Surving the sequester
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Thread: Surving the sequester

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  1. #1
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    Surving the sequester

    If you were to guess, which high-end watchmaking firms, if any,, do you think will expire as a result of travails wrought and/or compounded by the CoV2 pandemic's having stifled trade?


    Note:
    Though the focus is on high-end firms, feel free to note near-high-end firms, which for simplicity's sake are, for this thread, firms whereof the "price of entry" is $4000 MSRP and the maker has at least one current non-noble metal piece priced above $10,000. An example of near-high-end firm that one might consider mentioning is Habring. Rolex and Omega are others.

  2. #2
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    Re: Surving the sequester

    Seriously? Nobody here follows the industry enough to offer well-informed, or reasonably so, thoughts on what firms are in jeopardy of ceasing to remain a going concern?

    A fair number of major retail firms teeter on the edge.
    -- "List Of Retail Companies On Bankruptcy Watch Is Growing Fast Amid Coronavirus Crisis"

    Surely the watch industry is no different.


    About a couple months ago, it was reported that the Swiss watch industry had lost 30%-40% of its revenue. That's revenue that cannot and will not be recouped. Sure, some well-heeled diehard watch enthusiasts and collectors may be thinking the pandemic merely wrought a deferral of their purchases, but among most consumers, buying a watch is unlikely to be on their priorities list when the crisis ends. Be that as it may, it's likely some watch firms will fold as a result of the pandemic having been the proverbial "straw" they couldn't carry, forcing them to sell or merge, even if their brand(s) persist.

    Of course, many watch manufacturing firms are closely held, so it's hard to glean their financial position, and harder still to know it.

    From March 2020:


  3. #3
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    Re: Surving the sequester

    Impatient much?
    Whilst we’re all on lockdown, it doesn’t mean we’re glued to WUS or other forums, 24/7.
    Then there’s the level of interest in the financial matters of brands – luxury item manufacturing ones at that – when the main focus is on what they output design and cost wise.
    It’s quite a different matter when it comes to a business you use for convenience (DIY) or regularly for essential things like sustenance/clothing/etc.

    That reported 30-40% downturn won’t be even spread across all brands, so the breakdown would be more useful in determining who’s suffered the most, and whether they’re buoyant enough to continue for another 6-12 months, when it would be expected that things return to some semblance of normality for the industry.

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  5. #4
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    Re: Surving the sequester

    I'm not familiar with all price increases over the last five years or so, but the price of watches do seem to have jumped considerably.

    I was saving for a VC Overseas, but I can no longer justify the cost. I used to buy something every couple of years (although admittedly not high end) but I haven't bought anything for a while now. I particularly like Omegas, but they are nearly double what I paid for my last one.

    The point is that watches have got very expensive for what they are and there will no doubt be an awful lot of people who will find that they no longer have the sort of disposable income that will allow them to buy watches. Obviously some will, but perhaps not at the frequency they did. This means that the market is bound to shrink and manufacturers will struggle. I can see some consolidation within the bigger groups. The names will still exist, but individual brands will be made in the same factory in order to reduce costs.

    Also the Chinese markets, which has been a big earner, might not be so favourable. Rightly or wrongly, there is a lot of anti-Chinese sentiment due to the Corona Virus and I know people who are already boycotting Chinese products. This could potentially have a big impact on their economy and again, disposable income seriously reduced and consequently a reduction of watch sales.

    Difficult times are ahead for lots of manufacturers and there will be some big name casualties in all fields.

    Ironically, for those still with disposable income, it could be a good time to buy watches. I don't necessarily see prices coming down per se, but discounts will be bigger or more readily available as retailers look to move stock.
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  6. #5
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    Re: Surving the sequester

    Prices are already shifting down quite a bit. So much so that I got a ridiculous deal on a brand new Zeitwerk from an AD. A few other dealers I've done business with or left inquiries with as well followed up way more aggressively than normal.

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