Retailer takes downturn in its stride
Updated: 2015-05-23 06:57
By Agnes Lu in Hong Kong(HK Edition)
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Upmarket Swiss watch retailer F.P. Journe seems to be bucking the lethargic luxury-brand sales trend as affluent mainland clients take a break from their past lavish spending pattern.
"Although we respond to market fluctuations as well, our sales actually have remained quite stable these years," said Stephen Luk, director of F.P. Journe's Hong Kong and Beijing branches and also an adjunct associate professor at Hong Kong Baptist University.
"That means when the market was declining at double-digit percentage speed, we were only mildly affected. But, when the market grew, we didn't taste that sweetness either," he told China Daily.
Geneva-based F.P. Journe puts out less than 900 handcrafted mechanical watches each year for sale at its 10 boutiques and some 40 retailers worldwide.
Including the company's founder Franois-Paul Journe himself, each member of its small in-house team is responsible for making a specific watch according to his technical sensitivity, from beginning to end, including the rating process, casing-up and testing.
It's also the first in the watch worldwide that has realized the movements in its products entirely in 18K rose gold. Each piece is signed with the label Invenit et Fecit (invented and made), meaning the piece is entirely invented, constructed and assembled in the company's Geneva workshops - an inscription tradition dating back to the 18th century for watchmakers to proclaim originality.
The prices of each timepiece range from HK$120,000 to more than HK$5 million, with most of the buyers seasoned collectors and connoisseurs.
"Most of our clients have years of experience in timepieces collection and always look for something exclusive, like something 100-percent handmade," said Luk.
About one-fifth of the customers are from the mainland, who might think it's cheaper to buy the watches in Hong Kong due to its lower taxes.
F.P. Journe opened its Beijing branch in 2009, but it says sales there can never be compared to Hong Kong's as most mainland buyers prefer to go abroad to shop for luxury brands.
Luk explained that the Beijing store is merely for marketing purposes, but it's necessary to be present in one of the world's largest consumer markets although the low-profile brand remains little known to the mainland upper class.
"We see great potential in the mainland market, but it's still very different in running a business on the mainland, such as applying a different operation model."
Although mechanical watches appear to have lost their luster after quartz and electronic watches began dominating the market in the last century, Luk said mechanical watches have made a comeback in recent years.
"In fact, many small brands continue to be acquired by consortiums and the whole market is sort of monopolized. Thus, many timepiece collectors now look for independent watchmakers for special pieces, and that has made us viable in recent years," he said.
F.P. Journe aims to expand in the Hong Kong and mainland markets, but says it would rather host VIP dinners or accumulate word-of-mouth among buyers rather than adopting the traditional way of printing commercials on magazines.
"After all, advertisements are useless to us," Luk said and laughed.
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A watch movement in a F.P. Journe workshop. Although the low-profile brand remains little known to the mainland upper class, about one-fifth of the customers in F.P. Journe's Hong Kong branch are from the mainland. Photo Provided to China Daily |
(HK Edition 05/23/2015 page6)