Geneva SIHH Report Part 2: The Retailers

As I mentioned in my pre-Geneva report, the first line of meetings during these shows is with retailers.  Right now I have four in North America.

These meetings are a great chance to sit down, look at the full collection, discuss any issues we or they might be having, and plan for the coming year.  This year everyone was in a great mood!  In order to have a happy relationship, I only open points of sale that I am confident can turn their inventory at least once per year.  This means, if you stock five pieces, you must sell at least five per year.  That way everything moves fluidly.  This year all of my retailers turned their inventory at least 1.5x.  And happy clients makes for easy meetings.

We show our retailers the watches we are releasing to the press, but also the next round of launches too.  This way we get the orders in advance so we can deliver as close as possible to the launch.  We pride ourselves on delivering on time.  When we speak about a new piece, it is always nearly ready for delivery.  No “vapor” releases from MB&F.  So here is our launch schedule for this year:

  • Jan/Geneva: HM2 Final Editions (SV-Red, SV-Black)
  • March/Basel: two more variation releases
  • June: new Only Watch piece unique
  • September: HM5 (!!)
  • November: a very fun, funky variation

So now the retailers have seen the first two.  In Basel we will show them the rest.

I’m extremely pleased with how 2010 turned out and expect 2011 to be even better.  I hope this post gave some insight into the nitty-gritty of these shows.

Retailer Week: Manfredi

When I came on board with Max, clearly we needed to open a few more retailers.  The challenge was that we had no connections at most of the stores.  Luckily, I have no shame whatsoever in cold calling or showing up somewhere unannounced.  I would never pressure anyone to become a dealer, either they get it or they don’t, but it was important for me, in the beginning, to at least be acquainted with all of the right players so that they could make their own decisions.

Manfredi is located in Greenwich, CT on the main street of stores.  Greenwich is like a small town, and Manfredi feels like a neighborhood jewelry shop.  It just so happens that the neighborhood is one of the wealthiest in the world, and the store has some of the most spectacular brands and inventory in the country.  The owner, Roberto, has as good a reputation as you will find in this business.  He does what he says when he says 100% of the time – never overextending himself so that he can always follow through on his commitments.  That is a philosophy both Max and I share, so this seemed like a perfect fit.

Before the Geneva show one year, I cold called the store.  I spoke to Roberto who was familiar with MB&F and told me he would let me know if he had time to stop by our suite.  Sure enough, a few days later he called back and made an appointment.  Then he showed up on time for his appointment.  Eventually, after meeting us a few times and feeling comfortable with the brand, he placed an order.  This may all sound simple, but I cannot tell you how often this is not the case.  So many people never call back, miss appointments, keep things hanging.  Or on the other end, we have dealers that we know have no business carrying MB&F who rush in and want to place an order without thinking it through.  Luckily we are not looking to make a quick buck, so we turn them down, otherwise that is how you get too much product out and pieces all over the secondary market.

In any case, here was a guy who was reliable, fully thought through his involvement, committed only after he was sure that we would have a mutually beneficial relationship.  How could we not love it?!  We shipped our initial order there earlier this year – our first representation on the East Coast.  Well worth a short trip from anywhere in the area.

So that’s it for Retailer Week.  I hope it was interesting to hear about how these retail partnerships are formed and what the selection process is like.  In the end, it is all about the people.  Some brands will open any store that will place an order and pay for it.  For us, we want to be in the right places, with the right people who we know will represent the brand properly and can sell a reasonable amount of Machines consistently.  If you start selling to stores that can sell their first few pieces easily but have to majorly struggle and discount to sell any more, it is not beneficial to anyone and kills the brand in the long run.  Again, thanks to Max, I am able to always stay patient, focus on the longterm health of MB&F, and not chase money.  I believe that is one of the most important reasons you will see MB&F as a major player long into the future.

Retailer Week: Lussori

Last year I received an invitation from Lussori to join them in their store during the Pebble Beach car shows.  Generally I turn down offers to appear at stores other than our Authorized Dealers, but this was too good an opportunity to miss.  Their store was on the main street in Carmel – an obvious destination for the biggest gathering of high end car collectors in the country.  That being said, I went in not knowing what to expect.

At the time, I had only two other dealers, Westime in Los Angeles and Berger in Mexico City.  I had no intention of opening another dealer in California, but I went into it with an open mind.  At the very least, it was a great opportunity to show some of our pieces to potential collectors.

I made my first sale within ten minutes of walking in the door – before the store opened.  How?  The owner, Lawrence Kosick saw the Rose Gold and Ceramic HM2-CR that I had with me and it was love at first sight.  From then on, the next couple days were a pleasure.  I got to meet great collectors and the staff at the store could not have been nicer and more accommodating.  Before I left, they asked to place an order and become a dealer.

Lawrence with his HM2-CR on his wrist along with Max and Me

Now I had a dilemma.  Do I open my second dealer in the country, both in California?  It makes no sense.  On the other hand, I like the people involved and I like what they are doing.

Lawrence was an early employee at one of the big Silicon Valley companies.  A watch lover, he decided to open a watch store after he left.  They also have developed CRM software for luxury companies and are at the forefront of online retailing.  While the store was initially in Carmel, the plans were always to move to Silicon Valley – they moved to Los Altos earlier this year.

One of the most fundamental characteristics of MB&F is its focus on people.  Luckily, I have the ability to follow that even in my choice of retailers.  And so, I decided to go with my gut and take the order.  Since then, we have enjoyed a nice relationship, even doing a great dinner event with Max over the summer.  While the choice to have two California dealers looked strange for a few months, now that we have someone on the east coast and with all of the interest we have in the tech world, I think the choice to have a store in Silicon Valley makes perfect sense.  For all of you tech guys, go over and check out some of the Machines!!

Retailer Week: Berger

Rewind back to September 2008.  Max and I had just decided to start MB&F North America.  I knew business and I knew watches, but I had zero experience with the watch business.

The organizer of SIAR, the great watch show in Mexico City, had invited Max to visit the Salon.  It was an invitation that Max was going to decline as he did not have the time in his schedule.  But now that I was on board we could do it.  So, within a few days of starting with the company, I found myself in Mexico City, at a major event representing MB&F.  I gave probably thirty interviews to various press in those few days and met everyone there.  It was truly being thrown directly into the fire and I loved it!

Of course the “Godfathers” of the Salon are the Bergers.  Berger Joyeros is the main jewelry and watch store in Mexico City.  Located on the “Rodeo Drive of Mexico”, it is a family business that is nearly 100 years old.  They carry pretty much every brand you can think of including the big guns, Rolex and Patek.  If we were to ever sell in Mexico, Berger was clearly the store for us.

I was introduced to Mauricio Berger first.  While Ari, his son, now runs the store for the most part, Mauricio is always present and really sets the tone for the entire business.  I was a bit nervous.  The only watch I had with me was my Rose Gold HM2.  What was this older gentleman going to think of such a crazy watch?  I showed it to him half expecting him to wince.  Boy was I wrong.  Mauricio took the watch and started running it around and showing everyone there like a little kid with a new toy.  I knew then that I would get along very well with the Berger family.  Within a few months we took an opening order from them and have been working together very well ever since.

Now Ari, and his nephew Eric, are the ones I deal with the most, but Mauricio still gives us huge smiles every time he sees our new watches.  If you ever find yourself in Mexico City and want to see an amazing inventory of watches from every brand, Berger is worth the trip.  They are working on a major addition that will hopefully be ready to open sometime next year.

Retailer Week: Westime

I thought I would take this week to profile my four North American MB&F Retailers: who they are, why we chose them, etc.  I’ll throw in a Tech Tuesday post tomorrow as well.

At MB&F, our retailers are our “Friends” as well.  We have the luxury of only working with stores that we enjoy working with and respect.  We deliberately keep our dealer network very small to ensure that each of our chosen retailers is able to provide the best service and best selection of our Machines as possible.

Where else to start but Westime.  With two stores in Los Angeles (Beverly Hills and West LA), Westime has become one of the top destinations for watch collectors in the world.  They carry AP and the top Swatch and Richemont brands, but their true niche is the smaller, independent companies.

To explain our history with Westime, we have to go back to the foundation of MB&F.  Max started the company with ~700,000 CHF – his entire savings.  Many watch brands start with ten times that amount and still do not succeed.  He honed his concept and created a plastic model of HM1, then took a trip around the world to meet with his top Harry Winston retailers.  Six of the best stores in the world agreed to take on the brand, relying on the goodwill Max had earned with them during his time at HW.  There was just one problem: that 700k was only half the money needed to deliver the first pieces.  Those six retailers agreed to pay a large percentage of their order up front, a year before delivery.  That is how MB&F was born and is why we do not have any investors or debt.  Westime was one of those original six “Foundation Retailers”.

At that time, the company was run by its founder, John Simonian.  John has since moved further out of the retail part of the business and is concentrating more on Richard Mille USA, URWERK USA, and their other distribution businesses.  His son, Greg Simonian, has taken over.  Although he is young, Greg is doing an incredible job.  He grew up in the store and has an innate understanding of the business.

This is a store that started on the second floor of a mall selling Casios and has worked over decades to become one of the top high-end watch stores in the world.  You have to respect stories like that.  Next year they will be moving their West LA store to an amazing new space in Sunset Plaza.  With an always great selection of MB&F’s as well as my other favorites like Richard Mille and URWERK, Westime is a must-visit if you ever find yourself in LA.