We haven’t posted in awhile because we’ve been busy working on new models that we hope to introduce this year and working with someone to manufacture a main plate and other parts here in the U.S. The main plate is the first step for us though. This hasn’t been an easy process for us because we don’t have millions of dollars to throw at the project and just make it happen as many have aptly alluded to in posts on different watch forums There’s a capital requirement in this business from manufacturing to marketing. From the U.S. perspective not many companies that don’t have the capital are just going to start cranking out movements here in the U.S. Most companies start out building their brand by using stock movements and cases from different suppliers whether they be Swiss or Chinese and then building the business from there until they can acquire the equipment and parts that they need in order to start in-house manufacturing. One of the most important aspects in this process of building the business to even get to that point is marketing. A brand entering this market is compelled to invest in huge advertising campaigns in order to be identified by the public. Very few people are going to spend hundreds of dollars on a watch if they haven’t heard of your company. I’ll expound on how important this point later. Marketing and communication is undoubtedly the main differentiators between brands. There are 60 watch brands that spend more than $1 million dollars in advertising.
Because we are a small company we have to pace ourselves and sometimes that can be tough in today’s competitive marketplace, so we have to take a much more strategic approach. At one point we thought we were going to be able to move forward at a much quicker pace because we were in discussion with a well known brand who we thought really wanted to work with us as they had reached out to us and wanted to “cross collaborate” and develop a “strategic partnership”. However what we discovered was that they only wanted our narrative, our story for their own, our marketing strategy and any other ideas we were working on that might resonate with the American watch aficionados. We even discussed with them a strategy to where their parent investor should start selling watches with Swiss movements to compete with some of the other brands out there (to which they are doing it now). Numerous emails and telephone calls amounted to seeing our story and our vision wind up being appropriated by them. They even went so far as to use a variation of a company precept that we had in our pitchdeck, “We are an American watch brand dedicated to the resurgence of American Watch Manufacturing”, as a prominent tagline for their website. While this does happen in business a lot and we should consider it a cost of doing business as it’s inevitable that a lot of people will take the free advice and run with it, we want everyone to know we believed in the idea of making things here in America long before it became fashionable, gimmicky and “profitable” to have products “Made in America”. Remember what I said about marketing above, this company has done that. One of the things that we discussed was how to sell a product to Americans without having a recognizable name or history, what we imparted to them was this axiom that we believe and the direction we to take our company, “We believe we can be a change maker as we have the vision, the passion and the dedication to make this a successful endeavor as well as an economic driver for not only a small town, but for U.S. manufacturing in general. We are not selling a consumer product or even a branded product. We are selling an emotional product. We aren’t just offering a style, we are offering a message. Ultimately, we are not just offering watches, we are offering our personal culture. This is about all of us, the re-industrialization of American manufacturing and the resurgence of the American watch industry”. It was a message that they thought would be a powerful marketing message that would resonate with consumers, and as we discovered they used it and made it their own, not for honorable purposes but to make money. If anything we learned a powerful lesson for this, don’t do business with those whom you cannot trust! Or at least get them to sign a mutual non-disclosure agreement.
Many are wondering what we have been doing in order to make watches here in the US, well we haven’t been sitting on our hands if that’s what you’re thinking. As I said at the beginning of the post we are working with someone who is trying to manufacture a main plate and other parts here in the U.S. (I’ll keep everyone updated as we move along in the process). We’ve been out talking with different people, potential investors ( I even pitched a potential investor from Fiumicino – Leonardo da Vinci airport in Rome all the way back to Washington, D.C. at the end of last year). We even participated in Pitch Across Maryland (Maryland Start-up) initiative in September, even though we knew going into it that it was more of a “feel good” initiative for elected officials rather than finding real solutions for start-ups here in Maryland. Hagerstown Magazine wrote a nice article about Pitch Across Maryland’s bus stop (Hagerstown had more participants than any other Maryland county).
Read the article here Hagerstown Magazine Article
For the past year I tried dialoguing with the elected officials here only to find myself talking to, well myself. I know watchmaking is a great way to create jobs because if it wasn’t 59K people wouldn’t be employed by the Swiss Watch industry (for a really great article check out TheJournal’s article on “Who’s behind the success of Swiss watchmaking” ), however the people with whom I’ve been dialoguing with have no interest in creating manufacturing opportunities or job creation, only whether or not you can contribute or impact their re-election . In early January the Washington Post wrote a great article on the state of manufacturing and job creation in Maryland titled “Hagerstown ice cream plant revival attracts hundreds of desperate job seekers“. One of the poignant points of the article I found was the following statistics:
“The country lost 6 million factory jobs between 2000 and 2009, and in Maryland, the job losses have been catastrophic. There were about 172,000 manufacturing jobs in the state in 2000, according to the Bureau of Labor Statistics; today there are about 104,000, a nearly 40 percent drop. In the Hagerstown area, which once produced airplanes, pipe organs and leather car seats, there were roughly 14,000 factory jobs in 2000. Today: about 8,000.”
I also found the following to be quite funny given that our Governor should have been paying attention his entire two terms not just now as he’s on his way out the door as if it’s an after thought (but then again Western Maryland is an after thought to many who live in Annapolis and near the National Capitol Region).
“The staggering job losses have the attention — finally, some workers say — of Maryland Gov. Martin O’Malley (D), who has revived the dormant Maryland Advisory Commission on Manufacturing Competitiveness.”
So where am I going with all of this, one word
We are going to continue to charge ahead in this new year despite the difficulties that challenge any business. We will continue to offer automatic watches at affordable prices and we will continue to surge ahead with our vision, undaunted.
Dont take this post as a negative one because it’s not meant to be as we had a very successful year and some very good positive feedback from our customers, but I wish we could do more in terms of manufacturing here in the US. Regarding our customers I think at some point I’ll start posting those for others to read who may be interested in our brand and would like to know what people who actually own our watches think of them as many people are starting to take notice of our small company. As 2013 ended we were given some surprising unsolicited praise from ASKMEN which I’ll share with you in the next post and in the post after that we plan on unveiling our new project that we’ve been working on the past 8 months called the Hager Trition. Thanks for everyone’s continued support and all the best in this new year. Pete