BE WARNED ETA price hikes for movements & parts

[clockboy]

If a company has problems with sales and as a result cash flow problems normally they reduce costs, reduce their products prices or find new markets. However for ETA (Swatch Group) their only solution is unbelievably to hike up their prices. Why ?  well this is parts of an article from this month,s BHI mag. that explains their tale of woe.

 

In 2002 COMCO/Weko ruled that if ETA (part of the Swatch group) wanted to withdraw supply of movements and parts it would be an abuse of it,s market dominance. It then took 10 years to finally agree a gradual reduction of third party supples & by 2016/17 it was authorised to deliver no more than 65% 2009-2011 average production. This agreement also bound ETA not to sell to new customers.

However with the decline of Swiss sales in general ETA have found themselves with cash flow issues. It therefore is in a dilemma it can not sell to new markets so it needed to sell more units & to achieve this it was going to flood the market reduced price units.  COMCO/Weko was then again approached because companies such as Breitling, Sellita, Felsa & Vaucher have re-tooled to manufacture their own movements. Ronda have invested 25 million francs. Technotime’s (who supplied 100,000 balance springs to the industry in 2016) sales director Sebastien Gigonales stated  “you can not take legal action to reduce deliveries, call for alternative solutions then change your position according to market conditions”. COMCO/Weko agreed with this and stated on 26th October it would not entertain the application by Swatch to increase it,s upper limit of delivery of movements.

 

The board at Swatch is therefore in trouble it has dug itself a hole with what seems no way out. It is hoping to resolve its cash flow issue by 

a massive price hike of movements & parts.

 

Swatch has certainly taken steps to protect its business,but its actions have left it alienated and wrong - footed by a fed up horological community . Little solace,perhaps,the old saying:

“Be careful what you wish for,you might just get it”

[Paul78]

Ive noticed the price of ETA movement have gone up steadily over the last couple of years, i was checking though my cousins invoices from 2013 and some of the models have doubled in price.

[Endeavor]

Reads like the Danish postal service ! They slashed the number of mail-boxes by 60%, empties them instead of daily, only on Saturdays and Wednesdays and they doubled the postage cost. A picture postcard to Britain (or within the EU) cost now (2016) close to £3.- !! Wait for it; a raise is due for 2017 .........

If this is indeed the magic trick, I will see my boss, cut my work week by halve and ask him to double my salary ! Better still, work one day and quadruple my salary !! Gosh, I never thought about this one before .......... 

 

Edited December 14, 2016 by Endeavor

[Watchtime]

13 hours ago, Endeavor said:

Reads like the Danish postal service ! They slashed the number of mail-boxes by 60%, empties them instead of daily, only on Saturdays and Wednesdays and they doubled the postage cost. A picture postcard to Britain (or within the EU) cost now (2016) close to £3.- !! Wait for it; a raise is due for 2017 .........

If this is indeed the magic trick, I will see my boss, cut my work week by halve and ask him to double my salary ! Better still, work one day and quadruple my salary !! Gosh, I never thought about this one before .......... 

 

Same with dutch Post....prices have gone through the roof but services have gone below zero due to reorganizations and underpaid postmen.

[Endeavor]

@Watchtime Taking you are from well before 2001, the introduction of the crappy Euro; A decent X-mas card cost here between 15 - 20 kroner (DKK). Postage to Holland 25 kroner. So, sending one (1x) card cost now between 40 - 45 kroner........ that's between fl. 11.60 and fl. 13,- gulders !!!

Ten cards is 130 gulders !! Are you kidding me ............ !! ???

At least postage for a X-mas card from Holland to Denmark is 1.- Euro instead of 3.30 Euro the other way around..... but not to worry, according to the governmental "statistics" there is hardly any inflation

 

 

[Watchtime]

@Endeavor, correct...but see a simple bubble envelope registered to the US, around 16 euro. Parcel to portugal 22 euro...this used to be around 12 euro 1 year ago....But Danish Post certainly is leading with prices...

[Endeavor]

Indeed, prices did increase since I left ........

It's not only with postage "we" are leading. Try to buy a car ! Tax free price + 25% VAT + 200% registration tax. Denmark is one of the, if not the highest taxed country in the world. Think about it when PM Rutte says "we have to look at the Danish model" and the media BS; "the Danish are the most happy people in the world" ............

[mettrelapaix]

On 11/30/2016 at 1:12 PM, clockboy said:

If a company has problems with sales and as a result cash flow problems normally they reduce costs, reduce their products prices or find new markets. However for ETA (Swatch Group) their only solution is unbelievably to hike up their prices. Why ?  well this is parts of an article from this month,s BHI mag. that explains their tale of woe.

 

In 2002 COMCO/Weko ruled that if ETA (part of the Swatch group) wanted to withdraw supply of movements and parts it would be an abuse of it,s market dominance. It then took 10 years to finally agree a gradual reduction of third party supples & by 2016/17 it was authorised to deliver no more than 65% 2009-2011 average production. This agreement also bound ETA not to sell to new customers.

However with the decline of Swiss sales in general ETA have found themselves with cash flow issues. It therefore is in a dilemma it can not sell to new markets so it needed to sell more units & to achieve this it was going to flood the market reduced price units.  COMCO/Weko was then again approached because companies such as Breitling, Sellita, Felsa & Vaucher have re-tooled to manufacture their own movements. Ronda have invested 25 million francs. Technotime’s (who supplied 100,000 balance springs to the industry in 2016) sales director Sebastien Gigonales stated  “you can not take legal action to reduce deliveries, call for alternative solutions then change your position according to market conditions”. COMCO/Weko agreed with this and stated on 26th October it would not entertain the application by Swatch to increase it,s upper limit of delivery of movements.

 

The board at Swatch is therefore in trouble it has dug itself a hole with what seems no way out. It is hoping to resolve its cash flow issue by 

a massive price hike of movements & parts.

 

Swatch has certainly taken steps to protect its business,but its actions have left it alienated and wrong - footed by a fed up horological community . Little solace,perhaps,the old saying:

“Be careful what you wish for,you might just get it”

with this is mind, and for me as a new learner and hobbyist, what do you think about focusing on something like seiko/miyota movements as a foundation?

 

it seems like not long ago the major aim was to become familiar with ETA and swiss movements as a core practice of watch repair. those movements are beautiful and seem to be enjoyable to tinker with. but where does the beginner (such as me) set his or her sights now?

[Blacklab]

Three simple steps in how to put yourself out of business:

1. Restrict your supply.

2. Put your prices up.

3. errr that's it.

[jdm]

22 hours ago, Blacklab said:

Three simple steps in how to put yourself out of business:

1. Restrict your supply.

2. Put your prices up.

3. errr that's it.

Seems to me like Rolex has been happily and successfully ignoring .1 and .2 for the last 50 years.

The Swiss watch industry is not anymore and will not ever be again a mass market industry. They go for high returns. Works good for them.  

Edited December 17, 2016 by jdm