Perhaps the reason why we talk about Rolex so much is because of how unusual a brand it is. Rolex often makes the news for both good and bad reasons. The Crown made the headlines most recently because of its acquisition of Bucherer which will allow the brand to become bigger and more powerful than ever before. Rolex has indeed become a massive player (if not the largest) in the world of horology, so much so that it seems the brand can do anything it wants. That’s because over the years it has become master at becoming independent by acquiring several businesses that had historically made parts for its watches. And this process was gradual and each step the brand took had a profound impact on the way it now operates. In this article, we’re going to first discuss what does it mean for a brand to be “independent” and then look at several events that changed Rolex. Source: www.rolexpassionreport.com
What Is an Independent Watch Brand?
There are actually a few ways to look at this. In today’s world, we often hear of independent brands (and microbrands) in the sense that they don’t belong to a group or conglomerate such as Richemont or Swatch. Therefore, any brand outside of such a group can be seen as independent in the sense that they can make their own decisions and take any direction they wish to: creation of a new collection, research and development of new technology, positioning themselves in a given market in any way they please, etc. In other words, independent brands are privately owned and operated. Rolex is independently owned although it doesn’t function as one single entity—something that will hopefully make sense below.
The other way to look at independent brands is as follows: any brand that has complete control over its design, manufacturing, and research. In other words, what we define as being “vertically” integrated. Seiko, Omega, Tudor, Rolex amongst others are vertically integrated in the sense that they control their means of production. For example, Rolex melts its own metals, manufactures its own movements, and does its own research and development. Seiko operates the same and even grows its own quartz crystals in-house (yes, quartz crystals can be grown in a lab). That is perhaps the most extreme definition of being independent when we talk about watch brands.
Rolex is therefore an independent brand, but it actually became one after acquiring a few key businesses.
The Gay Frères Acquisition of 1998
In the early 1990s, Rolex started a plan which journalists refer to as the 'industrial rationalization' by which the brand would centralize its means of production and management by acquiring its suppliers. During that time period, Rolex acquired more than one business, including Beyeler & Cie that made their dials, Boninchi that made their crowns, and perhaps more importantly, Gay Frères, the famous bracelet manufacturer. Gay Frères is the most interesting acquisition in my eyes because of the Oyster bracelet which many see as being a Rolex invention. But it isn’t. Gay Frères created the design and initially sold the now famous three-link bracelet to several watch brands. However, Rolex was a key player in pushing Gray Frères to continuously improve the design. Eventually, by acquiring Gay Frères, Rolex was able to fully take control of the design and development of the bracelet which has become a staple of the brand’s sport catalog.
The Aegler Acquisition of 2004
As mentioned in my recent article on the Alpina Alpiner Heritage 140 Years, Rolex used Alpina calibers in their rectangular and square dress watches. Like many Swiss brands did for many years, Rolex used movements made by several manufacturers, for example ETA, Valjoux, and more importantly, Aegler (it should be noted that it was the integration of ETA into the Swatch group and the fact that ETA wouldn’t be providing movements to brands outside of the Swatch group that pushed Rolex to acquire Aegler in 2004). However, Aegler had been manufacturing movements for Rolex exclusively as early as the 1920s, and since the 1930s, operated as a subsidiary of Rolex. But it wasn’t until 2004 that Aegler was sold to Rolex which permitted them to market their “in-house” calibers.
Starting in the 1990s, therefore, Rolex began acquiring all of its suppliers in order to take control of all aspects of its production. As we saw above, Rolex had been the sole client of Aegler for many decades—and perhaps it was the same with Gay Frères—before it acquired the company. One thing I did mention in the article on the Alpiner is that Hans Wilsdorf, with a brand that had been around for just over a decade, managed to convince Alpina to engrave the name “Rolex” on the plates and bridges of the movements that Rolex bought from them. This was a bold move and I can imagine Wilsdorf going about working in the same fashion with all its suppliers before Rolex officially bought them all, many years after Wilsdorf’s passing. In my opinion, then, Rolex didn’t truly become independent until 2004 when it acquired Aegler, roughly a century after it was created.
Featured image: www.bobswatches.com