Watches of Switzerland Sees Shift to Home Buyers as Coronavirus Hits

[Chewbacca]

LONDON, United Kingdom — The coronavirus is keeping Chinese tourists away from its London boutiques, British retailer Watches of Switzerland said on Thursday, but local demand for Rolex timepieces is so strong it is making up for the decline.

Tourists from China, where the virus originated in December, have traditionally been the biggest buyers of Swiss watches.

Chief Executive Brian Duffy said in the nine months since the company's initial public offering the share of sales to Chinese nationals had fallen from around 10 percent to 7.8 percent.

"The impact of coronavirus and Chinese tourists not coming has been particularly sensed since the beginning of February," he told Reuters.

"It obviously impacted Chinese New Year plans which are normally a spike in business."

Demand for Swiss luxury watches has been under pressure recently, but Rolex is outperforming other brands, which helps Watches of Switzerland as the number one Rolex retailer in the UK.

Duffy said there was some evidence of brands shipping unsold stock from China to other markets.

"There will be stockbuilding because consumption clearly has reduced in China and a lot of Chinese-dependent markets, Hong Kong and Switzerland probably being the next obvious."

Demand for Rolex, but also Patek Philippe and Audemars Piguet, was so strong there were actually supply constraints, he said.

"So if there's a reduction in one consumer group, it'll be to the benefit of others," Duffy said, adding they'd not had any additional allocation of product yet.

Organisers of the Geneva watch fair said on Thursday they were cancelling their event due to the virus. The rival Baselworld show is still scheduled to take place from April 30.

Watches of Switzerland, which also owns Mappin & Webb, Goldsmiths and US-based Mayors, reported like-for-like sales growth of 8.9 percent for the nine months to January 26. Duffy said he expected a similar growth rate for the full year.

A spokesman explained the slightly slower growth rate in the third quarter of 6.8 percent was mainly due to a Rolex price increase.

The group's biggest shareholder, private equity firm Apollo Global Management, sold a stake worth £118.8 million ($154.37 million) in the retailer last month, reducing its stake to 42.1 percent.

"It's not their business holding major shareholdings in public companies so it's a reasonable expectation they'd sell down over a period," Duffy said.

Shares in the group were down around 1.2 percent at 12.20 pm GMT.

By Silke Koltrowitz; editor: Nick Macfie.


https://www.businessoffashion.com/ar...ronavirus-hits

Link courtesy link owner.

[BumbleB]

Originally Posted by Chewbacca

LONDON, United Kingdom — The coronavirus is keeping Chinese tourists away from its London boutiques, British retailer Watches of Switzerland said on Thursday, but local demand for Rolex timepieces is so strong it is making up for the decline.



Tourists from China, where the virus originated in December, have traditionally been the biggest buyers of Swiss watches.



Chief Executive Brian Duffy said in the nine months since the company's initial public offering the share of sales to Chinese nationals had fallen from around 10 percent to 7.8 percent.



"The impact of coronavirus and Chinese tourists not coming has been particularly sensed since the beginning of February," he told Reuters.



"It obviously impacted Chinese New Year plans which are normally a spike in business."



Demand for Swiss luxury watches has been under pressure recently, but Rolex is outperforming other brands, which helps Watches of Switzerland as the number one Rolex retailer in the UK.



Duffy said there was some evidence of brands shipping unsold stock from China to other markets.



"There will be stockbuilding because consumption clearly has reduced in China and a lot of Chinese-dependent markets, Hong Kong and Switzerland probably being the next obvious."



Demand for Rolex, but also Patek Philippe and Audemars Piguet, was so strong there were actually supply constraints, he said.



"So if there's a reduction in one consumer group, it'll be to the benefit of others," Duffy said, adding they'd not had any additional allocation of product yet.



Organisers of the Geneva watch fair said on Thursday they were cancelling their event due to the virus. The rival Baselworld show is still scheduled to take place from April 30.



Watches of Switzerland, which also owns Mappin & Webb, Goldsmiths and US-based Mayors, reported like-for-like sales growth of 8.9 percent for the nine months to January 26. Duffy said he expected a similar growth rate for the full year.



A spokesman explained the slightly slower growth rate in the third quarter of 6.8 percent was mainly due to a Rolex price increase.



The group's biggest shareholder, private equity firm Apollo Global Management, sold a stake worth £118.8 million ($154.37 million) in the retailer last month, reducing its stake to 42.1 percent.



"It's not their business holding major shareholdings in public companies so it's a reasonable expectation they'd sell down over a period," Duffy said.



Shares in the group were down around 1.2 percent at 12.20 pm GMT.



By Silke Koltrowitz; editor: Nick Macfie.





https://www.businessoffashion.com/ar...ronavirus-hits



Link courtesy link owner.

Interesting, when you walk into their stores they always say you can’t get any popular SS models unless you live there/are a regular/VIP, but in the media they declare that Chinese tourists “have traditionally been the biggest buyers”... that doesn’t seem to add up...


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[singe89]

Originally Posted by BumbleB

Interesting, when you walk into their stores they always say you can’t get any popular SS models unless you live there/are a regular/VIP, but in the media they declare that Chinese tourists “have traditionally been the biggest buyers”... that doesn’t seem to add up...


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I’ve seen Chinese buyers at my local AD buy multiple high end rolexes in a single visit. That probably makes them a VIP for the SS rolexes we all want.

Boutiques at South Coast Plaza have business cards in Chinese on one side and English on the other.

[enjoythemusic]

Originally Posted by singe89

...business cards in Chinese on one side and English on the other.

Normal cards for many professions from the region.

[mykii]

Originally Posted by BumbleB

Interesting, when you walk into their stores they always say you can’t get any popular SS models unless you live there/are a regular/VIP, but in the media they declare that Chinese tourists “have traditionally been the biggest buyers”... that doesn’t seem to add up...


Sent from my iPhone using Tapatalk

They buy a lot of DJs/PMs and models not as popular in the western markets. What is "tacky" to Westerner's is often the sparkle that the East markets love so much. Eastern market places, and customers, simply don't want understated, or SS, in the same way Western markets do.