An emblematic industry under strain

Switzerland, the world leader by value

Swiss watchmaking maintains its dominant position in the global luxury market. According to statistics from the Federation of the Swiss Watch Industry (FH), about 95% of Swiss watches are destined for export, mainly to the United States, China, and Europe. This dependence on foreign markets makes the industry particularly vulnerable to geopolitical and economic fluctuations.

The Swiss Made label is a major differentiator. Since 2017, the Swissness regulation has required a watch to incorporate a minimum of 60% Swiss value to qualify for this designation, up from 50% previously. Casing, final inspection, and the incorporation of a Swiss movement remain mandatory. These reinforced requirements guarantee quality and authenticity, but also impose cost constraints on manufacturers.

A fragile but complete value chain

The Swiss watchmaking industry rests on three interdependent pillars: the major brands, the specialized subcontractors, and the suppliers of machines and technologies. This pyramidal organization concentrates most of the activity in the Jura Arc, a territory stretching from Geneva to Basel.

In 2024, the sector employs more than 65,000 people, with a slight increase of 0.6% according to the Swiss watch industry employers' association (Convention patronale). The SMEs of the Jura Arc play a crucial role: they ensure the manufacture of essential components such as movements, hairsprings, dials, and exterior parts. Their economic health directly affects the production capacity of the big names in watchmaking.

A sector in constant transformation

The Swiss watchmaking industry has weathered multiple crises: the quartz revolution of the 1970s-1980s, the 2008 financial crisis, the COVID-19 pandemic, and, more recently, the collapse of the Chinese market. In 2024, China recorded a 25.8% drop in its Swiss watch imports, a steeper decline than during the pandemic.

This volatility demands constant resilience. Companies must continually adapt their production capacity, manage their inventory with precision, and anticipate demand variations. In this context, watchmaking planning becomes a major strategic issue.

The major challenges of the Swiss watchmaking industry

Preserving rare watchmaking crafts

Traditional watchmaking trades are experiencing an alarming shortage of qualified candidates. Profiles such as polishers (+54% demand), bevelers (angleurs), watch repairers (rhabilleurs), gem-setters, or microtechnology quality specialists (+24%) are in high demand. This scarcity of skills threatens the transmission of the know-how that makes the reputation of Swiss watchmaking.

The problem is intensifying with the aging of the active workforce. The massive retirements expected by 2030 create an urgent need: new talent must be trained quickly while preserving technical excellence. Initiatives such as the Cercle des Métiers, created in 2022, are trying to address this challenge by offering accelerated, tailored training.

Attracting and training the workforce of tomorrow

Young people's disaffection with technical trades poses a structural challenge. Initial training is sometimes considered too generalist and does not always match the specific needs of companies. Six watchmaking schools (Biel/Bienne, Geneva, Le Locle, Le Sentier, Porrentruy, and Grenchen) offer the watchmaker CFC (Swiss federal vocational diploma) with different specializations: repair, industrial methods, or watch exterior assembly.

Institutions such as the École technique de la Vallée de Joux (ETVJ), opened in 1901, or HE-Arc (Haute École Arc) offer suitable programs. Since 1994, more than 7,000 certifications have been awarded through modular training for adults, demonstrating the importance of continuing education in the sector.

Modernizing production resources

The digital lag still affects many workshops in the Swiss watchmaking industry. Some companies still run on Excel to manage their watchmaking planning, without a consolidated view of their workload or the ability to simulate different production scenarios.

The stakes are multiple: implementing MRP (Material Requirements Planning) and MES (Manufacturing Execution Systems) systems, improving scheduling, ensuring traceability, and managing production bottlenecks. The strong heterogeneity between brands complicates this transformation: each company has its own processes, its specific tools, and varying levels of digital maturity.

For plant managers, planners, and production managers looking for watch production optimization solutions, this modernization becomes essential to stay competitive.

Maintaining industrial competitiveness

Production costs in Switzerland are among the highest in the world: wages, high-tech equipment, real-estate prices in watchmaking areas, and so on. This reality imposes a constant trade-off between artisanal exclusivity and production volumes. Streamlining and partial automation become necessary without sacrificing the quality that makes the reputation of Swiss Made.

The surge in precious-material prices: a major challenge for inventory management

A financial issue that is often underestimated is hitting the Swiss watchmaking industry hard: the explosion in the price of precious materials, and gold in particular. In just two years, the price of gold has doubled, rising from about €55,000 per kilogram in early 2023 to more than €110,000 at the end of 2024. This spectacular surge is upending the economic equation of many watch houses.

For manufactures that produce watches in 18-carat gold — a standard in high watchmaking — each piece now ties up a considerably higher material value. A single gold case can represent several thousand euros of raw material, not counting bracelets, clasps, and other components in precious metals. This increase directly impacts companies' working capital.

In a context of weak growth, or even decline, in the Chinese market (-25.8% in 2024), this issue becomes critical. Companies must now arbitrate between:

•   Building sufficient inventory to meet demand, but tying up considerable capital in precious materials

•   Reducing work-in-progress and inventory to preserve cash, at the risk of being unable to quickly fulfill orders

•   Hedging against price volatility with financial instruments, making management more complex

This tension between cash and inventory puts financial planning and procurement management at the heart of industrial strategy. Finance directors and production managers must work hand in hand to optimize stock levels, reduce cycle times, and improve the rotation of precious materials. Real-time visibility into work-in-progress becomes indispensable to effectively manage this new economic reality.

Gold is not the only one concerned: platinum, palladium, and other precious metals used in luxury watchmaking are also experiencing significant fluctuations. This raw-material instability adds to the industry's other structural challenges and reinforces the urgency of a digital transformation that allows better control of flows and costs.

Ensuring the sustainability of subcontracting

The strong dependence on a few key suppliers weakens the industrial fabric. In the Jura Arc, many SMEs specialized in microtechnology, decoration, or machining are tied to the order books of the major watch houses. When Rolex, Patek Philippe, or Audemars Piguet slow their production, the whole chain suffers.

In 2024-2025, this vulnerability became acutely apparent. Subcontractors saw their orders drop drastically, causing short-time working and concerns about the survival of some businesses. The industrial fabric of the Vallée de Joux, the Bernese Jura, and Saignelégier depends heavily on these mid-sized players.

Responding to new market expectations

Consumers now demand durability, repairability, and transparency. The emergence of connected watches and new materials is shaking up traditional codes. These developments create a tension between technological innovation and the mechanical DNA of Swiss watchmaking, between modernity and respect for centuries-old traditions.

How the Swiss watchmaking industry concretely works

An ecosystem structured in three levels

The major watch houses

At the top of the pyramid are the prestigious watch houses. Rolex dominates with 32.1% of the market (CHF 10.58 billion in revenue in 2024 according to Morgan Stanley), followed by Cartier (CHF 3.18 billion) and Omega (CHF 2.3 billion).

Brands are split between independents (Rolex, Patek Philippe, Audemars Piguet, Richard Mille) and integrated groups (Swatch Group, Richemont, LVMH). This concentration at the top structures the entire organization of the industry.

The component subcontractors

Specialized subcontractors manufacture the essential elements: movements, springs, gears, dials, hands, cases, bracelets, and so on. The Vallée de Joux is particularly devoted to complex mechanical movements, while the Bernese Jura and Saignelégier specialize in cases and exterior parts.

These companies, often family-owned and mid-sized, master ultra-specialized expertise passed down from generation to generation. Their survival depends on their ability to maintain technical excellence while adapting to fluctuations in orders.

The machine and technology suppliers

The third level brings together the manufacturers of CNC machines, electroplating equipment, MRP systems, and watch production optimization tools. These technology players provide the production resources that enable progressive automation without losing artisanal precision.

The phases of watch production: T0, T1, T2, and T3

The Swiss watchmaking industry uses a specific nomenclature to describe the different steps in manufacturing a watch. This classification into T0, T1, T2 (and sometimes T3) phases structures the organization of production and determines where the added value sits in the manufacturing chain. Understanding these phases is essential to grasp the operational complexity of the industry and the planning challenges.

T0 – Manufacturing the components

T0 is the initial phase in which raw materials are transformed into watch parts. It is the step of physically creating the components that will then be used to assemble the movement and the complete watch.

This phase notably includes:

•   The machining of mainplates, bridges, wheels, and pinions

•   The manufacturing of the hairspring and balance wheel, the key parts of regulation

•   Cutting, polishing, and surface treatments

•   The production of various case components, depending on the brand

T0 calls on skills in micromechanics, bar-turning, and high-precision machining. This phase is often outsourced to specialized subcontractors of the Jura Arc, who master the cutting-edge know-how needed to manufacture components with micrometric tolerances.

T1 – Assembling the movement

T1 corresponds to the assembly of the mechanical (or quartz) movement, part by part. It is a critical phase that requires qualified watchmakers capable of assembling dozens, or even hundreds, of tiny components with extreme precision.

T1 operations include:

•   The assembly of the gear train, the escapement, and the barrel

•   The fitting of the balance wheel, an essential element of regulation

•   Meticulous oiling of the friction points

•   The basic adjustment of the movement

At the end of T1, the result is a functional, self-contained movement, capable of keeping time, but not yet cased in its exterior. This phase concentrates a significant share of the Swiss added value and calls on traditional watchmaking trades such as repairers and adjusters.

T2 – Casing and finishing

T2 is the step in which the movement is transformed into a complete watch, ready to be worn. It is a mandatory phase to obtain the Swiss Made label, which requires casing to be carried out in Switzerland.

T2 operations include:

•   Casing the movement into the case

•   Fitting the dial and hands

•   Hermetically sealing the case

•   Water-resistance and resistance tests

•   Final quality and chronometric checks

At the end of T2, the watch is functionally complete and ready for sale. This phase requires skills in casing, dial fitting, and quality control, trades also in high demand on the watchmaking labor market.

T3 – Final dressing and bringing to market

Some manufactures distinguish a final T3 phase, which concerns the last operations before commercialization:

•   Fitting the strap or attaching the lugs

•   Packaging in the presentation box

•   The final running and appearance check

•   Documentation preparation (certificates, warranties)

This T0-T1-T2-T3 nomenclature allows industry players to communicate precisely about the distribution of tasks, the location of production, and compliance with the Swiss Made criteria. It also structures industrial planning: bottlenecks can occur at different phases, and optimizing the flows between T0, T1, and T2 becomes crucial to reduce production lead times while maintaining quality.

In a context of order volatility and pressure on deadlines, mastering the sequence of these phases and their scheduling becomes a key competitiveness factor for Swiss watch manufactures.

Institutions and bodies of the industry

The Federation of the Swiss Watch Industry (FH) coordinates the promotion and defense of the sector's interests. The Swiss watch industry employers' association (Convention patronale) handles social affairs and training. Bodies such as Swisstime or the training centers (ETVJ, HE-Arc, CPNE) structure the educational and regulatory ecosystem.

Geography and regional specialization

The Jura watchmaking Arc is the industrial heart, with 31,400 jobs concentrated mainly in the cantons of Neuchâtel (47%) and Jura (21%). Each area has its specialization:

•   Vallée de Joux: the cradle of high watchmaking, specialized in complication movements with Audemars Piguet, Jaeger-LeCoultre, Breguet, Blancpain

•   Geneva: home to prestige brands and the Geneva Seal (Poinçon de Genève)

•   Neuchâtel / La Chaux-de-Fonds / Le Locle: the historic technical and manufacturing hub

•   Biel/Bienne: a major industrial center home notably to Rolex

•   Jura: subcontracting specialized in cases and components

The 12,850 French cross-border workers employed in Swiss watchmaking demonstrate the cross-border integration of this industry.

The operational challenges and current expectations of the industry

Order volatility on historical markets

Dependence on China, the United States, and Asia exposes the industry to abrupt variations. In 2024, the collapse of the Chinese market (-25.8%) sent a shock wave through the entire supply chain. This unpredictability complicates watchmaking planning: how can production capacity be quickly adjusted in the face of demand swings of +30% or -30%?

The need for more competitive lead times

Accelerating time-to-market becomes crucial. Production directors must better manage work-in-progress, reduce inventory and working capital, while maintaining delivery deadlines. This requirement is in tension with the complexity of watch manufacturing processes.

Anticipate rather than endure: toward modernized planning

The importance of real-time visibility into load and capacity becomes obvious. Companies need dynamic scheduling, rolling watchmaking planning, and tools that make it possible to simulate different scenarios before making decisions.

It is precisely in this context that solutions like Oplit make full sense. By offering advanced scheduling management and complete visibility into resource load, Oplit addresses the specific challenges of watchmaking workshops: managing runs and formats, optimal resource allocation, anticipating bottlenecks, and projecting the completion dates of work orders.

Profitability challenges in an uncertain context

The pressure on margins is intensifying. Companies must optimize their production resources and reduce costs without sacrificing the Swiss Made quality that justifies premium prices. This complex equation requires perfect mastery of industrial processes and a fine ability to analyze performance.

Toward a more agile and more connected industry

From craftsmanship to mastered industrialization

The major challenge is to preserve the artisanal soul of Swiss watchmaking while adopting modern industrial methods. How can the watchmaker's hand, the polisher's precise gesture, and the setter's patience be maintained while accelerating production cycles and reducing costs?

This question runs through every watch house, from family manufactures to international groups. The answer lies in a subtle balance: automating repetitive, low-value-added tasks while retaining expert human intervention on critical operations.

The role of digital tools in the transformation

ERP, MRP, MES, and APS (Advanced Planning and Scheduling) systems are gradually transforming the Swiss watchmaking industry. These technologies make it possible to:

•   Centralize production information

•   Track work order progress in real time

•   Quickly identify drifts and bottlenecks

•   Optimize resource allocation (machines, operators)

•   Simulate different production scenarios

•   Reduce unproductive meeting time

•   Improve communication between supply chain and production

For planners, schedulers, and production managers facing watchmaking complexity, these tools become indispensable. Specialized solutions like Oplit, designed for watch production optimization, offer an alternative suited to the sector's specifics: managing small runs, part traceability, controlling load rates, and visibility into real capacity.

A future to reconcile between know-how and data

The future of the Swiss watchmaking industry lies in the successful hybridization of tradition and modernity. Production data (OEE, throughput, cycle times, scrap rates) become valuable allies for managing the business, provided they are collected, analyzed, and used intelligently.

The digitalization of the watchmaking workshop does not erase the human: it augments them, giving them the means to make better decisions, faster, with a clearer view of the real situation. This transformation nonetheless requires change management, team training, and buy-in from all hierarchical levels.

Conclusion: sustaining Swiss watchmaking excellence

The Swiss watchmaking industry stands at a historic inflection point. Exports reached 25.9 billion francs in 2024, but with a 2.8% decline that reflects the current tensions. The sector's 65,000 employees face intertwined challenges: skills scarcity, market volatility, cost pressure, the surge in precious materials, and growing requirements in terms of sustainability and responsiveness.

For plant managers, planners, schedulers, and production managers, the question is no longer whether to modernize, but how to do so without losing the soul that makes the value of Swiss Made. Watch production optimization requires better visibility into loads, more agile watchmaking planning, rigorous management of precious-material inventory, and tools suited to field realities.

The Jura Arc, with its emblematic valleys such as the Vallée de Joux, its prestigious watch houses, and its dense network of expert subcontractors, has all the assets to meet these challenges — provided it invests in training, adopts the technologies that amplify human expertise, and maintains this close cooperation between all players in the value chain.

The future of Swiss watchmaking is being built today, in the workshops, design offices, and planning rooms where industrial directors and production managers seek daily to optimize their processes. It is in this constant quest for excellence that the key to the sustainability of a know-how unique in the world resides.