking group," unaware that precisely because of your dedicated actions, what ultimately succeeds isn't you, but this organized and planned "hiking group."
Although jewelry enterprises have such tendencies, the difference is that numerous franchisees and franchised brand enterprises have already awakened, and both sides have already begun verbal sparring. Franchisees complain, saying that doing this franchise chain brand requires not only initial investment funds for opening the store but also paying franchise fees, usage fees, and other costs stipulated in the contract according to headquarters' requirements. This makes us overly dependent on the resources provided by headquarters, while being restricted and monitored by the franchising contract, lacking a certain degree of operational autonomy. When headquarters makes wrong decisions, franchisees also suffer. On the other hand, franchised brand enterprises also express their grievances, saying that franchisees don't follow the rules, buying goods from other jewelry brands after joining ours, disrupting the market and severely affecting our brand's reputation.
The writer extracts a small news snippet, which reveals the franchised brand enterprise's frustration with franchisees: "... Because company-owned stores are uniformly supplied by the headquarters, while franchise stores often allow franchisees to independently select goods from the headquarters, the goods in franchise stores frequently differ from those in company-owned stores, affecting the company's brand reputation among consumers. Moreover, the discounting trend in the jewelry industry is getting worse. The company can uniformly control the retail prices of goods in company-owned stores, but franchise stores often cannot be controlled, resulting in quietly giving discounts on their own. These are things the headquarters doesn't want to see because random discounting affects the brand image, and brand is a crucial competitive advantage in a mature market." Ultimately, this piece of news informs us that a certain famous Hong Kong jewelry brand has resolutely canceled its franchise chain strategy that established hundreds of successful stores in mainland China, switching to its own-brand direct operation.
Compared to this famous Hong Kong jewelry brand, a famous diamond jewelry brand originating from Jiangsu has an even clearer stance. Initially, it claimed that it would open over 300 specialty stores in the Chinese market within three years, with more than three-quarters of them being franchised stores. However, just a year later, its CEO stated that they no longer planned to develop franchised stores. Not only that, but a famous jewelry group in Beijing chose to exclude "franchising" for its first sub-brand as well.
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