Watch sales in Great Britain dipped by 4.7% in January after an unexpected rise of 2.8% in December.
Retailers and brands will be hoping that the economy has turned a corner and growth will resume, although bellwether Watches of Switzerland Group is forecasting that trading conditions experienced in Q3 FY24 in the UK, a quarter in which its UK sales dropped by 7%, are expected to continue for the remainder of the fiscal year, which ends in April.
WoSG CEO Brian Duffy went further in an analyst call, saying that he expects the same trading conditions to last for the whole of this calendar year.
Retail analyst GfK reports sales falling year-on-year in January by 8.8% in London and by 6.2% in the rest of Britain.
The average selling price per watch rose by 8% as the top end of the market continued to outperform the volume segment.
But even the ultra-luxury category for watches priced at over £10,000 was down by 2.9% in January, but remains up by over 11% for the past 12 months.
In contrast, the past year has seen the value of watch sales in the £1,000 to £3,000 price category fall by 20.4%.
Growth in Swiss watch exports to the UK has been significantly outpacing retail sales since the summer of last year, suggesting inventory levels are rising.
For the past two months, growth levels of retail sales and Swiss watch exports to the UK have been more in alignment, which is hopefully a sign that we will not see troubling levels of over-supply, which can lead to discounting.
Globally, Swiss watch exports rose by 3.1% in January.
While the growth in Swiss watch exports continued to slow, it remained at a significant level. Exports in January increased by 3.1% compared with the previous year, to 1.9 billion francs.
There is evidence of a shift in exports towards watches in precious metals, which were up by 13.4% while steel dipped by 2.8% and bimetallic dropped by 3.2%. Steel watches exports totalled 626,000 units in January while only 32,000 precious metal pieces were sold abroad.
The “other materials” category saw exports rise by 11.4% to 341,500 units driven, presumably, by the continuing growth of Swatch with its bioceramic MoonSwatch and other collections.
Most of the main markets saw Swiss watch exports grow in January. The United States (+2.2%) remained positive, along with the majority of Asian and European markets. Hong Kong (-4.7%) and Germany (-11.4%) were notable exceptions.
Highlights included the sharp increase in Singapore (+10.2%) and the twofold increase in watch exports to Qatar (+118.4%), in light of the numerous events planned in the country this year, particularly the Doha Jewellery and Watches Exhibition in early February.
