Thoughts about the poor
Recently, I read an interview with Karl Lagerfeld in Monocle. In it, he tells Tyler Brûlé that, in terms of what he does for Chanel, he “does not work with the poor”. Lagerfeld, being a prominent fashion designer, is, of course, talking about the fashion industry.
However, it could easily be a quote from a high-end Swiss watch manufacturing CEO, seeing as the costs in the Swiss watch industry are very high, causing the watches to become pretty pricy themselves. In addition to this, the Swiss Franc (CHF) unpegged from the Euro, so Swiss watches just became a lot more expensive, at least for us poor, hapless countries using or linked to the Euro. After SIHH, I did a presentation for 35 Seiko retailers. I started out by telling them that they are all winners, as, undoubtedly, the Japanese watch industry will have a great opportunity when the Swiss counterparts increase their prices by about 10-20%. That got me thinking.
Will we see another Asian invasion like we did during the Quartz Crisis in the 1970-80s? Likely not, as the Swiss watch industry is dominated by corporations who control the production in a completely different way than the way they did 30-40 years ago. Having said that, the Swiss watch industry is being challenged as exports are dropping dramatically, and reduced workweeks were being implemented well before the Swiss currency went through the roof.
But back to Lagerfeld and the whole “not working with the poor” thing. Does the Swiss watch industry need to tighten the belt and lower workers’ salaries in order to compete with global challenges? And, if so, would this have a negative effect on the watches made? Personally, I think not, as I like to think that the highest, most esteemed price of a watch is the emotional value that comes with it. So let’s just suggest something else: lay off the overwhelmingly large numbers of PR-workers who fill our mail boxes with gratuitous nonsense.
And thus relieved of excess cost we can stand back from the currency fluctuations and let the best watch win, letting quality speak for itself and “work with the best” rather than consider if anyone should “work with the poor.”