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Sales of Games products to top $450m

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Models in Beijing present franchised gold souvenirs for the Guangzhou Asian Games. [Yuan Zhou/For China Daily]

Sales of licensed products from the Guangzhou Asian Games are expected to top 3 billion yuan ($450 million), with most of the franchise producers and vendors making a profit.

That is according to Huang Canhui, Deputy Administration Manager of Marketing Department of the Guangzhou Asian Games Organising Committee.

An explosion in sales is expected in the coming months, which should account for about half the total sales, as the Asian Games and Asian Para Games are held between Nov 12 and Dec 19, Huang said.

Licensed products from the Games first entered the market in February 2008, and sales have been rising slowly. Franchise vendors did not make a profit until August last year.

However, as the Games approach, sales have been robust, with those last month double of those in August. Similarly strong growth is also forecast this month.

Sales have been partly driven by the fast appreciation of gold, with products made from the precious metal making up 65 percent of sales so far.

They have also been boosted by group purchases, which account for more than 60 percent of the total sales so far. Licensed products are used as the official gifts of the Games organising committee.

Sales started to rise significantly in September after a long period of moderate performance at the stores of Guangzhou Kingway Gifts Industrial Co, which is both a franchise producer and vendor, said General Manager Shen Hui.

The company operates 70 franchise shops across Guangdong Province, and is the largest franchise network. It places more value on the promotion of its brand than in the profit which will accrue from its franchise role.

Most franchise producers and vendors are likely to make a profit, helped partly by measures instigated by the organising committee to encourage sales. These include exemption from the franchise shop management fee, which ranges between 2,000 and 3,000 yuan per shop, Huang said.

Franchise producers and vendors - numbering 39 and 24, respectively - make and sell about 4,000 products in 14 categories.

Many are examples of Cantonese cultural heritage, such as Duan Inkstone, Cantonese embroidery and porcelain, and paintings of farmers in Longmen county.

The products range in price from 1 yuan to 660,000 yuan, with those costing between 200 and 300 yuan proving the most popular.

Inventories are expected be sold out by February, Huang said.