Verbatim Monday, September 10th 2012
A year after the acquisition of Sowind (Girard-Perregaux and JeanRichard), François-Henri Pinault, head of PPR, discusses the group's strategy for its watch brands in an interview to French daily "Le Figaro".
Cast your mind back a year. After taking a minority share in Girard-Perregaux, PPR - whose luxury division includes Gucci, Bottega Veneta, Yves Saint Laurent, Alexander McQueen, Balenciaga, Boucheron and Sergio Rossi - took full control of the watch company and appointed Michele Sofisti, CEO of Gucci Group Watches and Jewellery, at its head. In a recent interview to Le Figaro, Chairman and Chief Executive François-Henri Pinault explained the group's strategy for the luxury segment.
The group, which has been sitting pretty in the luxury segment for ten years now, has no intention of rushing headlong into new acquisitions. "We prefer to acquire small or medium-sized brands which have genuine expertise in their field," Pinault explained. "PPR is concerned with building a portfolio and doesn't buy a company simply because it's for sale. Once all our brands have reached a satisfactory level of maturity, then we can envisage adding to our portfolio."
Reposition Girard-Perregaux at the forefront of fine watchmaking
Since 2001, 90% of growth at PPR's luxury division has been organic. Two opportunities arose in 2011 in the form of Italian tailor Brioni and Sowind Group, owner of Girard-Perregaux and JeanRichard. "Girard-Perregaux has genuine credentials and is well-known to collectors," continued François-Henri Pinault. "It has strong potential. Our objective, with Michele Sofisti, is to reposition Girard-Perregaux at the forefront of Swiss fine watchmaking. Hence we have brought in an extraordinary master watchmaker, Dominique Loiseau. He is working on what could well be a revolutionary approach to mechanical timekeeping. We'll unveil the first watches in 2013 (…). Over the past year, we've rationalised the assortment and at the same time tightened industrial resources as there were opportunities to improve productivity and efficiency at manufacturing level. We're repositioning the JeanRichard collections within a more affordable price range of EUR 1,500 to 2,000 (USD 1,918 to 2,555 / CHF 1,813 to 2,418). Sowind's total production for 2012 will increase to 20,000 watches. Ultimately, at its own pace, it could manufacture 40,000 watches a year".
Further synergies are on the agenda. Girard-Perregaux already supplies complicated movements for certain Boucheron jewellery watches and equips Bottega Veneta's first watch. It will benefit from Gucci Timepieces' distribution network. Boucheron, Gucci and Girard-Perregaux will share a single space at next year's Baselworld. PPR won't, however, be setting up a watch and jewellery division. "This has never been our approach," comments François-Henri Pinault. "We build bridges but we have no plans to create a dedicated entity. Each brand must remain autonomous and stay coherent with its original environment." ■