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Cortina Watch pushes ahead with expansion plans
CORTINA Watch is not taking a breather, even after opening the world's biggest Patek Philippe boutique in Taiwan. Neither is the Swiss currency shock or a soft market going to slow it.
The Singapore-listed watch retail chain is pushing ahead with expansion plans this year, which includes opening a giant Rolex flagship shop in Marina Square and a multi-brand boutique in Capitol Building as well as expanding its existing Patek Philippe boutique in ION and multi-brand outlet in Paragon.
The Rolex shop will be the single biggest project, involving 5,500 square feet of space for watch displays and events. Renovation costs alone could work out to around S$4 million, according to Cortina's chief operating officer Jeremy Lim.
The shop, which will probably be the biggest Rolex boutique in Singapore, is likely to be ready by year-end.
The multi-brand boutique at the luxury hotel and shopping development at The Capitol is about 3,000 sq ft. It will incur renovation costs of probably S$2 million.
The Patek Philippe boutique at ION will triple its present 800-square-feet size to about 2,900 square feet in July. Renovation is estimated to cost around S$2.5 million to S$3 million. Meanwhile, the Paragon store, which carries brands like Vacheron Constantin, Omega, Longines and Jaeger LeCoultre, will grow from 2,000 sq ft to 2,800 sq ft, Mr Lim said, adding that Cortina may also refurbish its multi-brand outlet at Raffles City.
The retail chain, which made an after-tax profit of S$19 million in its last financial year ending March 2014, could easily spend up to S$10 million or more upfront this year for expansion.
Mr Lim said Cortina has already secured the leases for the new outlets and the added space for expansion.
The expansion comes at a challenging time, but Mr Lim said these are long-term commitments and cyclical swings in the market as well as day-to-day currency fluctuations - including the unexpected surge in the Swiss franc two weeks ago - should not disrupt Cortina's plans.
He thinks customers, fanned by media reports, have over-reacted when they rushed to buy watches in the wake of the rise in the Swiss currency. They had feared prices of luxury Swiss timepieces would also increase, but Mr Lim said this has not happened - and his Swiss suppliers have assured him they have no intentions of raising prices in Asia.
As for the economic uncertainty, which affects spending, he said Cortina's current expansion reflects a more proactive and targeted approach which the retail chain is taking to draw customers into its shops.
"We can't just open the door and wait for them to come in anymore," Mr Lim said.
The bigger boutiques will give Cortina space to hold watch events for invited guests and soft sell directly to big spenders and wealthy customers.
"The advantage of this is we get to know more people and, hopefully, they get to know us," Mr Lim said. "The disadvantage is more work for backend people and we got to have a separate budget for it."
Cortina has adopted the approach at the multi-brand shops but found its effort "diluted" by too many brands, which could cause distractions. It decided to do it in its single-brand boutiques instead.
The problem was these were small. The Patek Philippe boutique at Marina Bay Sands was big enough for functions - and they proved to be successful. But Mr Lim said the location was not popular with the local customers.
Thus the move to expand the Patek Philippe boutique in ION and open a big Rolex flagship store in Marina Square.
READ MORE: Cortina's S$4m investment pays off