The impact of Britain’s Brexit agreement and ongoing cost of living challenges continue to weigh heavily on the watch business, with year-on-year sales dropping by 7% in March, according to retail analyst GfK.
There has only been one month of growth since May of last year, which has left sales down for the full 12 months since April 2023 by 2.3% as Brits continue to tighten their belts and overseas visitors are deterred from shopping in this country because they cannot reclaim the 20% VAT that they get back if they shop on the Continent.
We are not alone. Sales in the United States were down year-on-year by 8.9% in March, data from Luxury Barometer reveals.
Rolex’s chief executive, Jean-Frederic Dufour, expects the majority of small-to-midsize brands to see sales dip by 15%, worldwide this year while larger players can expect a drop of 2-3%.
Swiss watch exports to the UK dropped by 12% in December and 2% in February, but otherwise have been continuing to grow over the past year, suggesting inventory is building up in the wholesale and retail channel and waiting lists for hot watches are shortening.
Sales are suffering at all price points, but the £1,000 to £3,000 and £3,000 to £5,0000 are declining fastest at -31% and -17% respectively.
London and the rest of Great Britain have been registering similar sales declines since May 2023, but the capital had a relatively stronger month in March, recording a year-on-year drop of just -0.2% compares to -12% in the regions.
Online sales are plummeting, and its biggest player, Watchshop, is restructuring after being acquired by Fraser Group.
