Swiss watchmakers optimistic about future

Swiss watchmakers optimistic about future

Although Swiss watch production is widely supported by hi-tech
equipment, a small number of watchmakers remain committed to the
country's centuries-old tradition as the world's best producer of
complicated hand-crafted timepieces. Singapore's Sincere Watch
Ltd invited a number of Asian journalists, including The Jakarta
Post's Rita A. Widiadana, to visit the headquarters and workshops
of Franck Muller and DeLaneau in Switzerland. In the following
three articles Rita reports on her visit.

GENEVA, Switzerland (JP): Watchmaking may be regarded as an
art, but above all it is a science, says prominent Swiss
watchmaker Franck Muller.

"It requires the combination of highly-skilled technology and
artistic talent and I am quite lucky to master them both," said
Muller, one of a dwindling number of hand-crafted timepiece
producers in Switzerland.

During the last few decades, the Swiss watchmaking industry
has been transformed, as the numerous manufacturers have had to
face the challenges and opportunities posed by the development of
quartz technology, in which Japanese competitors got off to a
running start.

"There are only a small number of companies, including mine,
which are still insisting on preserving the tradition of
producing hand-made watches," says Muller.

He conceded that plunging into mass production techniques may
be profitable and in line with international market demands for
cheaper items.

However, Muller sees the trend to do so is a threat to
Switzerland's image as the producer of high-quality timepieces.
Today, Muller says, young people like easy jobs. They work in
various watch factories producing second-rate lines of
timepieces. Only a few youngsters enroll in watchmaking schools
to master traditional watchmaking techniques.

"I am very much concerned about this gloomy situation. It will
really ruin the highly reputable hand-crafted watch industry," he
said.

Born in July l958, Muller showed an interest in mechanical
subtleties at a very early age. When he was 15 years old, he
began studying micro-mechanics and a year later he entered Geneva
Ecole d'Horlorgerie (watchmaking school). After graduating from
that prestigious institution with first-class honors, he began
working as restorer of antique watches belonging to museums,
auction houses and private collections.

Muller later began to design his own watches for several
companies and fashion houses and in l991 he established his own
company.

Since l992, he has been producing watches in two lines -- the
classic model and the cintree curvex model.

Each of his watches is individually crafted in his workshop
and he is personally involved in each stage of the creation
process. Each aspect of manufacture is strictly controlled: the
dials, the watch glass, the movements, the diamonds -- all must
pass stringent quality control tests.

"It needs patience and skill to produce a wristwatch,"
commented Muller, who spent 3,000 hours making one highly-
complicated chronograph watch in l992.

He says his obsession is to pass the tradition of making hand-
crafted watches to Switzerland's younger generation.

To realize his dream, he has recently set up a new workshop in
which he can share and transfer his expertise to talented young
watchmakers.

His new workshop, Franck Muller Atelier, is housed in a neo-
gothic building, formerly known as Les Amandoliers, in Genthod,
outside of Geneva.

He chose to locate the workshop in the heart of the village of
Genthod. This delightful hamlet is perched on a vineyard-covered
hill facing Lake Geneva and offers spectacular views.

"I am quite satisfied with my current effort and I do not
intend to expand my business in the near future. I produce
watches that I like to make, not because the market demands it,"
Muller said at the opening of the atelier last month.

Muller distributes his production worldwide, as far afield as
South America, the Middle East, Asia and Australia.

Potential market

"The sales of my products in Asia is very encouraging. I have
many Indonesian customers but it is very difficult to set up
business there," Muller said.

Francis Habersaat, president of the Federation of Swiss Watch
Manufacturers, is not among those who predict trouble ahead,
particularly in the luxury segment, which some say is reaching
the point of saturation.

"When I see the image of Swiss watches in the world, I am very
confident of the future for all, but we must continue to exercise
creativity in both products and marketing," he says.

Habersaat foresees only modest increases in the luxury watch
market in Europe. The Middle East will be difficult, he says,
because of the economic and political situation. He believes there
is tremendous potential in Asia, where Hong Kong is currently the
biggest market for Swiss watches, recording in 1993 and l994
increases of 14.1 percent and 14.9 percent respectively.

Total sales of luxury watches in l994 were ahead of the
previous year by six percent in volume and eight percent in
value.

There are more and more watch collectors, and there is a
growing number of people who keep a wardrobe of watches for
various occasions. "People today think in terms of a sports
watch, a classic watch, an evening watch," Habersaat says, adding
that the trend is good for business.

DeLaneau

Another Swiss exclusive watchmaking company, DeLaneau, is also
optimistic about the future of hand-made watches and also sees
Asia as potential niche market.

"I have quite a lot of faithful clienteles from Indonesia
including high-ranking government officials, top businessmen and
celebrities," said Rolf Tschudin, owner of DeLaneau, but declined
to name names. DeLaneu's strongest Asian sales are currently in
Singapore, Japan, Hong Kong, Taiwan, Indonesia, Thailand and
Malaysia. In Europe, the company is especially strongly
represented in London.

DeLaneau is one of Switzerland's exclusive jewelry watch
producers run by a husband-and-wife team Rolf and Yolande
Tschudin. Yolande designs the watches while Rolf attends to the
harsh world of business.

The DeLaneau success story began 27 years ago when Rolf, a
descendant of a long-established Swiss watchmaking family, and
Yolande, a daughter of famous artists from Florence, Italy,
founded a watchmaking company in Bienne. At first, they
concentrated on making cheap timepieces. But the competition was
very keen and the prospects far from certain. "We risked the jump
to the top of the price tree. Yet, we are still making a profit,"
Rolf said during afternoon tea at the De Bonmont Chateaux outside
Geneva.

DeLaneau began producing expensive dress watches, at first
under private labels for celebrated jewelry firms like Chaumel in
Paris and Kutschinky of London, then later in their own names.

"It was tough at the beginning. Our premiere collection
included only seven watches and used up all our financial
resources," Rolf said. "The money we earned from it was
immediately reinvested in producing more watches. That is how we
grew. I have never worked on borrowed capital," Rolf added.

DeLaneau achieved its success in the years when the Swiss
watchmaking industry seemed to be dying a slow death. The
Tschudins see themselves more as jewelers than watchmakers. For
more than two decades they have made consistent profits from
producing the most expensive watches.

Their clients include film stars Gina Lollobrigida, Sophia
Loren, celebrities Michael Jackson, Tom Jones and Sammy Davis
Jnr. They also count the sultans of Brunei and Oman among their
customers.

Jewelry design

"I had no idea how much money you can make in this business. I
don't like to talk about turnover and profit," says Rolf.

Yolande says it takes more than a diamond setting to make a
watch which is a piece of fine jewelry.

"Whether set with precious gemstones or not, a timepiece must
be elegant, original and balanced in every detail to be worthy of
the designation "jewelry watch," she adds, while displaying her
most recent jewelry watch collection.

The initial concept for a jewelry watch must take into account
every aspect of its design, from the shape of the case to the
style of the bracelet or strap, and all the materials that will
be used to fashion it, from noble metal to fine leathers and
precious gems, she explained. "I always hold serious discussions
with my staff and my partner before producing a watch," she
added.

Producing jewelry watches involves difficulties faced in no
other sector of the watchmaking industry. A manufacturer must
create an array of dials, different colored straps and a wide
range of settings with a variety of stones for each model it
develops.

Rolf says he has made it his policy to keep the company small.
He employs less than a dozen employees, with much of the
production farmed out to a number of independent workshops and
goldsmiths. Annual production is less than 1,500 watches.
Individual models are produced in runs of no more than 20
watches. The prices range from SFr50,000 to more than SFr 1
million.

"We have never wanted to build up a huge organization; we are
above empire-building. Our only daughter will probably never join
the business. She is trying to establish herself as an art dealer
in Boston, U.S.A.," Yolande said.