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The half-full glass
Point of View

The half-full glass

Thursday, 02 February 2017
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Franco Cologni
President of the FHH Cultural Council

“Talent demands effort, dedication and hours spent perfecting a gesture which, day by day, becomes a gift.”

An entrepreneur at heart, though a man of letters, Franco Cologni was quick to embark on a business career that would lead him to key roles within the Richemont Group.

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3 min read

Latest export figures have proved better than anticipated, which bodes well for what’s to come. So let us drink from a half-full glass rather than mope over one left half-dry.

Shortly before Christmas, we took an educated guess at what Swiss watch exports would be for 2016 as a whole. Now that the actual figures are known, published by the Federation of the Swiss Watch Industry, it appears we were out by just a few percentage points. Exports are confirmed as having fallen by 10% in volume at 25.4 million units, and by 10% in value at CHF 18.3 billion. Confirmed in a positive way, as we based our estimate on extrapolated figures for December, which were in fact better than expected, having posted the smallest fall of the year (-4.6% in value).

Everything would indicate that 2017 will be a year of consolidation for the watch segment, enabling brands to tend their wounds and set off afresh.
Franco Cologni

This bodes well for the future. Not only have the major luxury companies shown encouraging results these past months, Salon International de la Haute Horlogerie, which gives the lie of the land for the profession, put on a good edition, with strong attendance, satisfactory orders, “realistic” but also top-flight products, a record number of exhibitors… Everything would indicate that 2017 will be a year of consolidation for the watch segment, enabling brands to tend their wounds and set off afresh. Provided, that is, they have the political and economic context on their side: with high-risk elections in several European countries, and a Dantean start to Mr Trump’s term of office in the United States to say the least, there may be surprises in store.

The coming year will see a shift in paradigm nonetheless. Economic theory teaches us that markets are generally driven upwards when demand is greater than supply. This has hardly been the case in recent months, given the mountain of inventory which had to be absorbed. However, watchmakers have understood that by analysing demand, particularly from younger generations, more closely, they will find sufficient outlet for growth. The watches on show at SIHH already go some way towards this, with prices that reflect the true value of the product and a particular focus on entry-level. It’s worth remembering that the Fine Watch segment (export price >CHF 6,000) was hardest-hit in 2016, when it lost almost 16%. We prefer to avoid another slap in the face this year! Personally, I would rather drink from a glass that’s half-full than complain about one left half-dry. Efforts made will fill them both. Best wishes for 2017.

Nota Bene

For what it’s worth, it has come to my ears that not only did I supposedly fire a torpedo, but I also missed my target, having got the wrong boat. It seems to me that a boat that hosts revelries as SIHH opens is still a boat. And that Jean-Claude Biver, who may have had the nerve to invite the same people as the organisers of SIHH for more or less the same time, is no less an excellent manager. We don’t need “hacks” to remind us. Perhaps next year we shall raise our glass together.

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