Lazurde announces sales strategy for gold jewelry by piece, mulls e-commerce growth

Lazurde Co. for Jewelry announced a revised strategy to grow and expand into selling gold jewelry by piece, at affordable prices, through its new brands and collections, Miss L’ and L’azurde Instyle in Saudi Arabia and Egypt.

The company said in a bourse statement that the step follows the company’s efforts to diversify and expand its revenue streams by adding new brands and entering new channels to address the latest changes in consumers’ preferences, shopping behavior and the high gold price level.

This is a significant development in the company’s strategy, which in the past, relied mainly on selling gold jewelry by weight in the traditional gold souks.

The new brand - Miss L’- is currently sold in the existing Lazurde stores and kiosks in Saudi Arabia and Egypt, in addition to some third party retailers in malls. The firm intends to open dedicated Miss L’ retail locations in the Kingdom and Egypt in 2021, it said, adding that the financial impact of opening new stores and kiosks will be reflected as of Q1 2021; however, it is difficult to quantify at the moment.

Meanwhile, L’azurde Instyle will be sold by piece in the traditional gold souks through a large network of third party retailers. The firm indicated that there are no plans at the moment to open dedicated stores for L’azurde Instyle collection, noting that the financial impact of introducing and selling L’azurde Instyle products will be reflected as of 2021.

Lazurde will pursue developing its traditional wholesale business selling jewelry by weight, and the business is expected to have a lower share of the company’s revenues and profits over time.

This is a reflection of the move of consumers’ buying trends from traditional gold markets to modern markets in malls and the shift from buying heavy weight jewelry by weight to buying fashionable and classic affordable gold jewelry by piece, the statement said.

This will help the jewelry maker to reduce its working capital and its associated high cost of financing.

Lazurde also successfully launched its e-commerce platform with Miss L’ and will undertake a major online expansion through more brands and entry into the leading market places.

The contribution of the e-commerce in revenues and income is still not significant but is growing fast, Lazurde said, noting that it will continue to expand and grow the development of e-commerce and presence on regional market places, given the significant change in shoppers’ behavior towards purchasing online.