President’s Message – November 2013

Dearest member,

As you read this message, you are most likely being asked for those special requests to finish that rush job just before the holiday season – we all know how that is. In my experience, December is always an exciting and busy time with sales and service quite often taking precedence over each other and things can get quite blurry.

Having said this, I will discuss a topic which I have brought up on many occasions since becoming president in August 2012 and that is quality of workmanship and price structure.

By now, many of you who have followed my messages have come to realize this leadership is focused on workmanship of the highest standards. However, standards are hard to define if one is not shown such in a clear manner. Regardless of the number of letters that are printed on this and other pages, the written word does no justice when compared to a close-up picture or image of the item in question.

Last month I discussed the use of the binocular microscope for the watchmaker at the bench. While for many, this is a rather exotic item at or near the workbench, yet for many others, it is a standard item at every watchmaker’s bench. It is an undeniable fact that the human eye has its limitations in viewing small objects; since we live in the world of miniature items a good microscope with a range of 20 to 50 power magnification and with several sources of powerful yet cool lighting, can be of great advantage in ensuring high quality work as well as to help with troubleshooting. Once you experience the advantage of using the microscope, a whole new world of better work will be opened to you and you will not know it until you try it.  

Of course, the usage of the binocular microscope has an initial effect of lowering productivity as the technician sees more things that can be potential problems. With sufficient practice and experience a watchmaker can learn to set up the microscope in a convenient location where efficient use of time is made and only key areas of the movement are verified.

Having touched upon the above where quality workmanship is truly being scrutinized and standards defined, let us talk about what keeps the lights on – the business aspect of the profession.

With higher quality being expected, more time is spent on a task therefore less being accomplished per day; however, it is better quality work that lasts longer and therefore less premature comebacks. The customer wins, the watchmaker wins and the retailer wins in the form of better reputation – this reputation is goodwill which in turn translates into higher sales, the initial reason why the retailer opened the retail store, right? The following line is an interesting concept;

A service center does not necessarily have to be a profit center as long as it is a profit generator.

To explain further, it basically implies a repair center is designed to support the sales of merchandise, in this line, a high level of workmanship is absolutely crucial and as a result, the service center should at the very least break-even or at most make a net profit of approximately 20%. This percentage figure can vary slightly depending on the operation and this age-old formula has worked relatively well for service centers for a long time.

Upsetting this formula is unfortunately quite easy as many managers/retailers like to increase  profit margin, however it comes at the dear cost of quality. The higher the net profit margin, the higher the probability that shortcuts are taken. Shortcuts are easy to take and the most susceptible target is the watch movement itself, where it is hidden from the customer’s view and for that matter it is hard for many watchmakers to assess since they mainly use one eye and a loupe of about 4X magnification. When the façade or the exterior of the timepiece is made the main focus, it becomes an easy way to cover up questionable workmanship.

There is always a shortage of good quality horologists, perhaps it is because their highly valuable skills and knowledge is not always properly remunerated? What is a fair price to charge for a good watch repair you say?

As friend and AWCI member Matt Hritz, CW21 explained to me last year, “if we were to ask the client, how much does it cost to get a haircut?” With that in mind, we calculated if one were to get a haircut on average 10 times a year at an average of $20 per basic haircut – that would translate to $200 per year. Over 5 years it would translate to $1000 spent to maintain one’s hair. The price I am told is much more if you visit a “Hair Stylist/Salon”. If today’s water resistant mechanical watch lasts on an average of five years between services it could be argued the same analogy can be used and this is something many clients can relate to. Now let’s think of what a barber/hair stylist invests in education, tools, equipment and general overhead versus what a watchmaker does and it makes you think about your pricing structure all over again.    

As a closing message for this year I wish you all a safe and happy holiday period enjoyed with your friends and loved ones with continued health and success for the upcoming year. It is my sincere wish that all of you continue to work while striving for the unattainable – perfection. Tools, equipment, workshop setup, education and training are only some parts of the equation, the ultimate goal is the final product and isn’t that what really matters for us?