The pendulum for Britain has swung back to positive, and it’s tourists who’ve pushed it there.Britain was one of the few bright spots for Swiss watch exports in July, rising 13.4 percent from a year earlier and counteracting a massive 26 percent drop in June, according to data published by the Federation of the Swiss Watch Industry on Tuesday. Overall exports dropped for a 13th consecutive month.Richemont and Swatch, whose shares fluctuated after the report was published, will hope the boom in Britain makes up for weakness in other parts of the world.
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Swiss watch exports to the U.K. rose the most in six months as the weak pound drew tourists to Britain.
Locals may be cutting back on the bling as they fret about the impact on their jobs of Britain’s vote to leave the European Union. However, tourists are flocking to the U.K. to take advantage of a weaker pound.For watch sellers, that means they’re having to restock as they sell more luxury timepieces to overseas tourists.There’s a catch — sterling’s slide against the Swiss Franc means retailers have to pay more for their stocks of Rolex, Cartier and Jaeger-LeCoultre watches.
Still, shops seem to be prepared to put up with the higher cost, as visitors from abroad splash out.International tax-free shopping in the U.K. rose 7 percent in July compared to a year earlier, according to Global Blue.
Travelers from Japan, Indonesia and the U.S. accounted for the biggest increases in purchases, while those from Qatar had the highest average spend per transaction. The Chinese are normally big spenders, but a crackdown on extravagance has kept shoppers subdued. Of course the Global Blue figures cover purchases of all items that visitors take back home with them, not just watches. But it just goes to show that the slump in the pound is keeping spending going in Britain.
By Andrea Felsted (Bloomberg)
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