China's Gold Jewelry Chains See Franchise Store Closures Accelerate in H1 2026

Traditional gold jewelry chains in China continued to shed franchise stores in the first half of 2026, with several listed companies reporting net reductions of hundreds of outlets, according to Jiemian News. The biggest cuts included Chow Tai Fook, Lao Feng Xiang, Chow Tai Seng, Yuyuan, and Luk Fook, and the pace of store closures at Lao Feng Xiang, Chow Tai Seng, Yuyuan and Luk Fook was faster than in the second half of 2025. Jiemian News said the trend reflects more than weak franchisee profitability. High gold prices have raised the entry barrier for mass-market jewelry consumption and shifted buyers toward design and value for money, reducing the premium once attached to big brands. As brand gaps narrow, franchisees are re-evaluating whether the higher costs of joining a national chain still make sense, and some have switched from top-tier brands to lower-cost regional labels or to brands they see as more differentiated. The article said this has also led to a reshuffling of franchise networks rather than a full exit from the sector. Some franchisees in county-level markets have moved to cheaper regional brands, while others changed to listed-company brands in 2025 because of product differentiation. At the same time, brands such as Chow Tai Fook's peers are still expanding in some cases, including Chow Tai Fook's younger, smaller-ticket product lines and Chow Tai Fook's own efforts to balance channel contraction with self-operated stores and e-commerce in first- and second-tier cities. Jiemian News also noted that Zhou Liu Fu launched a joint-venture store model in October 2025, under which the brand and financially strong franchisees co-invest in higher-quality stores. The company said the model is intended to spread investment risk and encourage store openings. Meanwhile, the article said the recent pullback in gold prices in the first half of 2026 also weighed on demand for ancient-style gold products, with leading brand Lao Pu Gold seeing its revenue and profit growth slow from triple digits in the previous two years to double digits.