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Swiss Take Licking, Keep On Ticking

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TIME was, not so long ago, when Switzerland comfortably dominated the world market for watches and timepieces - as it had for hundreds of years. Then the unthinkable occurred. Along came competitive upstarts from abroad, as Asian (and mainly, Japanese) companies such as Casio began mass-producing not only low-cost watches, but quality products that captured the hearts of consumers.

But if anyone thought the Swiss were about to give up on one of their foremost industries, guess again. Today, it is enjoying a renaissance. The turnaround has to be judged one of the great corporate success stories of the past few decades.

Japan still turns out more timepiece products than Switzerland. But Switzerland now accounts for 50 percent of world watch production in terms of dollar value - $4.3 billion out of total world production of $8.7 billion, according to Peter Laetsch, president of the Watchmakers of Switzerland Information Center Inc. The group is the main industry voice for Swiss watchmakers in the United States.

Part of the long-range Swiss gain is currency-related, but still, Switzerland began recapturing market share in 1985, after a sharp falloff. According to Mr. Laetsch, sales of Swiss timepieces will rise 10 to 15 percent throughout the 1990s. The current strong financial showing is remarkable, considering that the Swiss watchmaking industry has been substantially downsized in recent years. Back in 1970, according to Laetsch, there were some 1,620 watch companies in Switzerland, employing more than 90,000 people. By 1985, however, Switzerland was down to 600 companies with 32,000 employees.

What had happened? The low-wage Asian companies were able to produce attractive products at minimal cost. The Japanese, in particular, were skilled at marketing. But the Asian producers were also quick to exploit the development of the electronic watch, even though the Swiss had developed the process at about the same time, according to Laetsch. ``But we've made the hard days useful; as an industry, we've come out leaner and more innovative. Today, we're copied for our high-quality products and good designs.''

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