Source: Media Outreach
Online sales of the luxury watch remain low at only 25% of the total sales for pre-owned luxury watch
Offers authenticity guarantees and certifications by professional and experienced watch appraisers
The venture into the e-Commerce platform would require a total investment of RM250 million, and the response from potential investors has been overwhelming
KUALA LUMPUR, MALAYSIA – Media OutReach – 13 July 2021 – Bursa Malaysia Main Market-listed company Industronics Berhad (“Industronics” or “Company” or “Group”), will tap into the USD17 billion pre-owned luxury watch market with the official launch of its own luxury watch e-commerce platform, watch-exchanges.com (“WatchExchange”), through Ecgo International Limited, its wholly-owned subsidiary in Hong Kong.
WatchExchange is poised to be the first luxury watch e-commerce platform that issues authenticity certificates for pre-owned luxury watches in Malaysia and Asia Pacific. Among some of the leading brands profiled include Audemars Piguet, Hublot, Patek Philippe, Tag Heuer, IWC, Omega, Jaeger LeCoultre, Panerai, Rolex, Breitling.
According to management consultancy, Bain & Company, the global pre-owned luxury watch market was valued at approximately USD17 billion in 2018. However, less than 20% of that market is in the Asia Pacific region, while only 25% of the total pre-owned luxury watch sales were online transactions. Euromonitor International, an independent strategic market research provider, estimates the value of retail sales of timepieces in Malaysia to grow by some 5% per annum between 2019 and 2022, to reach a market value of up to RM2.5 billion.
Industronics Berhad Executive Director Datuk Chu Boon Tiong said: “Based on data and overall market performance, it is evident that the pre-owned luxury watch market has promising growth prospects with a potential boom ahead. We are excited to capitalise on the growing trend with the launch of WatchExchange and aim to pave the way for a streamlined trading platform that will not only revolutionise the transactions of pre-owned luxury watches but drive further growth in this industry.
“As we have seen over the last few years, pricing and demand for pre-owned luxury watches have been so strong that even high-end watch brands are moving into the pre-owned market themselves. However, the biggest challenge for the pre-owned luxury watch market lies in authenticating the watches. Our role here is to ensure that the shoppers can safely purchase luxury watches on WatchExchange without having to worry about the security and authenticity of the pre-owned luxury watches.”
Indeed, the robust primary luxury watch market has fuelled the rapid growth of its pre-owned counterpart. Further, with the increasing trend of monetising timepieces, especially during economic downturns, and the ever-growing demand for luxury goods, pricing and appetite for pre-owned luxury watches have gained traction over the last few years. In May this year, it was reported that Switzerland’s Chronext is preparing an initial public offering (IPO) that would value the online marketplace for new and pre-owned luxury watches at up to EUR1 billion (USD1.2 billion).
Despite the strong demand as evidenced in the pre-owned luxury watch market, only 25% of these transactions were conducted online shows that there is still much room for the online marketplace to grow. In line with current sales and marketing trends, the online space is set to be the primary sales channel for pre-owned luxury watches, raising e-commerce’s share of total pre-owned luxury watch sales eventually to the point of saturation.
Datuk Chu further emphasises that the industry’s biggest challenge is trust, as consumers tend to have reservations about the authenticity of pre-owned luxury goods. As such, Industronics Berhad, with its team of professional and experienced watch appraisers, aims to create a professional, safe trading environment that will elevate the customer experience of purchasing pre-owned luxury watches to a new level. Industronics will also set up offices in China, Hong Kong, Japan, Singapore, Malaysia, the United States, Canada and Europe, where sellers from all over the world could visit for physical appraisals of their watch collections.
“We have a team of professional and experienced watch appraisers, ready to help our customers to evaluate and appraise pre-owned watches. Upon confirmation of its authenticity, the Company will issue a globally recognised certificate to the new buyer. This is very important to ensure the value of the watch remains. It is our goal to ensure authenticity and to gain trust from our customers in order for the Group to achieve revenue growths,” he added.
The success of WatchExchange will depend on excellence in several key areas — stability, sustainability, Search Engine Optimisation (SEO), and new media marketing, all of which will help boost traffic to the Group’s platform. At the same time, the Group will directly benefit from a highly optimised official website and landing page that will set the Group apart from others in a market of homogeneous products. The Group’s venture into e-commerce will require extensive funding, which will be used to develop and enhance the Group’s platform and carry out both online advertising and offline promotional activities.
The Group is looking to set up a fund in Hong Kong to raise a total of RM250 million from potential investors. Proceeds raised will be utilised to purchase different brands of luxury watches for resale on the Group’s platform. Industronics aims to invest around RM25 million or 10% of the total funding required, together with Hong Kong Cyberport Fund, which will invest an equivalent amount as the Group or at a 1:1 ratio. The remainder of RM200 million will be open to other investment groups for investment. Industronics Berhad looks forward to collaborating with all its potential investors in achieving every success.
Datuk Chu believes that the competitive advantage for WatchExchange lies in the ability of the Group to build an entire “unicorn” ecosystem around the region.
“We do not think that the strength of the platform lies solely in the certification and authentication guarantees. We intend to replicate the business models globally via partnerships with a locally listed company in the respective countries. Among the markets that we are looking into are Malaysia, Singapore, Indonesia, Hong Kong, China and several emerging markets in Europe as well. Once our ecosystem matures, we will have so much more to offer to our customers, in terms of the variety of brands, models, and other services,” Datuk Chu said.
– Published and distributed with permission of Media-Outreach.com.
