Why making watches is an uphill battle outside of Switzerland

Buffy Acacia

Ask anybody to name a Swiss product, and they’ll either say chocolates, army knives, or watches. Few countries have such strong ties with any particular kind of manufacturing, let alone specifically watchmaking. Sure, there are heritage brands based in Britain, France, Germany and Japan, as well as the microbrands popping up all over the place, but none of them are set up for success quite like the Swiss. Is there something in the water? Or does history hold an explanation? There are many factors, and none of them are insignificant.

What made the Swiss such good watchmakers to begin with?

Watchmaking’s total history is quite complex, especially around the Middle Ages in Europe when clock towers started popping up. The Islamic Golden Age can also be credited for many advancements in mechanical engineering and mathematics to do with timekeeping, but Switzerland’s part began in earnest in the 1500s. By that point, portable watches were still in relative infancy and only made by curious polymaths or commissioned by wealthy aristocrats. The story goes that when John Calvin banned the wearing of jewellery in Geneva in 1541 as part of the puritanical Reformation movement, jewellers quickly learned how to make watches from French and Italian masters to stay afloat. From then on, a foundation of watchmaking as a core Genevan industry was solidified.

Fast forward to the Industrial Revolution, and Switzerland was uniquely placed to become a watchmaking superpower. Individual workshops often became family businesses, and nearly 300 years of accumulative expertise meant that Swiss watches had gained a great reputation for quality. After railroads were built and workshops developed into factories, the Swiss were able to begin exporting en masse to France, Italy, Germany, England, and even as far as China. Sure, perhaps the artisans of the French and English courts were making more complicated and ornate objet d’art watches for royal families, but they hadn’t quite industrialised in the same way. Most of the Swiss industrialisation methods were actually stolen from the companies of the United States, but while the US was for a time the world’s best maker of pocket watches, years of financial depression, international conflicts, and business mismanagement allowed the Swiss to surge ahead.

How does the Swiss watchmaking industry compare now to other nations?

That short history isn’t to say it’s all been smooth sailing for Swiss watchmaking, as Switzerland has faced its fair share of struggle like any global economy. However, there have definitely been times where Swiss watch exports have supported the nation as a whole. In 2021, 8.6% of all Swiss exports were watches, which was its third-highest category below 50.4% chemicals and pharmaceuticals, and 12% machinery and electronics. That year its watch export value was CHF 22.3 billion, rising to CHF 26.7 billion in 2022. Rolex alone counted for more than CHF 10 billion of that. In terms of actual units, the number hovers around 15 million watches exported per year, with a little under half of them being mechanical.

Given those numbers, it’s a fairly laughable concept that Switzerland has any competitors in global watchmaking. The closest country to be considered competition would have to be China, who exports over 550 million watches per year. That’s over 35x Switzerland’s production, but China’s export value is less than a fifth of Switzerland’s at US$4.8 billion in 2023. The numbers themselves may be shocking, but the theory is not, given that China is a manufacturing powerhouse with a reputation of quantity over quality. Don’t get me wrong, because Chinese watchmaking and general working conditions have been rapidly improving in quality in recent years, but the infrastructure and culture for high-luxury watchmaking just isn’t there. The average price of a single Swiss watch is US$1,679, while the average price for a single Chinese watch is US$4.

The self-fulfilling prophecy of Swiss success

Switzerland’s history and culture that has been built around watchmaking has created a feedback loop of success. Its first watches had good reputations, which led to higher sales, which led to further industry investment, which led to better watches, and so forth. Hypothetical arguments should never be used in place of data, but an example is beneficial to visualise this effect. Suppose you’re a Swiss businessman in Geneva and you’ve always dreamed of working at a watch company. In the unlikely scenario that you don’t have any family connections in the industry, you may even have the resources to start your own brand. A few phone calls to the right people, and you’ll be able to take meetings with designers, factories, and salespeople with decades if not centuries of experience by just driving down the street and seeing exactly where your money is going. Even if you’re not from Switzerland, if you decided to have Swiss Made watches, a plane ticket can get you that same convenience.

Does that sound too good to be true? Of course it’s not that simple, but there are over 700 watchmaking firms in Switzerland, most of them no more than an hour’s drive from one another. They all have relationships with each other too, so that they can share workloads and collaboratively manufacture various components for the final product. It’s also true that some Swiss companies outsource their actual manufacturing of cases, dials and hands from China, but its their knowledge base which allows them to do that without running into big issues with quality control. Another factor is that the Swiss government is heavily involved in regulating its watchmaking sectors, meaning that the industry is supported at a federal level as well as by the wealthy owners. Wristwatch export, import, property expansion, and employment aren’t just concerns for the brands themselves, but a matter of Swiss national importance.

Reliance on the Swiss in other watchmaking countries

A small but optimistic community is the world of British watchmaking which has been having a resurgence. The British Watch and Clock Making Association was founded in 2020 and currently has 105 members, but before that, there hadn’t been much of any large-scale industry since Smiths shut down in the 1970s. Even though there is momentum, there simply isn’t enough demand to warrant the construction of an industrial watchmaking sector when one exists in Switzerland, just a week-long shipment away. Many of the UK’s biggest watchmaking names, including Bremont, Christopher Ward, and Fears still rely on Swiss and Chinese manufacturing even if they’re based in Britain, and even if they make some parts locally. Not everyone can be Roger Smith, making just 12 watches per year by hand.

If we’re talking France, you’re likely talking Swiss as well. Cartier and Bell & Ross are two French brands which are entirely Swiss Made, while other smaller-scale brands like Baltic and Lip use Chinese, Japanese, or Swiss movements with final assembly in France. Even Yema, one of the proudest French brands, has recently announced its flagship Superman diver will now be made in Switzerland (where its case and dial were already being manufactured) to free up more time for its in-house movement production. Granted, there is a greater cultural precedent for independent luxury watchmakers in France, leading to the likes of Remi Cools, Lecomte, and Théo Auffret.

Germany is an interesting case, because while it doesn’t come near China in numbers or Switzerland in value, its watch industry is quite close to the Swiss in spirit. Crammed into the Black Forest region south of Stuttgart and north of the Swiss border there’s Junghans, a once-giant clockmaker now known for its Bauhaus legends in the small town of Schramberg, and then there the pilot’s watch icons of Laco and Stowa in Pforzheim. Still, those brands tend to use Swiss movements. Glashütte is where the ‘pure’ German watchmaking takes place up in Saxony, and its relative distance from Switzerland may explain why the likes of A. Lange & Söhne, Glashütte Original, Union Glashütte, and Nomos Glashütte produce their own in-house movements. Glashütte itself has far stricter laws in place about how much of a watch needs to be made locally for it to earn the name on the dial, so there is a great deal of local pride. Still, it is only a small town with a handful of brands, so it is more like a watchmaking micro-nation than a rival to the Swiss.

You may, understandably, be wondering about Japan. Seiko, Citizen, and Casio are some of the most popular watch brands in the world – especially Casio, which sells more units annually than any other watch brand. But, in 2023, Japan’s export of 49.9 million watches equated to just US$1.87 billion. It’s true that Japan is a watchmaking powerhouse globally speaking, but it is an industry that’s overwhelmingly dominated by just a few vertically-integrated companies who (mostly) produce affordable watches. A brand may easily purchase budget-friendly movements from Seiko or Citizen (a.k.a. Miyota), but outside of that, opportunities are fairly bleak. Of course Japan has its fair share of small, artisanal brands such as Kurono Tokyo, Minase, and Kikuchi Nakagawa, but they don’t make their own movements. Those that do, like Masahiro Kikuno, Daizoh Makihara, and Naoya Hida, certainly charge an appropriately high amount.