The Swatch Group is the world’s largest manufacturer of watches. Under the group’s umbrella are 19 watch companies, including Tissot, Omega, Swatch, Breguet and others. Swatch used to operate a Tissot factory in Manaus, a free trade zone in the capital of the state of Amazonas in Brazil, but was forced to shut down because bribes were being demanded. However, now Swatch plans to re-enter Brazil and will be bringing $100 million dollars worth of investment.
The timing of this decision could not better as Brazil was just awarded the honor to host the 2016 Summer Olympics. Nicolas Hayek, the man behind Swatch is scheduled to meet with Brazilian President Luiz Inacio Lula da Silva to discuss Swatch’s investment plans.
Housing one of the largest populations in the world and by far in Latin America, Brazil is a great market with lots of buying power, especially for mid priced watches such as those by Swatch. It is also fair to say that Brazilians will be drawn to the fun, bright colors found in Swatch watches. Other watches sold by brands owned by the Swatch Group, such as Omega and Tissot watches, will also do well in Brazil.
The Swatch Group has a great reputation as a company to work for. In a survey conducted in Switzerland, 3,400 were asked about the image, profile, quality, innovation and emotional components of 112 different Swiss companies. Swatch Group came in at the top.
Its sales also go to show that they are doing well. Despite increases in the cost of materials and production, the Swatch Group continues to expand, open new facilities, and push forward into new markets, such as Brazil. Hayek has stated that “Brazil is the company’s No. 3 market for investment, trailing only Switzerland and Asia.”
It was just announced that the 2016 Olympics Games will be hosted in Rio. Omega Watches, part of the Swatch Group, also recently announced that it will continue to be the official timekeeper of the Olympic Games. Omega has pledged to invest more than $1 billion dollars into sports timekeeping over the next ten years.
The $100 million promised by Swatch Group and the $1 billion promised by Omega is a lot of money, but surely this type of money is worth the advertising that Omega and therefore Swatch will receive in Brazil surrounding the Olympics, making it a win-win for all those involved.
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