You are of course all aware by now that the Swatch Group will not supply parts to the free trade as of 1/1/2016, just as all the other watch brands have done for quite a while. We are not happy here at WatchGuy, as we believe that you, the customer, should choose where you get your watch serviced or repaired. As the Swatch Group has 72% (counting ETA movements as well) of the Swiss watch market, this will have huge impact.
We have put together a little survey for Swiss watch customers, and we would really appreciate if you could take the time to fill that in. If we get enough responses, we will submit the results to the Federation of the Swiss Watch Industry in Biel for discussion. You can contact the Federation directly at their web site contact form if you would like to ask them to make spare parts for all Swiss watches available to the independent trade to allow you to make your own decision on where you want your watch serviced.
Please also share the survey link with fellow watch enthusiasts, and post it to forums etc. so that we get a relevant sample size. Thank you all!
Some background information
With the Swatch Group’s decision to stop supplying the independent watch repair trade as of 1/1/2016, no Swiss watch manufacturers are left supplying parts freely.
The Swiss watch industry sells roughly 24 million units each year, including low-end brands such as Swatch and Flik Flak, and the sector that is worth being serviced and repaired (above £700) should be around 15 million units p.a.
ETA supplies 72% of all movements used in the Swiss watch industry, and it sells 24% of the movements it produces to non-Swatch Group companies.
If we assume that a watch lasts an average of 30 years (that is a very low estimate), there are roughly 450 million Swiss watches out there that will need regular service and repair. Let’s again estimate on the low side, e.g. this is due every 10 years, that means 45 million watches require a service or repair every year.
At Swatch Group service prices (starting at about EUR 350 for a simple movement), this is a 3.5 billion EUR market in Europe alone.
Independent repairers charge about half of that for a service, so the savings potential for Swiss watch owners is in the order of 1.75 billion EUR, not taking into account more expensive watches, such as Rolex and high-end Omegas, where the service price is considerably higher.
So far, the independent watch repair industry in Europe has had free access to Swatch Group spare parts, including ETA parts, which has allowed it to employ roughly 15,000 independent repairers in Europe. With Swatch Group threatening to cease supply, independent repairers have to invest close to EUR 50,000 for workshop equipment specified by the Swatch group to obtain a parts account, which would enable them to continue their trade. As most independent watchmakers work on their own, the entry cost is prohibitively high. Rolex prescribes equipment for over EUR 100,000 in order to supply spare parts. Independent repairers already have the necessary equipment to service watches, but not necessarily the exact equipment manufacturers prescribe.
We don’t dispute that watch manufacturers set up a network of accredited service centres, but we think that parts should be sold to independent repairers as well, so that customers can freely choose where they want their watch serviced. Prices at accredited service centres are twice as high as those of the independent trade.
The car service industry has such a two-tier model, which seems to work very well, and the watch service industry lends itself to the same model, taking into account that the average car is far more complex than the average watch.