White Label and outsourcing.
“White Label” refers to the purchase of a completed product, made to custom specifications, normally to be sold forward. This practice has existed since the 17th century, and makers like Thomas Tompion, who has the justifiably exalted reputation of being the ‘Father of English watchmaking’, made over 5,500 watches, a percentage of which were sourced from external suppliers.
Thomas Tompion dial side
Thomas Tompion movement removed from case
An 18K gold open-face pair case verge watch signed Thomas Tompion, London, NO. 57, Circa 1696. (Images supplied courtesy of Christies auctioneers)
By contrast, ‘outsourcing’ is the farming out of a single, particular part of the production to be made to your specifications. Outsourcing is present in every industry. It’s rare that a company can make every part of its product; this would be like a builder making his own bricks, insulation, and roofing materials. Many companies have provided various facilities on a subcontracted basis, with the selling of an entire standard or bespoke movement now common practice. Swiss companies such as ETA, Soprod, and Sellita have historically supplied many brands and private companies wishing to purchase their products. Famously, politics at ETA recently changed, limiting the supply of their mechanical calibres to within the Swatch group only.
While White label products, those complete products produced for a brand by a third party are not unusual and have existed in the industry for many years, at a lower price point, the real turn of events has been the current availability of high-end timepieces. The availability of high-end, high-quality movements and the diversity of complications for White Label is indicative of the period we are living in.
Amongst the companies offering a White Label service are Vaucher Manufacture Fleurier and La Division du Temps (Schwarz Etienne). In addition to these larger companies producing high-quality watches for clients, there are also many small workshops and studios who offer the same type of services but on a less industrial level.
La Division Du Temps ASE 220-00 AUTOMATIC WOUND CALIBRE movement
La Division Du Temps ASE 220-00 AUTOMATIC WOUND CALIBRE dial side
However, with any company producing any product, the product itself is only one link in a chain; even when the product is extraordinary, there is no guarantee that the project will be a commercial success. Watchmaking is a business unlike any other, many successful entrepreneurs from other industries as well as those on the periphery of watchmaking, have failed at developing their brands or revitalising and growing existing ones.
The number of companies offering White Label services will only increase in the future. For those inspired by the idea of using such a service to create their own high-end watch brand, the issue will be where to go, but what they will be receiving. In addition to the careful nurturing of the other links in the business chain. As with all coral reefs, one can behold the beauty of the reef, but in the shadows, the sharks lay waiting.
The eternal problem faced by a small brand producing high-quality watches, whether through a White Label service or a combination of in-house production and outsourcing, is that the same operations and considerations apply whether a company is producing 50 watches in a year or 100,000. Both types of a company require vision and direction, management, development, aftersales service, commercial strategy, intellectual property protection and other legal cover, logistics, packaging, shipping (i.e. back office), quality or consistency control, marketing and communications, accounting, etc. The number of people working within the company might vary, and one person can execute multiple tasks, but all of these tasks need to be completed to some degree.
The positive side to these challenges is that today, because of the paradigm shifts that have occurred, resources are often only a few clicks of a mouse away. The proliferation of Internet-based services has been a game-changer for small businesses wanting to outsource the maximum number of tasks to avoid paying salaries. The only issue here is finding the right people and avoiding those sharks.