Some articles say year on year sales are down. Others say growth has dipped. So which is it? If year on year sales are down, it means they sold less this year than last year. But if growth has dipped, that means sales aren’t increasing as much as they used to (but they’re still increasing).
They’re two different problems, and one is worse than the other. But what’s really going on?
Nick Hayek says the Swiss government deregulation of the Franc is to blame. In February Swatch, the conglomerate Hayek oversees, reported a 21% drop in net profit (presumably for 2015). He claims sales still look good in some other countries while those sales as reported in Swiss Francs don’t look as rosy.
Others blame dipping Swiss watch sales on poor performance of Asian (read, China) economies, which have shown lackluster performance for the last few years. The Federation of the Swiss Watch Industry recently reported April watch exports slumped 11.1 per cent year on year (there’s that term again). They claim those figures were largely influenced by a 17 percent fall in exports to Hong Kong, the largest market place for Swiss watches.
It turns out Asia is as important a place to sell as it is to buy.
Meanwhile, sales over at Richemont Group have fallen so sharply that they’re buying back stock from Asian dealers and destroying it (in some cases). Richemont officials were quoted in the Financial Times a few days ago, as saying, “Watches bought back from dealers in Hong Kong were either reallocated to other regions or – in the case of older models which were no longer selling – dismantled and recycled.” Yikes!
Meanwhile, the market for vintage watches has taken off. Led by record results every spring and fall watch season in the auction world, people – especially young people of means, it seems – are haunting internet sites like AnalogShift, Chrono24, and Bob’s Watches, even eBay, where watch buying can be risky behavior indeed for the uninformed or unwary.
They’re looking for birth year watches, and cool old divers and chronographs from the 60s and 70s. but they’re also looking for vintage daily wearers from LeCoultre, Omega, Tissot, Hamilton, etc. these were the watches fathers and grandfathers wore.
These guys know that there’re a lot of cool old timepieces lurking out there. Not all of them are Red Subs, Paul Newmans, or Steve McQueens. Many more are Wakmanns, LeCoultres, Angeluses, Bulovas, Omegas, and the like.