Posted by Stephen Welfare, Partner
On 1 September 2016 Withy King LLP merged with Royds LLP. The trading name for the merged firm is Royds Withy King. All content produced prior to this date will remain in the name of the firms pre-merger.
Watching Brief – Time for a new approach?
Stephen Welfare reports from Baselworld 2013, Basel, Switzerland.
This week I visited the 2013 Watch and Jewellery Show which has a new hall complex with a large continuous exhibition area in the main hall. This increased space is being exploited by the main watch brands; Rolex, Bulgari, Tag Heuer, Breitling, Omega, etc, and Royds client, the Dreyfuss Group (Rotary Watches).
With European jewellery retailers still feeling the pinch on the high street, jewellery brands and luxury goods brands are increasingly active in the watch market. With the exception of couture jewellery, such as UK designers, Rodney Rayner and Stephen Webster, who both have established worldwide clientele, the market for jewellery across Europe remains difficult and caught by the economic recessions in the west. I have previously reported on the growth of the eastern market and how forward thinking UK companies are targeting that part of the world and the new cash rich buyers of Hong Kong, Mainland China, India and elsewhere in the East [Entering into the Dragon’s Den. Stephen Welfare, partner reports back from the Hong Kong International Jewellery Trade Show]. At Baselworld the growth appears to be in time pieces if the size of the watch brand stands is anything to go by.
Brands long established in luxury goods were at Basel promoting watches e.g. Burberry, Chanel, Dior, Davidoff, Hermes and Hugo Boss (and no doubt others). This is not to say that fashion houses have not been doing watches before, many have, for many years. What I observed compared with previous years was the prominence, at least on display, of watches within fashion and jewellery brands. Can it really be that sales in watches are increasing against a fall in sales in most other luxury items? I do not know, and Baselworld is not a good barometer for such things since this watch show in Switzerland is THE show for selling watches; probably in the world. It could well be that the apparent strength at watches at a watch and jewellery show is nothing more than the flexing of the spending power muscle of the international watch brands in their own backyard; Switzerland.
Whatever the reason, the new hall complex at Baselworld has created something special amongst the premier brands. It is impossible not to be impressed with the majesty of the Rolex stand, the giant exotic fish tank dominating the Breitling stand, and the lights and glitz of the Swarovski stand. At a widely estimated cost of €7M such marketing does not come cheap. Baselworld is not for the economically faint hearted. Even a modest sized stand here is likely to cost in the region of €70,000 to hire for 7 days of the show. Just to visit costs 60 Swiss Francs per day, compared to most other shows around the world where buyers, distributors and service providers (like me) are invited to do so for free! Is this Swiss arrogance or a guard against non commercial visitors? Baselworld does not operate any vetting or other compulsory application process. Given the vast amount of artistic talent and new designs on display, the entrance fee is certainly no deterrent to would be copiers and plagiarists.
A dilemma faced by businesses both in times of economic growth and recession is whether or not to diversify and if so, to what degree? Should one extend the range of goods or services to reach a wider market or stick with the proven core goods/services? In some cases it will be essential to diversify, to add say watches to the complimentary goods the business has become recognised for, whilst remaining true to the quality and spending power of your customers. For others, it is in the protection of the core market with improvement in quality, pricing and efficiency that are the essentials for survival and profitability. Baselworld gave me no answers to these questions.
Times do change of course and yet beauty remains the same. A true classic, be it a Rolex gent’s wrist watch or an original finely crafted diamond ring, retain appeal. Classical jewellery is said to be timeless, but if the business cannot or will not keep up with the times, it will not survive and what good is a classic design then?
Jewellery & luxury goods
It pays to employ a solicitor that specialises in jewellery and luxury goods