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Home > SAUDI ARABIA > Focus On
WHICHEVER TIME ZONE YOU'RE IN, THE TIME IS ITALIAN
A product that is increasingly becoming a status symbol, the watch is today experiencing a market in constant growth, particularly in the luxury sector. Turnover in the sector in fact grew by 10% in 2006, with business worth €4.67bn, and in 2007-2008 should increase at a rate of 8% per year, also thanks to the growing demand from the United States, as well as China, Arab countries and other emerging markets.
In Italy, in particular, the sector is going through a particularly good period: according to figures published by Assorologi (www.assorologi.it), in 2006 over 8.3m watches were sold, bought by 7.3m Italians, with an average purchase of around €160 per person. This then, is a growth sector, which is increasingly focusing on the top end of the market. It is estimated that in the watch sector on average profit margins are between 10 and 12%. But those at the top of the class achieve margins as high as 25/30%. And it is precisely in the quality market that Italian companies have been operating for decades. The brands are known all over the world, thanks above all to their design, the real strong point of Italian products.
A case in point is the century-old group Binda, which in Italy owns the brands of Wyler Vetta, Tribe by Breil and Breil. In 2005 Binda achieved a turnover of €226m, reaching a record increase of 18% in exports. With consolidated foreign turnover of €66m, Binda has achieved an extremely important goal: basically bringing foreign sales up to the same levels as those at home. This success is due to the impressive number of retail outlets in 40 countries, and by 2008 there are plans for the opening of another hundred points of sale, above all in China. This result is partly due to sophisticated advertising campaigns, but above all to the quality and original design of the products brought out every year.
Morellato, a leader in the production of straps and cases for watches, is also concentrating on the luxury sector. The company has taken over the Sector brand, which also has licences to produce watches under the brands of Roberto Cavalli, Valentino, Moschino and Pirelli PZero. Another interesting case is that of Locman: the watches produced by the company based on the island of Elba (and which now boasts 20 years of experience), have been highly successful in recent years, thanks above all to their distinctive convex rectangular face, as well as the use of innovative materials such as ultralight and resistant carbon.
Exceptional results have also been achieved by Lorenz, who recently consolidated international distribution by entering the Japanese market thanks to an agreement with Orient Watch Co. Ltd of Tokyo (a company with a turnover of €240 million). This is an extremely important step, above all towards obtaining the 20% increase in exports that the company is aiming for, which would take the share of annual foreign sales to 40%. We should also remember the entrance into the watch business of luxury goods producers and fashion houses. Two of the many are Dolce & Gabbana (with D&G Time) and Armani, who have started producing watches with results exceeding all expectations.
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