< CEO Speak >
A. Lange & Söhne CEO Fabian Krone discloses to Mitrajit Bhattacharya that with understatement being the theme of the times, Richard Lange Pour le Mérite has its heart in the right place
A lot has been said about global meltdown. How do you see it from the top of the luxury category, where quality is more important than quantity?
I wouldn’t really call it a meltdown. I would say that we are having a small hiccup, and hopefully it will not last more than 18 months. Everybody will have to go through it and there is nobody who is not going to be affected. We have not planned any increase in supply and will have to be really careful in the next 12-18 months to manage the after-crisis. I don’t even think it’s a negative thing. I think this crisis is an opportunity for all of us to re-assess our expectations, our beliefs and think about where we have to just re-adjust something.
So it’s more of a correction process than a so-called meltdown?
Yes. We need a slam to wake up. And this a big wake-up call. So let’s get things organised, try to get through these difficult moments and become stronger. That’s the way we are seeing it and that’s how we are preparing.
What are your priorities for the next 18 months? How are they going to be different from the last year?
We have different responsibilities. We have social responsibility towards our employees and retailers, where we have to try to understand where and how to keep them and give them security for the next 12-18 months. They are having a tough time too. As a brand you have a responsibility towards them. So that’s another side of business. And I guess we have to consolidate our products.
When it comes to the product mix, you would have to juggle a bit to get products more suitable for the present.
Yes, something like that. On the other side, we have huge opportunities too. We are still producing only 5,000 time pieces. I would say many countries are having problems, including China, though we are not present there in a big way. Still, there are big opportunities. We have opportunities in India too, where we are not optimally present. We have opportunities in USA where we have only 22 retailers. So there is a geographical potential we have, which we have to address. So the topics for the moment are the employees, new timepieces, new developments and geographical expansion.
You are talking about 5,000 pieces; that’s a very niche brand at the highend. What is your forecast in terms of numbers?
I wouldn’t mind if it even goes down. Why not? The existing retailers are facing difficulties everywhere. I wouldn’t like the Lange watch to be discounted. The other thing is that it’s not always about the numbers. I think at moments like these, we have to re-assess our expectations. We need to prepare for the aftercrisis period. If you try to increase your number at this moment, the future will be very hard. That’s why we are trying to be more solid in the coming months.
That’s realistic, I would say.
If you talk to people around, you will realise that they are losing on their wealth and sometimes even jobs. At moments like these, it’s really hard for a person who has not lost that much, to show off to his friends and his customers, his big flashy gold watch. So it’s also a moment of understatement when you really try to focus more on inner values. I admit that four years ago, when we started developing the Richard Lange Pour le Mérite, we had not planned so. But we’re happy now that we have a timepiece which fits perfectly in this moment, is purely understated from the outside, meaning it has a three-hand dial and enamel, but the inside values are more important.
The past couple of years have seen excellent new launches from you, starting from Lange 31 to Cabaret Tourbillon, which garnered top ratings. What is the high point this year?
Well the Richard Lange Pour le Mérite is definitely the highlight because it has the fusée chain. Apart from that, we have the 1850 which has always been the classical timepiece with the design of the old pocket watches of A. Lange & Söhne, which we had until two-three years ago. We stopped the collection because it was not so much in line with the taste of the customers. As we did not want to put a small movement on a big watch, we developed a complete new movement which fits perfectly in the time piece; it is not a big effort to do a bigger watch without a new movement.