Gold jewellery retailers are refreshing their designs and accepting more trade-ins as they try to win back customers.
SINGAPORE: Gold retailers are refreshing their designs and accepting more trade-ins as they try to win back customers, after soaring prices made 2025 one of the weakest years for jewellery sales in recent times.
In Singapore, gold jewellery sales by volume fell 8 per cent year-on-year in the third quarter of last year, according to data from industry body the World Gold Council.
That decline, however, was offset by a sharp surge in gold investment demand. Purchases of gold bars and coins jumped 47 per cent over the same period, as buyers increasingly turned to bullion as a store of value.
The shift followed a strong rally in prices, with gold gaining more than 60 per cent last year, driven by robust investment demand and heightened global uncertainty.
HITTING RECORD HIGHS
Analysts expect prices to stay elevated in the year ahead.
The spot price for gold is currently trading around US$4,330 to US$4,400 per ounce, nearly double the price at about US$2,600 per ounce at the start of last year.
The highest price for gold per ounce reached about US$4,550 last month.
For retailers, the challenge is striking a balance between affordability and appeal, in a market where gold is increasingly viewed as an investment first and jewellery second.
Mr Ho Nai Chuen, president of the Singapore Jewellers Association, said investment-grade gold bars are Investment Precious Metals that are exempt from Goods and Services Tax (GST).
Mr Ho, who is also managing director at On Cheong Jewellery, one of Singapore’s oldest surviving Chinese jewellers, said this has influenced consumer behaviour.
“That prompted some of the consumers to pick gold bars rather than buying gold jewellery, so that they can preserve the value of the currency,” he added.
Retailers noted that even festive demand has been softer than in previous years, as consumers grow more price-sensitive.
With gold prices climbing, some customers are opting for pieces that are lighter in weight. Among them are retirees and elderly buyers, some of whom have been priced out of buying new pieces altogether.
As a result, more customers are selling or trading in old jewellery to capitalise on higher prices, said retailers.
OLD GOLD CASH-INS
To cope with weaker sales volumes, wholesalers and retailers are adapting their designs to maintain overall sales value.
“Right now, the consumers are looking for something lighter,” said Ms Chong Cui Xin, merchandising manager at G&J Goldsmiths & Jewellery.
“During these few months, we tried to bring in necklaces, bracelets (that are) less than 3g, which are more budget friendly for the consumers. (We are also) bringing in more hollow designs … to cater to the needs of the consumer.”
This marks a sharp shift from the past, when heavier gold chains were among the most popular items.
Analysts said part of the reason gold prices have remained elevated lies on the supply side.
Looking ahead, they expect gold to stay attractive to investors.
Mr Shaokai Fan, global head of central banks and head of Asia-Pacific at the World Gold Council, said gold’s appeal stems from its low correlation with other asset classes, giving it unique financial behaviour and strong diversification benefits.
“As a result, gold has a proven track record as a safe haven asset when there’s a lot of instability in markets, or when there’s a major black swan event or some sort of unforeseen event, like a new war or a pandemic starting,” he added.
“Gold traditionally does well when most likely at that time, the other components of your portfolio may not be doing as well, so it gives you a little bit more resilience in a portfolio too.”
