Wolf Designs, a leading manufacturer and supplier of jewelry boxes, watch display cases, and watch winders, is expanding into the fine-watch business: In January 2005, Wolf will begin distributing Swiss-made Louis Erard watches in North America to fine jewelers, along with a national ad campaign to introduce the 73-year-old Swiss brand to consumers. It’s the first time the upscale watch line has been sold here. A formal announcement is expected before year’s end.

While some jewelers are reluctant to carry watches, citing low margins and inventory turns, Wolf believes “there’s a good opening here for a high-quality Swiss automatic for men with contemporary styling at a reasonable price [$750 to $2,000 retail, the same as mid-range quartz models, typically $800 to $1,500] that provides our dealers with triple-key mark up,” says Paul Hill, Wolf’s director of business development.

Wolf Designs, a 170-year-old family-owned European business, entered the U.S. market in 1988. Today, it has annual sales of more than $24 million (more than all but the 15 largest watch brands sold in North America) and a U.S. network of some 1,700 accounts, including almost every Rolex dealer. “Our distribution reach is as good as that of any of the finest watch brands,” Hill told JCK.

Not surprisingly, Wolf Designs was actively courted at the recent international watch fair in Basel, Switzerland, by Swiss watch brands seeking American distribution. While interested in expanding its market, the company set some criteria, says Hill: A brand had to be “a high-quality watch” in a price range that fills a void in the U.S. market, and one able to carry a three-time markup “so retailers can make some money.” Wolf believes Louis Erard watches fits all three.

The Louis Erard watch company, which also does watch assembly work for some leading luxury watches, was established in 1931 in La Chaux-de-Fonds in the watchmaking region of Switzerland. It was purchased two years ago by a team composed of seasoned Swiss watch industry professionals—led by Alain Spinedi, former vice president of Swatch International sales—and Swiss investment bankers. They bought the name and production facilities, revamped the business, and restructured distribution to focus on higher-end jewelry stores. The watch company, now located in Noirmont in the Swiss Jura, has a staff of 12 watchmakers and currently produces about 10,000 watches a year.

Wolf Designs’ target market for Louis Erard watches are independent jewelers with a “reasonably good selection of watches from quartz to automatics,” says Hill. The core will be composed of Wolf’s watch-winder clients, about 860 outlets. Wolf’s goal, says Hill, is to “ultimately have the leading watch dealer in each major market in North America carrying and promoting Louis Erard watches.” It expects to initially have 250 to 300 dealers in the year 2005, and 500 to 600 outlets “in a couple of years.” All servicing and support for the Louis Erard watches will be handled by Wolf Design’s Malibu, Calif., headquarters. For more information, visit www.WolfDesigns.com and www.louiserard.ch.

JCK