Small Independent Watch Brands - The lament of those who are drowning

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March 2013

The refrain is well known. It has been sung in these columns on several occasions, but now it has really become stuck in the mind. The refrain? The lament, more like, is that of the small independent companies that are drowning.

On one hand, you find a modest but quite honourable brand that, after ten years of efforts, finds doors closing to it one by one. On the other hand, a single independent company, whose beautiful and artfully enamelled products are no longer welcome at stores which are already inundated with merchandise.

Here and there, small yet very innovative companies are closing their doors; investors are giving up and vanishing into thin air. Recently, an open letter was received at the editor’s desk, from an “independent family business” standing up for its “right to exist without being constantly threatened by an attitude of short-term profit and unrestrained capitalism (…) and by devastating pressure on distribution (…), which will result in less choice.” This same company pleads, loud and clear, for the “re-establishment of healthy competitive practices for the betterment of the industry and in the interest of the final consumer,” before concluding that “without this awareness, it will be more and more difficult to bring to our wonderful industry the freshness of sensible alternatives.”

Behind the triumphant numbers of the year—for the first time, the Swiss watch industry exceeded the threshold of CHF 21 billion at export—the biodiversity of the watch landscape is inevitably declining. One by one, the niches that provide the variety in the watch industry are being occupied by the big groups. But how can we blame them? Why should they restrain themselves when everything, beginning with their shareholder structure, pushes them to make a profit at any cost, while a silent war rages in the display windows.

Small Independent Watch Brands - The lament of those who are drowning

So, how then can a small watch company specialising, for example, in the métiers d’art survive—or even simply succeed in placing a few products that it transports in a rowboat, while nearby the big groups arrive in aircraft carriers loaded with pallets of high-end watches?

Another concern relating to watchmaking biodiversity is that the dazzling numbers barely conceal a reality that, over time, is indeed worrisome: the decrease in volume (down 15.3 per cent in December 2012, down 2.7 per cent for the year) accompanied by an increase in value (up 11.3 per cent for the year). This means quite simply that fewer watches are being sold, but at higher prices.

This evolution does not concern only the watch industry; it is widespread in other sectors, too. It is, in fact, a reflection of a much more general phenomenon in society. In other more political times, we called this “imperialism”, the “natural” tendency of the big to grow even bigger, of the propensity of kingdoms to become “empires”.

Having said that, however, there are some counter-attacks happening here and there. Initiatives are being launched, groups are being formed. In other words, life goes on, always confounding predictions. But let’s be attentive to this general increase in hostilities and to this race ahead, because they may be the warning signs of a major new bubble.

Source: Europa Star February - March 2013 Magazine Issue