Luxury watchmakers this year have experienced an unusually high demand for timepieces, leaving them scrambling to ramp up production in order to keep up. As a result, they have had to delay the release of new collections and invest more to increase production capacity. Some brands reported a spike in sales of up to 73%.
Luxury watchmaker Rolex is one such brand experiencing a similar high demand for its products. Notoriously hard to attain within stores and by authorised dealers, the brand produces roughly one million timepieces a year.
Demand for these items exceeds supply especially for their sports models such as the 'submariner' which retails for approximately 8,500 Swiss francs, reported Bloomberg earlier this week.
Luxury watchmakers face soaring demand, but there isn't enough time
Authorised retailers are usually known to direct customers to alternate competing brands and models when faced with such a predicament. At that, the largest Rolex retailer in the UK is now stating how other luxury watch brands are too facing high demand and similar supply issues.
The head of Watches of Switzerland Group Plc, an authorized dealer for Rolex, Cartier and more stated how the company’s 171 stores across the UK and the US cannot keep up with demand for certain models of Cartier, as well as Tudor — considered a sister brand to Rolex.
Chief Excecutive Officer Hugh Brian Duffy in an interview with Bloomberg stated, “We can’t get enough Santos,” he said of the Cartier aviator watch. “We can’t get enough Tudor,” particularly the brand’s chronograph models, he added.
“We more than doubled our increases with them,” Duffy said, citing Cartier, Swatch Group’s Omega, LVMH’s Tag Heuer, Rolex sister brand Tudor and independent Breitling.
Sales of luxury watches jumped during the pandemic as wealthy consumers directed spending towards collecting high-end timepieces, instead of travel and leisure. As a result, retailers benefited with soaring sales both online and in-store.
However, for the watchmakers, scarcity isn’t that easy to combat. Ramping up production in response to demand is not that simple as luxury watches by their very nature are complicated to produce, requiring time and precision in order to maintain the integrity of the brand.
Of the brands, Cartier – the second-biggest producer of Swiss watches – responded to frustrated customers’ request by promising to shift production to meet demand for popular models to just under three months, cutting it down from the nine or 12 month industry average of production lead time.
Cyrille Vigneron, CEO of Cartier, responded by saying how “We have come to be super fast compared to other big competitors.”
Despite the decline in stocks and cryptocurrencies, Duffy said retail demand for Rolex, Patek Philippe and Audemars Piguet watches continues to outstrip supply.
“Demand is just off the scale for those brands. We would love to have more of them,” he added.