Europa Star: Is it the result of current economic crises and political uncertainties? Certainly, the winds seem to have changed direction. After the wild race up-market by many brands, it now seems that we are witnessing a return to reason, which is good for brands like yours in the mid-range sector of the marketplace

Olivier Bernheim: 2003 will be a tough year. It is starting off in an atmosphere of total uncertainty. Investors lack confidence in enterprises. Enterprises lack confidence in their own strategies. Partners lack confidence in the solidity of their relationships. Consumers have lost their confidence in the brands... Doing everything to develop confidence, or consolidate it where it is shaky, is essential for distributors, for retailers and for the consumer. What seems to be an enormous task for some is not so difficult for us however. Contrary to certain others, we have never lost this confidence, and for a very simple reason. Raymond Weil has always been consistent in the design/quality/price ratio. Today, this ratio is a key element in consumer decisions. The time of extravagance is past. We are no longer in an era where pure appearance or ostentation counts.

ES: Contrary to the general trend over the last few years, you have not made any efforts to master your direct distribution…

O.B.: Historically, the Raymond Weil brand was born and grew up in the network of distributors. We have a great respect for them. Most of them have supported us since the beginning and have been instrumental in our success. As for the retailers, as far as I know, there are always ups and downs in their stores. A good salesperson still sells what he or she wants to sell. If we have the support of our distributors and retailers, we need to show them confidence and support in return.

ES: And how is this support given?

O.B.: In many ways, but also and above all by our actions aimed at motivating the consumer. So, in 2002, contrary to the general trend, we invested massively in advertising aimed at the final customer in international media such as Time, Newsweek, etc. We were even more alone than normal in this endeavour. But especially in a period of crisis, I believe that human relationships count enormously... herein lies the story of Raymond Weil's growth development. Human relationships are not quantifiable. They are what escapes the strategies that are created and operate away from the field.

ES: In a few years, Raymond Weil has passed from the status of a manufacturer and seller of watches to a full-fledged brand. How has this basic change come about?

O.B.: To move from being identified as a broad-based enterprise to recognition as a veritable brand has taken, we could say, 15 years. During the last four years, this new status, acquired because of our continuous efforts, has allowed us to triple the average price of our watches. The average price has gone from CHF 800 in 1998 to CHF 2,000 today, within a range of CHF 250 - 1,500 in 1998 to CHF 800 – 4,000 today. Having said that, we have not departed from our stated course but have built upon our fundamentals. This new positioning has been obtained while respecting the transparency and verity of our offer, by considerably improving the design, quality and product environment, by clarifying our global offer, by creating a pyramidal structure for our collections and reducing the number of models. The consumer of today is over-informed. The tacit bond of confidence can be destroyed if a brand is content to simply make very minor improvements, or even to change nothing, and yet raise prices. Every price tag must be fully justified by the contents that give it legitimacy. We cannot, or no longer can, fortunately, make just any old thing.

ES: Concretely, what is the Raymond Weil offer today?

O.B.:Our offer is very clearly structured in collections that are individual and recognizable. There are six: Othello, Parsifal, Don Giovanni, Tango, W1 and Tradition. They are not random groupings. We are constantly trying to profoundly understand what the customer wants and what we can do to meet those wants. In today's world, it is not enough to wait for the client to come to us. We must go out looking for him, find him and take him by the hand. In general, but even more so today, the consumer needs to feel secure. In a world that is full of worries and fears everywhere you turn, the bond of confidence, based on truthfulness in the offer, is of capital importance.

ES: This new offer has certainly led you to target new customers and new retailers...

O.B.: Change is the order of the day. The fashion brands that have sprouted up all over have played an important role because they have forced watchmakers to move upmarket as well as to increase creativity. At Raymond Weil, a 'young' brand in comparison to its Swiss competitors, creativity has always been a central theme. I think that 2003 will be a good year for the evolution of our brand because we have shown our creativity, our originality, and our ability to renew. This renewal of our offer, which notably includes an increase in men's mechanical timekeepers from an earlier 5% share to 20% today, permits us to maintain our new pricing levels. Another factor is fundamental: the clarity of our vision. We not only have a very precise vision of the potential of our present offer, but we know very clearly where we want to go in the future. In concrete terms, the limited number of different and correctly targeted collections allows us to accurately determine the number of watches that we must produce in each category. This lucid view contributes greatly to the health of the relationship with our retailers. Our commercial objective, at the heart of this relationship, is to assure them of having zero returns of stock. We are absolutely the opposite of some brands that produce and then try to find a place to sell their wares. What we make is already placed. It is on this base that we can build the confidence that I spoke of earlier, and that is essential to the good health of a brand like ours.