GRENCHEN, Switzerland — In a downturn, business leaders often talk of continued investments in innovation as keys to unlocking future growth. But as the luxury watch industry’s slowdown continues, Breitling’s chief executive is closing the door on that idea. “We’re going to do more of the same,” says Georges Kern, who has run the private-equity-backed Swiss watchmaker since 2017.

“It doesn’t sound very exciting, but we have a proven concept,” he continues. “Over the last five or six years, the goal was to become relevant because the brand wasn’t relevant anymore. We’ve become a generalist brand that’s cool and relevant and we’ve been growing tremendously.”

Like most Swiss watch companies, Breitling does not publish its results, but according to Morgan Stanley estimates, the company has more than doubled its turnover since Kern’s appointment, growing revenues to 870 million Swiss francs ($976 million) last year. Kern won’t confirm those figures, but points to Morgan Stanley’s report when asked about his company’s performance.

Growth in the Swiss watch sector, however, has since slowed. In 2023, export values reached an all-time high of 26.7 billion Swiss francs, but according to the Federation of the Swiss Watch Industry, values have fallen 2.6 percent and volumes 8.7 percent year-on-year to the end of April.

Kern urges perspective. “Of course, turnover slowed down versus post-Covid,” he says. “But it’s still much, much higher than pre-Covid. Revenge spending after Covid was totally abnormal, not only for the watch industry but for the whole luxury industry. What are we complaining about? We should be very happy about what we have.”

The next step for Breitling, he says, is to build what he calls “esteem” by focusing on the company’s history and its manufacturing capabilities, which he says he is planning to expand. “These elements give reassurance to the consumer, who knows we’re a cool brand but maybe isn’t aware of our manufacturing,” he says.

Kern’s appointment seven years ago surprised the watch industry. He had just been promoted to Richemont’s head of watchmaking, marketing and digital after a successful 15-year stint as IWC’s chief executive and was due to stand for election to the group’s board but was lured away by private equity firm CVC Capital Partners to head up Breitling. Partners Group is now the 140-year-old watchmaker’s largest shareholder.

Breitling, says Kern, had become stuck in a rut, too focused on aviation and pilot’s watches that were pitched with outdated, often borderline misogynistic messaging. In the years that followed, Breitling invested heavily in a rebrand that positioned it as what Kern calls “a casual, inclusive and sustainable” luxury company, and launched an advertising campaign that featured Hollywood A-listers Brad Pitt, Charlize Theron and Adam Driver. Only Theron remains.

“Brad Pitt helped us a lot in changing perceptions of the brand and giving it a more modern touch,” explains Kern. “But after a while the brand had that growth and you don’t need that [Pitt] anymore. With maturity you dress in a different way.”

Kern says a lot of his advertising investment is now in retail following an aggressive boutique opening programme. “This is the biggest marketing tool you can imagine,” he offers. Breitling now has a global network of around 300 monobrand boutiques, many of them franchised, an increase from around 50 seven years ago. Employee numbers have spiked too, rising from 750 staff in 2017 to 1,900 in 2024.

“People want a physical experience,” says Kern. “They can buy sneakers online because they know their size.”

Despite the industry wobble, Breitling is still growing, Kern insists. The pinch, he says, is affecting smaller Swiss watch companies. “Some [smaller] brands enjoyed growth after Covid because there was no stock,” he says, referring to the supply and demand imbalance created by the pandemic, particularly at Rolex. “But now there is stock available, and these smaller brands are suffering much more than the bigger brands. The slowdown is mainly for the smaller and less solid brands.”

The FHS’ figures support the theory. In its most recent report published at the end of May, it indicated that watches with an export value (roughly half retail) of between 500 and 3,000 Swiss francs fell by 10 percent in April, while watches with an export value above 3,000 francs, where most of the big players operate, increased by 7.8 percent. Kern says most of the watches he sells are in the “sweet spot” between 5,000 and 15,000 Swiss francs.

Breitling has been reliant on a strong US economy for years, and Kern says that 20 percent of his sales today are done stateside, making it the company’s number one territory. Even with the uncertainty of the presidential election in November, he says he’s confident the US will continue to prop up Breitling’s business. “Analysts have been talking about a recession in the US for years, but it never happens,” he says. “It’s a very resilient, entrepreneurial, dynamic economy.”

He identifies China as a growth territory for Breitling, and says that, while less than 10 percent of the company’s sales are in the country today, he believes the figure should be 10 to 15 times higher before they “reach our fair share of market.”

Previously, Kern has commented on the industry’s need to invest in the entry-level watch category, beginning around 2,000 Swiss francs, where first-time watch buyers once found household name brands, such as Omega and TAG Heuer, as well as Breitling. But well documented price hikes have lifted Breitling out of this bracket, leaving a big-name brand vacuum.

Kern admits Breitling’s average price point has climbed significantly since his arrival, rising from $5,000 to $7,000. The increase, he says, is down to replacing off-the-shelf third-party mechanical movements with in-house calibres that offer higher performance, the continuing strength of the Swiss franc and inflation. But he concedes that the industry has been guilty of inflating prices.

“I know brands in the watch industry that have been increasing prices dramatically for the same product, and that’s a problem,” he says, without adding a name.

He alludes again to a project that will come to fruition next year and that will give him leverage in a lower price category he believes is still critical to the future success of Swiss watchmaking. “People say all the brands are moving up and there is no business in the lower price points,” he says. “But I don’t believe in this.”

He points to India’s population of 1.4 billion people. “Income levels will grow steadily and many people, before becoming rich, will be first middle class,” he says. “There will be more and more middle class in the world, everywhere. These people might want to buy an analogue watch and not an Apple Watch, but they will start with 2,000 Swiss francs.”

He won’t be drawn on what shape the project will take but says that despite Breitling’s acquisition of the heritage dial name Universal Genève last year, the company’s investors — of which he is one — “don’t have that ambition to become a group.” Instead, they will look to IPO or sell.

As for Kern himself, he says Breitling’s tailwind means he has no intention of hanging up his wings just yet. “Seven years ago, there was no expectation on Breitling and people said I was going to drive it into a wall,” he says. “But what we have from Breitling today is only 20 percent of what I imagined seven years ago.”

FLORENCE — Fashion is on a dangerous trajectory: ideas are scarcer and quality keeps falling while prices continue to soar. There is only so much that marketing pyrotechnics can cover up. Indeed, it was telling that what was most compelling at the 103rd edition of Pitti Uomo, which ended on Thursday, was the Vintage Hub section: a tiny laboratory where visionaries such as Maurizio Donadi of Transnomadica, Roberto Lonoce of Re_javu and Luca Sartor of Riedizione Sartoria keep accumulating and reinventing cherished things from the past.

Upcycling and repurposing are nothing new in fashion and the output of its practitioners is often homogeneous in a crafty and patchy sort of way. But what set those featured at Pitti apart is, on the one side, the streamlined, taut approach to repurposing, and the sense of lived-in elegance that comes out of that; and on the other side, the contagious passion they ooze for clothing, not an ounce of cynicism or thirst for personal overexposure in sight.

In the case of Donadi, a vintage lover and hoarder with a blue-chip resume that includes long stints in product development at both Ralph Lauren and Giorgio Armani, Pitti served as a showcase for cherry-picked, rare pieces that are not even meant to be sold: the indigo-dyed smocks favoured by Henri Matisse and the fauves when painting. Donadi is also the curator behind the very interesting project Fay Archive, which was presented once again in the Fortezza da Basso: faithful reproductions of archive garments from the Diego Della Valle-owned workwear brand, meant as a reconnection to the original spirit of the label, which was born in the early 1980s when Della Valle discovered the jackets worn by a fire department in the US.

Archive feelings are all the rage at the moment. In discombobulating times, fashion becomes more nostalgic than ever. There is a decisive and widespread movement towards the easy elegance of the 1950s and early 1960s: think “The Talented Mr Ripley” and an insouciant brand of spontaneously put together masculinity. Rovi Lucca, a small yet perfectly formed line that caught my attention last season for its gardening ethos mixed with mild informality, went for cheerful visions of Tuscan countryside bliss and rustic elegance. DeNobiliaryParticle, the brainchild of communication wunderkind Paolo De Vivo, exudes a nostalgic and well-to-do feeling too, but it does so with uttermost concentration: the line is all about ribbed crewneck jumpers that look like a cherished family inheritance.

But it was at Paul Smith, who was back at Pitti after 15 years with an atelier-style presentation held in the gilded splendour of Villa Favard, complete with a makeshift Paul’s Bar, that the 50s feelings reached a peak, in a feast of lightness, multipurposeness, pale colours and just a tiny bit of floral embroideries. In other words, it was a playful take on effortless dress up: a quintessentially Paul Smith endeavour, and deliciously so, with the added bonus of Sir Paul himself explaining the looks as the models stood around him in a painter’s atelier situation. The cosy situation amplified the authenticity of the message, and it was a relief.

Pitti has become the occasion for a sort of mini fashion week in Florence, with collateral events added to the traditional calendar. There was nothing small-scaled to the graduation show held by Polimoda, one of Italy’s prominent fashion schools, in the marvellous scenery of the garden of Villa Palmieri. No means were spared, but the show was disappointing in the sense that, although perfectly executed, the collections — 18 in total — all looked cunningly redolent of what fashion is currently offering, with way too many homages to Rick Owens and Vivienne Westwood. Massimiliano Giornetti, formerly at Ferragamo and now dean of Polimoda, is doing a terrific job, but the school needs to divert the attention of the students away from what’s currently in fashion and widen their perspective. The other big fashion school in town, IED, ditched its fashion show in favour of an exhibition curated by photographer Michel Comte whose high concept was as discombobulating as it was stimulating.

With the best thing at Pitti being vintage and upcycling, Marine Serre’s turn as guest designer was well timed. Serre was an early champion of couture-worthy upcycling, but what started a few years ago as a layered exercise in utopian/dystopian dressing for a multicultural world has evolved into a chaotic puzzle of this and that with too little flavour and too much branding. This is a problem many small brands that grow too quickly face: the creative burst gives way to marketing. This was supposed to be Serre’s official debut in menswear, but the show was a co-ed thing as usual, with an emphasis on sartorial men’s pieces with a brashness à la Gianni Versace to them. The setting, however, was fantastic: the decadent Villa di Maiano in Fiesole, with a magnificent view of Florence. The show ended in total white in a plea for peace: a much needed message that nonetheless felt too easy.

More uplifting were those for whom dressing is closer to a form of art — more as an outward expression of inner sentiments than to grab attention — such as Mauro Simionato of Vitelli, an ebullient creative with a brilliant sense of colour, whose use of recycled cashmere fibres is outstanding, and Pierre-Louis Mascia, whose 15-years old label got its very first catwalk exposure at Pitti in the magical spaces of the Tepidarium del Roster.

A former illustrator, Mascia has been an early champion of the eclectic, multi-print look, but he has been very calm in reclaiming it from the copycats. This is why the show, albeit emotional and energetic, felt a bit déjà vu. It was a pity as Mascia’s sense of print is truly singular. Working it all into a different look would have made things fresher.

Paul Smith Spring/Summer 2025

Marine Serre Spring/Summer 2025

Fast fashion retailer Shein, known for its China-made $5 tops and $10 dresses, has hiked prices by over a third on some core products, in a move likely to boost revenues ahead of its planned IPO, according to an analysis of its pricing strategy.

Shein’s average price hikes exceeded those of its rivals H&M and Zara, according to data from London-based research firm EDITED, which compared prices on June 1 with a year earlier.

Shein declined to comment.

The company operates an online marketplace selling an array of merchandise, though its main business is making and selling Shein’s own brands, primarily women’s clothing.

Shein taps a network of largely China-based suppliers, which buck traditional manufacturing processes by taking small initial orders and scaling up based on demand. Most of the clothing Shein sells is made in Guangzhou, China, by its roughly 5,400 suppliers.

Though Shein doesn’t disclose financial data publicly, Coresight Research estimates that Shein’s revenue will reach $50 billion this year, a 55 percent jump over last year’s figure.

Making its core women’s clothing lines more expensive and getting more outside brands to sell on its site can help Shein to hit that sales figure and boost profits.

“Shein has seen very strong momentum recently, which could play favourably into its IPO plans,” said Erik Lautier, e-commerce expert at consultancy AlixPartners.

As Shein prepares for its initial public offering (IPO), it faces the higher costs of being a publicly listed company. It must also comply with new EU regulations on online platforms that could add to its expenses, pressuring profit margins.

In the United States, Shein’s biggest market by sales, the company hiked the average price for women’s dresses by 28 percent in the year to June 1, to $28.51, the EDITED data showed.

While still well below the average for an H&M dress ($40.97) or a Zara dress ($79.69) in the US, Shein upped prices by a bigger percentage than its rivals over the same period, according to the data.

On Shein’s UK site, a dress cost £24.12 ($30.97) on average, 15 percent more than a year ago, while the average dress across France, Germany, Italy, and Spain was 36 percent more expensive.

Shein wants to show that it can sustain its recent growth and sell more higher-priced products ahead of its stock market listing, retail experts say.

“If they can demonstrate that these prices stick then the valuation increases significantly,” said Alex Romanenko, head of retail at pricing consultancy Pearson Ham Group.

Shein is seeking a valuation of around £50 billion in a London listing, Sky News has reported. The company declined to comment on its IPO plans or valuation.

Having gained market share with rock-bottom prices, Shein’s price increases are also aimed at boosting profit margins prior to listing, Romanenko said.

In the US, Shein’s biggest market, the biggest price increase was in footwear, with the average pair of shoes on its site selling for $40.7, up from $25.3 a year ago.

That partly reflects Shein bringing other brands onto the platform, like sneaker brand Skechers, which sells shoes ranging from $32 to $174 on shein.com. Skechers declined to comment on how its sales on Shein have been performing.

Overall, Shein’s growth is bound to slow in its more established markets such as the US and the UK, said Louise Deglise-Favre, apparel market analyst at GlobalData.

“On a global level Shein may be able to sustain similar levels of growth as it continues to enter and develop into new markets, strategically increase some of its prices or through acquisitions,” she added.

The US accounted for 28 percent of Shein’s sales in 2023, GlobalData estimates, with Germany and the UK the second and third biggest markets. Shein also makes significant revenues in Brazil and Mexico, and is growing rapidly in other emerging markets.

However, price hikes can only go so far to boost Shein’s revenues, AlixPartners’ Lautier said, as higher prices typically impact the share of visits to the site that turn into purchases. To drive sales growth further Shein will have to bring more people to its platform, and get them to visit more frequently.

By Helen Reid; Editors: Matt Scuffham and Mark Potter

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