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Two Swiss family-owned companies over one hundred years old, global leaders in the production and distribution of high-end watches, which with the operation announced yesterday could change the balance of the entire luxury watch sector. Rolex (which also owns the Tudor brand) has acquired the Bucherer watch chain: since these are private companies, the financial terms of the agreement remain secret, but Vontobel experts estimate an enterprise value for Bucherer of 4 billion francs (about 4 .2 billion euros). According to Jean-Philippe Bertschy, an analyst at Vontobel, Bucherer’s turnover in 2022 reached 2.3 billion francs and 5% of Rolex sales are attributable to the chain’s stores. Even for Rolex, only estimates can be made, but the latest report by Morgan Stanley on the Swiss watch industry has confirmed the supremacy that has lasted for decades: the company, which is based in Geneva and has 30 branches around the world, with 14,000 employees (9,000 of which in Switzerland), closed 2022 with revenues exceeding 9 billion francs (9.4 billion in euros) and a market share of the high-end segment of around 30%, four times that of Omega and Cartier , the other two maisons on the podium.
The uniqueness of Rolex
Rolex’s strong point has always been that of being a pure watchmaking brand: unlike Omega and above all Cartier, there have never been diversifications into jewelery or other types of accessories, however luxurious (especially eyewear , which both Cartier and Omega have instead introduced for several years).
Tight control of distribution
The other characteristic that has always defined Rolex – whose partnership with Bucherer dates back to 1924 – is the control of distribution, which provides for the sale only through authorized dealers and a guarantee of assistance (very expensive but of the highest level) at, in particular, the laboratories of the Geneva office. However, Rolex was among the first maisons to understand the potential of single-brand brands and, while not managing them directly, it invested in very long-term partnerships with high-end multi-brands.
distribution in our country
In Italy – the tenth world market for Swiss-made watches and one of the main ones in Europe for Rolex – the company has entered into agreements with Pisa Orologeria (which manages the Rolex-branded boutique in via Monte Napoleone in Milan, one of the largest in Europe and the world) and Rocca: the chain of watches and jewelers of the Damiani group has just inaugurated the Rolex-branded boutique in Galleria Vittorio Emanuele, also in Milan.
The changes taking place in the sector
The distribution of watches is changing profoundly, both due to the growth in online sales of new and “second wrist” timepieces, and due to the ever-increasing weight of single-brand stores, driven by the investments of the giants LVMH, Swatch Group (which owns Omega) and Richemont (which controls Cartier) for the respective maisons. This also explains the collapse, on the London Stock Exchange, of Watches of Switzerland, a luxury watch company that had closed the 2022-23 financial year in April with revenues up 25% to 1.8 billion euros, whose stock came down 27% on Friday. Hot reactions aside, according to most analysts, from Bernstein to Bloomberg to Reuters, the acquisition of Rolex will accelerate the transition to a D2C (direct to consumer) model, the same followed for other luxury goods, starting with clothing, accessories and jewellery, but it will not change the structure of Bucherer, whose stores offer customers up to 50 watch brands. On the other hand, the space inside the points of sale could increase for second-hand timepieces, which Rolex officially certifies from 2022 to guarantee greater transparency for end customers.