SDC Weekly 90; Louis Vuitton x Kari Voutilainen; Nick Hayek, Unleashed; The Hairspring Debate; US Treasury Secretary Scott Bessent’s Economic Vision & What It Means for Watches
Another Rolex Patent, Bucherer’s Transformation Gathers Pace, Households’ Emergency Funds Dropping, and Perfect Sleep.
🚨 90 editions just makes me think: I need a new hobby 😂
Estimated reading time: ~31 mins
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Households’ Emergency Funds
There is not a lot more to say, as the chart says it all - but let me ask you this: if households’ ability to come up with $2,000 for an emergency expense within the next month is at the lowest level since the survey started in Q4 of 2015, which watch categories do you think will suffer the most? Let me just say, I think it’s not the high-end stuff 😂
It’s not all doom-and-gloom, though. Read about the Treasury Secretary’s plans below to find out how we might be in for a more positive outlook for the USA in the next few years.
Bucherer’s Transformation Gathers Pace
Bucherer recently reopened in London’s Westfield shopping centre, and to me, this gives us a little glimpse into Rolex’s strategic direction following their acquisition of Bucherer. The newly expanded store is 4,000 square feet but despite gaining nearly 50% more retail space, Bucherer has actually halved its brand lineup. Most notably absent are Omega and Cartier – two competitors from rival groups.
In their place is - you guessed it - expanded real estate for Rolex, a dedicated Rolex Certified Pre-Owned lounge, and carefully selected brands that don’t directly compete with Rolex (if that’s even possible).
This is hardly subtle, is it?
This was Bucherer’s first major London renovation since Rolex acquired them, and I think it offers a preview of how the Bucherer network will likely evolve globally. The strategy appears to be: gradually phase out competitor brands and expand Rolex’s footprint, both for new and more importantly, pre-owned watches. Rolex even rolled out this model in a new Watches of Switzerland store this month.
As for the brands now excluded from Bucherer’s prime retail spaces, this would appear to create a bit of a dilemma. If the traditional multi-brand retail options are shrinking, brands will face increasing pressure to invest in their own mono-brand boutiques – but this is an expensive proposition during an already challenging period. The alternatives are to reduce production to match their retail footprints, or become increasingly dependent on the remaining independent retailers who will hold even stronger negotiating positions (and therefore squeeze margins even further).
In summary, Swiss watch exports are continuing their downward trajectory and plenty of brands are struggling with excess inventory - this means that access to prime retail channels is becoming more critical than ever. Rolex’s ‘strategic consolidation’ of Bucherer will essentially force competitors to choose between costly direct retail investments or accepting reduced visibility in key markets.
Looking ahead, it feels like this London renovation gives us cues about Rolex’s long-term strategy. I’d expect similar transformations across Bucherer’s global network, and predict they will gradually evolve toward what may eventually become Rolex’s worldwide mono-brand network for both new and pre-owned watches, as well as service centres, all under one roof. We shall see!
That’s enough of the small stuff…
🐱👤 Nick Hayek, Unleashed
“I’m not interested in whether my employees are Catholic, whether they are religious, gay, whether they are married, whether they have children, whether they go to the brothel, whether they smoke pot.”
Nick Hayek, CEO, Swatch Group