Foo Bao
FOO BAO SDN BHD
SUMMARY
Established in 2017, Foo Bao jewellery was created with an ambitious aim, to start a revolution from an outdated jewellery domestic market and transition it into a new modern and exquisite jewellery market. Foo Bao Jewellery is the most reputable jewellery company in Penang, Malaysia. We are well known because we provide the most fashionable and modernized exclusive gold jewellery you can only find only here. Foo Bao jewellery not only offers a wide range of jewellery, from bracelets, brooches, necklaces, and rings, but also provides the best customer services for all our clients. We strive to create jewellery with innovative designs and a huge emphasis on design excellence, which is why we are renowned for the delivery of an extraordinarily extensive collection. Foo Bao jewellery is committed to bringing the highest quality of product and services to every client.
Highlights
Foo Bao stands as one of the best gold jewellery manufacturers in Penang, the nation’s hub for gold jewellery fabrication. Our signature statement designs have been featured by Penang Signature Gold, the nation’s most prestigious gold jewellery trade fair which sees jewellery enthusiasts and meticulous gold traders alike vying to see the latest designs in the market.
Our clients include Poh Kong, Habib, Emas Anuar, DSV, and a collection of small-medium gold jewellery retailers from across 11 Peninsular states. Our company has proven time and time again that our operations, from fulfilment to artisanal creations, can hold up to the big names of more seasoned industry players despite our relative youth.
We are the only gold jewellery manufacturer in Penang to provide an e-commerce platform for wholesale transactions. Industry 4.0 calls for the evolution and adaptation of our business processes, and Foo Bao has been quick to the call by homing in on the enhancement of efficiency and business efficacy with regards to order fulfillment, stock viewing, logistics etc.
Our private inbound/outbound logistics division is allocated a highly sophisticated security detail to ensure our products are safely delivered to our clients. Additionally, our operations are insured against loss to limit risk exposure for all parties.
Foo Bao sales volume is rising congruent to global demand for gold jewellery, having grown over 2000% between our inception in 2017 to 2021. As the value of the global gold market is projected to rise with a CAGR of 8.5% from 2022 to 2030, we are confident in our ability to secure a large portion of the US 518.9 billion industry.
Our goal for 2022 to 2024 is to increase the capacity of our operations with minimal capital expenditure. As of today, Foo Bao occupies 80% fabrication capacity in our affiliated manufacturing facilities. With the funds raised we aim to acquire 100% of all manufacturing capacity coupled with an increased budget for marketing strategies and design output to capture a larger market share, both locally and in foreign markets.
PROBLEM
Gold but Old
The gold industry is one of few traditional and artisanal industries that have a rich history. Most retailers and wholesalers have been in the business for several generations, keeping to small volumes and smaller client bases. However, this presents a significant obstacle for businesses that favour the old ways of doing things as the world shifts towards digitalization for more efficient transactions. Pen and paper methods of maintaining business operations such as record keeping and inventory management will inevitably limit business volume and the efficiency of completing client transactions.
Lost Jewels of Malaysia
The concept of jewellery stems from the desire to set one’s individuality apart from the masses. However, despite being a melting pot of culture, our identity has not been shown through our jewellery designs. From big names to small enterprises, jewellery designers have yet to truly explore the frontiers of uniquely Malaysian statement pieces, usually falling back on the safe but time-tested contemporary designs. As time goes on, statement pieces of immense historical importance such as Intan jewellery, Jadau necklaces, and Kerosang Bintang brooches will be consigned to history. In the end, Malaysia will have loss its chance to showcase not only our identity, but the skill of current and future jewellery artisans that could have placed us on the world stage next to the likes of Tiffany, Cartier, or Buccellati.
Preference for International Designs Lead to Net Trade Loss
Within the international community lies a trove of precious and dainty designs that many Malaysians find it irresistible. This has resulted in the oversight of local jewelers who have had their designs overlooked in favour for more well-known brands. In 2020, the total export of gold in Malaysia had been dwarfed by the number of imports, worth RM 259 million and RM 2.27 billion respectively. Evidently there is a vacuum in demand for unique designs that is not being fulfilled by our local artisans, resulting in a net loss for the industry.
SOLUTION
Digital Processes: The Next Evolution
As the next evolution in the gold industry, Foo Bao has focused our efforts to change the landscape within whoich gold retailers and wholesalers conduct their business. Making the change from utilizing conventional, less efficient business operations to adopting and adapting to modern technological advances, we are able to double our servicing capacity. From barcode inventory management to online corporate retail services, our clients enjoy our service at the highest levels of efficiency, making Foo Bao fiercely competitive and a business of the future.
Breaking the Mold with Bold Designs
Our designs are specially curated from a master artisan with over 22years of industry experience. As a specialist in curating and marketing gold statement pieces, Foo Bao has brought attention away from “safe” and “timeless” jewellery to bold and unique designs that have taken the public by storm. Our designs on brooches, necklaces, rings, and bracelets have been inspired by both contemporary and traditional sources, paying tribute to the culture and history before their time while stepping into the limelight unbound and unabashed to challenge present archetypes.
Putting Malaysian Gold Jewellery on the Map
As a member of Federation of Goldsmiths and Jewelers Association of Malaysia, Foo Bao continues to participate in both local and foreign trade fairs, showcasing designs that are truly unique to our culture and cultivating an identity that will make Malaysia known for its exotic and never before seen designs. Foo Bao has also won numerous accolades, most recently named as the featured exhibitor for Penang’s most prestigious international gold fair, Penang Signature Gold and Jewellery Fair 2020. As a result, Foo Bao’s uniquely Malaysian designs will have the opportunity to reach international heights, catching the eye of key foreign markets like Singapore, Dubai, and Switzerland.
CUSTOMERS
With the aspirations to reach international recognition, we serve distinguished clients who share our passion for bold statement pieces that challenge the norm. From our B2B supply operations with reputable household names in the jewellery industry, foreign gold traders connected via international jewellery fairs, to celebrated individuals who enjoy the public eye, Foo Bao is the up-and-coming trendsetter coming out of nowhere to disrupt this stagnant industry.
Our major clients include:
- Poh Kong
- Habib
- DSV
- Emas Anuar
BUSINESS MODEL
Industry 4.0: Wholesaling Made Easy
Our team has worked to optimise the commercial experience when transacting with Foo Bao, allowing us to better understand and serve our clients efficiently and effectively. Foo Bao provides both offline and online wholesaling services to our clients, where viewing and selection of the range of products produced and offered is but a click away. Interested parties need only join our online platform to enjoy this seamless wholesale experience. For a view of our products, visit http://fashionjewellery.com.my/ or https://m.facebook.com/sb.foobao.7 .
Private Inbound/Outbound Logistics
Since Foo Bao’s inception in 2017, our operations have grown surely and steadily year by year. Now, we enjoy the patronage of many retailers in West Malaysia which spans across all 11 states. With our highly secured shipping services, our clients can rely on us to ensure that all orders from across the country arrive at their destination without a hitch. Further, all outbound shipments are insured against loss to boost confidence in our service.
Bold is Beautiful
As mentioned above, Foo Bao offers a diversified range of products. But most importantly, our passion and commitment to the art of goldsmithing is exemplified by the ingenuity employed by our artisan to create truly unique statement pieces that come to life to radically change the status quo.
Expansion 2022-2024: The Future of Foo Bao
Peering into the future, Foo Bao has set its sights on becoming the Tiffany of Malaysia, a trendsetter in gold jewellery with our design expertise, highly skilled and intricate craftsmanship. To date, we have received invitations to collaborate with numerous purveyors of lifestyle and luxury jewellery, while at the same time working to develop a tailored experience for individuals looking for adornments that were made solely for them.
Operations Expansion
- Expanding Across the Causeway and Beyond
Since establishing ourselves in Penang since 2017, our products and designs have been highly sought after in all peninsular states. To capitalise on the increasing global demand for gold, Foo Bao is aiming to establish ourselves firstly in East Malaysia, subsequently to Singapore and Dubai where demand has surged due to an increase in purchasing power.
- Synergise Marketing Strategies with Key Industry Collaborations
It is our goal to launch an aggressive marketing campaign to increase our brand awareness and definitively make our mark as the leading designer of unique statement pieces. Presently, our approach to capturing the market share is limited by the absence of a strong brand image. By seeking strategic collaborative partners, access to foreign markets is streamlined while paving the way for further transfer of competencies for further collaborations, resulting in a mutually beneficial endeavour for all.
- Operating at 100%
Certain prerequisites for this endeavour include increasing our range of products offered and increasing our current fabrication capacity. To date, Foo Bao is in the late stages of negotiations to acquire 100% of the manufacturing capacity of our current manufacturer. Due to the professional relationship fostered by maintaining strict policies on credit terms and repayment, Foo Bao has generated sufficient goodwill with our manufacturer and suppliers whereupon an option to purchase the entirety of the fabrication operation has been provided to us in the anticipation of the current proprietor’s retirement.
Designs and Collaborations
- House Brand Luxury Watches
Our collaboration with Soon Keng Ornaments has already caught the eye of the public since the launch of 34 premium designs. From sleek, elegant twisted gold strewn watch bands to complex avant-garde watch faces, our collaboration has resulted and will continue to result in the gleaming faces of high society. In the coming years, our research and development team will be dedicating our efforts to curating 100 high impact designs in the next 4 years, leveraging upon increased global and regional demand for gold jewellery.
- Lifetime Proposal and Wedding Rings
Regarded commonly as the most important day of one’s life, the union of kindred souls and their respective families call for only the highest standards of commemoration. And Foo Bao knows nothing less than perfection for the perfect occasion. With Foo Bao, grooms have the opportunity to make the commitment of a lifetime to their beloved with our lifetime proposal and wedding rings. With our expertise, grooms and brides will be adorned with a token that truly represents the love shared between them. Additionally, our specialty wedding sets are poised to accentuate the union, leaving nothing but the best for a magical matrimony.
- “Only You” Series
Just like the Platters song states: “Only you can make the stars seem bright”. This series is specially curated for individuality, where we put ourselves to the task of creating something completely unique. Our process includes materialising the intangible concepts within each person and adding our signature flares to create something that is one of a kind. Each creation will receive its unique certification, along with a registered trademark protecting that design.
- Limited Edition Products
As the seasons change, so do trends in design as seen by the resurgence of 80s and 90s nostalgia. Our artisan and design team are constantly looking out for the next big catch that can capture the hearts of the masses. This endeavour to stay ever relevant makes Foo Bao fiercely competitive, especially during gold fairs where such limited-edition products effortlessly catch the attention of both the local and international crowd.
MARKET
Golden Age for Bullish Bullions
In the past few years, the market value of the gold industry has risen, from USD 163.90 billion in 2017 to USD 249.02 billion in 2021 at a staggering compound annual growth rate (CAGR) of 11.02%. Further, the industry is expected to expand at a CAGR of 8.5% from 2022 to 2030, reaching a value of USD 518.90 billion. Increasing disposable income and innovative jewellery designs offered by manufacturers are expected to drive the product demand. Changing lifestyles and perceptions of jewellery as a status symbol are expected to boost the growth of this market. COVID-19 has had a positive effect on jewellery sales, with 30% of consumers in a recent poll reporting they purchased more jewellery during the pandemic , according to a study from the supplier group, the Plumb Club. The survey entitled “The Plumb Club Industry & Market Insights 2021” also noticed that 49% of consumers bought as much jewellery as they always did, while 21% purchased less.
Asia Pacific captured the largest revenue share of more than 60.0% in 2021. This whopping market share is mainly attributed to the high demand for jewellery from densely populated countries in the region including India and China, where gold is consumed on a large scale. China was the leading country in the market owing to the increasing spending power of the population and swiftly developing economy.
Domestically, the export value of gold is projected to surpass RM 6 billion in 2022, having reached the RM 5.1 billion mark for January-November 2021. This increase is led by plans from the US Federal Reserve to increase interest rates, resulting in softened gold prices and higher gold jewellery consumption. Relying on comparisons from 2021, while average price of gold stood at US 1,800 (RM 7542) per ounce demand for gold remained strong, with the World Gold Council reporting an increase of 33% from 2020. In the ASEAN region, exports are expected to increase to Vietnam, Thailand, and Indonesia. It is reported that Bank Indonesia projects national economic growth in 2022 in the 4.7%-5.5% range, up from 3.2%-4.0% in 2021, driven by ongoing global economic improvements that are driving solid export performance, coupled with growing domestic demand in terms of consumption and investment. Similarly, Thailand expects economic growth of 3.5%, driven by the revival of their tourism industry, easing Covid-19 restrictions, and rising vaccination rates. All signs point to robust demand for Malaysia’s gold jewellery exports.
Rings captured the largest global revenue share of over 25.0% in 2021. This segment is likely to retain its pole position throughout the forecast period. The rising sales of rings worldwide are mainly driven by the increasing demand for wedding rings, coupled with the growing preference for corporate dressing. A key trend that has been gripping the market for jewellery in recent years is the rising sale of rings within the male consumer segment. This can be attributed to improvements in men’s jewellery designs and rising fashion awareness among men around the world.
TRACTION
Clientele
Over the course of 5 years, Foo Bao has grown to serve all 11 states in Peninsular Malaysia while experiencing unprecedented growth within the same time period. From a mere 45 clients in 2017 to 181 clients in 2021, Foo Bao has taken the time to establish our fundamentals and capitalising on opportunities that have arisen. For instance, our participation in the Penang Signature Gold Fair in 2019 is heralded as one of the main catalysts for our growth, drawing in 62 new clients from all 11 states. Outside of our home base in Penang, Foo Bao gained the most recognition in Johor, Kelantan, and Malacca over the years, exhibiting a pattern of preference for our specialty in statement pieces.
As mentioned before, as a wholesaler with clients who are household names in their respective locales such as Poh Kong, DSV, Habib etc, part of our success is owed to the fact that these industry leaders hold influence in the retail market. As leaders in the industry, these large retailers set the trend for their smaller counterparts in the industry when it comes to ascertaining the market behaviour of the day. As such, our clients provide a perception of trend forecasting that will lead smaller retail gold outlets to follow suit in purchasing our designs for the fear of missing out.
Volume Traded
This surge in clientele has necessarily resulted in the growth of our sales volume, from 24,170 grams traded in 2017 to 660,777grams in 2021. To further contextualise our growth, the mean price of gold in 2017 was RM157 per gram, amounting to RM 3.79 million in sales revenue. The average price of gold in 2021 increased to RM 243 per gram, drastically increasing our net revenue to a whopping RM 160.56million.
COMPETITORS
Presently, a large portion of industry players are still slow to evolve with the digital economy. A simple search will reveal that our capital expenditure in recent years has provided us the means to service everyone via e-commerce through our website, enhancing our ability to fulfil orders efficiently. Further, even though it seems that there exists stiff competition in the gold jewellery market, most companies are focused on conventional designs.
FUNDING
Fundraising Sum: RM 4,000,000
Allocations:
- Marketing Team Expansion [90%]
- Design Team and Key Collaborative Initiatives [10%]
Projections
Following the easing of Covid-19 restrictions in line with global economic policies, Foo Bao has experienced a 41.03% growth YOY in sales volume from 2022. Moving along 2023, we project further growth of 40% in sales volume, as we implement our expansion strategies with capital expenditure on the aforementioned divisions, while incrementally increasing growth over the next 2 years with a commitment to ensuring sustainability.
TEAM
Momo Foo, CEO
Foo Bao is managed by 4 individuals holding executive functions, which includes Momo Foo. Coming from an extensive career in operations management in the fabrication industry, Momo places above all else the highest regard for efficiency. Having worked for multiple MNCs, she has first-hand experience in implementing technological solutions that have been crucial in reducing wastage while increasing productivity. Since taking the helm in 2017, Foo Bao has continued to thrive even in the uncertainty of the pandemic and is projected to take to new heights in the coming years. She is aided by 3 other directors that manage the sales operations and sourcing new opportunities for the growth of Foo Bao.
PRESS
https://malaysiagazette.com/2022/08/19/dsv-gayakan-barang-kemas-only-u-bernilai-rm1-juta/
https://mediavariasi.com/2022/08/vida-jadi-pilihan-only-you-peraga-emas/
https://www.malay.news/dsv-gayakan-barang-kemas-only-u-bernilai-rm1-juta/
https://www.facebook.com/watch/?v=460554299417628&extid=CL-UNK-UNK-UNK-AN_GK0T-GK1C&ref=sharing
https://berita.rtm.gov.my/index.php/semasa/45576-dsv-gayakan-barang-kemas-bernilai-rm1-juta-bagi-populariti-penjenamaan-barang-kemas
https://www.facebook.com/watch/?v=791863788908263&extid=CL-UNK-UNK-UNK-AN_GK0T-GK1C&ref=sharing
DISCLAIMERS
- No shares will be allotted or issued based on this document after six months from the closing of the offer period.
- This issue, offer or invitation for the offering is a proposal not requiring authorisation of the Securities Commission under section 212(8) of the CMSA 2007.
- This document has not been reviewed by the Securities Commission Malaysia. The Securities Commission does not recommend nor assumes responsibility for any information including any statement, opinion or report disclosed in relation to this fund raising exercise and makes no representation as to its accuracy or completeness. The Securities Commission expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the information disclosed.