Lyu Gang, chairman and chief economist of Shanghai Silk Group. [Photo by Gao Erqiang/China Daily and provided to China Daily]

Lyu also points out that the brand's approach of making silk "affordable and alluring" has allowed it to flourish despite a flagging industry. A silk scarf from Silk Road on the Sea costs around 400 yuan. A similar product at Hermes can cost about five times more.

While China may still be the world's largest silk producer, exporter and consumer, the domestic industry has been in decline for the past two decades.

Silk production has been hit by the dwindling population of mulberry farmers, who have replaced their crop with more lucrative plants like passion fruit, and this has in turn caused the price of silkworm cocoons to balloon. This spring, silkworm cocoons cost 40 percent more than usual.

Other factors behind the industry decline include the rising costs of labor and the measures required to reduce the amount of pollution caused by the dyeing of silk products.