Stud earrings

	Model ZZ-20 from Yiwu Zhizhen is a pair of post-back stud earrings with gold plating and CZ inlay.

Makers cut costs by exporting to markets with flexible plating requirements and using rendered images instead of prototypes.

Earring suppliers in China are implementing diverse strategies to reduce costs and stimulate demand. This comes as makers try to maintain viability while key export destinations are under economic pressure.

Some companies are exploring markets where plating requirements are not stringent in order to cut down on testing expenses. In particular, buyers in Africa prioritize low prices over the presence of nickel and lead in products.

When catering to these clients, suppliers purchase components without material safety data sheets. Incoming QC may also be omitted. They do not send output to thirdparty institutes for chemical inspection.

Nickel plating is applied in such cases. Even so, the amount is kept to 0.5 percent of the product’s total weight, the maximum allowable amount under China’s national standard for fashion jewelry. This is achieved by limiting the use of recycled metal from electronic waste, which may contain a high concentration of regulated elements.

The law, which came into force at the start of the year, prevents the export of models with excessive harmful substances. Offending makers are obliged to close for four months so that products can be brought to compliance.

Inspection is carried out by each city’s Bureau of Quality and Technical Supervision. Since the standard’s implementation, an estimated 5 percent of factories have been penalized, with 90 percent reopening.

Moreover, companies are maximizing their R&D budgets by keeping a tight rein on sampling activity. They continue to develop new designs and use rendered images for catalogs. Prototypes are created only when a customer has expressed interest in a particular entry.

In addition, suppliers are reducing their MOQ to attract business. Some are accepting orders of just 24 pairs per style, with a different minimum number of models per transaction. Prices are not as low as in large runs, but buyers avoid the risk of having excess stock of designs that are unpopular at retail.

There is a downside for makers. Outlay is higher when processing multiple varieties because of tooling fees and frequent reorganization of assembly lines. A few companies have even said they do not profit when operating in this manner. They prefer, however, to keep the factory busy and break even than forego orders and consequently shut down.

Suppliers are also hoping to boost margins as an effect of the increase in export tax rebates. On April 1, the rate for fashion jewelry was raised from 5 to 9 percent.

	Affinity offers model 21SW1551, post-back drop earrings with sterling silver or brass settings and findings.

China’s 4,500 earring makers shipped $325 million worth of products in 2008.

The number of industry players is shrinking. Last year, financial challenges forced an estimated 20 percent of companies out of business.

About 85 percent of enterprises are private locally owned while the rest are foreign-invested.

Small suppliers may have up to 200 employees and 10 assembly lines. Of these, two are designers whose main tasks are to improve on ideas from OEM buyers and make samples. All components are outsourced. QC involves visual and tactile inspection for correct and secure placement of stones, hooks and chains.

Factories with 200 to 500 workers are considered midsize. There are three to six R&D specialists who use Adobe Illustrator for developing original models. Casting and molding is done in-house, although plating is subcontracted.

The number of employees at large companies can reach 1,000. At least six designers launch new styles every day. Some makers have plating, and nickel- and lead-testing capability.

The main production hubs are Guangdong, Zhejiang and Shandong provinces.

Bold drop and chandelier earrings are dominating recent releases in China. Models are at least 5cm long.

Formal-looking styles have rhinestones set in goldplated alloy. Casual versions are made of either shell or wood in geometric shapes. These may be painted in different colors.

Makers are reducing the weight of the components in order to prevent earlobe damage. Metal parts are made hollow. Openwork such as filigree and ajoure is incorporated, which also contributes to the appeal of the product.

Besides drop and chandelier varieties, companies offer hoops and studs. They may have fishhook, clip-on, leverback and post-back closures. All kinds are available at different price ranges.

Quotes vary between $0.26 and $5 based on materials and craftsmanship.

Of the various types of metal, iron, and zinc and tin alloy are considered low-end. Midrange findings come in copper, brass and stainless steel while silver is high-end. For plating, rhodium and copper are the least expensive, followed by antique brass, silver, gold, and platinum.

Zinc alloy costs $1,900 per ton while brass is $3,970. Silver goes for $13 per ounce. A pair of sterling silver postback closures is $0.44 while fishhooks in the same material but plated in platinum are $1.30.

Low-end styles are decorated with plastic beads, feathers and shell while upscale models are adorned with glass, wood, mother-of-pearl, CZs, freshwater pearls and Swarovski crystals.

Most components are sourced locally, although some types of shell and rhinestones are imported.