GENEVA(Dow Jones)--Compagnie Financiere Richemont SA's (CFR.VX) Officine Panerai brand will invest heavily in new boutiques and production in the next year, its chief executive said Wednesday.
The brand, which typically sells watches for about EUR16,000, will add another 15 boutiques by the end of March 2013 to the 33 it already has.
"We are changing our distribution, reducing wholesale and increasing the retail because we are confident retail will be a part of our future," Angelo Bonati told Dow Jones Newswires in an interview at the Salon International De La Haute Horlogerie show in Geneva.
"The new boutiques will improve our sales for sure, but they will also improve our image. Image is more important than sales, especially at the beginning because image produces sales."
Bonati declined to reveal what the current balance was between retail and wholesale revenue for Panerai, but said selling through its own branded boutiques is more profitable.
Four of the new boutiques will be in Asia--in Bangkok, Shanghai, Macau and Hong Kong--with one in Sao Paolo, Brazil. There will also be four more set up in the Middle East and three in North America, with the location of the remainder still to be decided.
"If you don't have your own retail in Asia you are nothing," said Bonati.
The company will also start building a factory in Neuchatel, Switzerland, in March, which will enable it to increase production and improve efficiencies.
Panerai will be recruiting extra staff for the new factory, which is likely to replace an existing plant in the city when it opens at the end of 2013. The company employs 130 people in production, but this could be increased to 300, Bonati said.
Richemont doesn't release sales results by brand, but Bonati said 2011 had been one of the best years for Panerai.
He said he still expected sales growth in 2012, but declined to give figures. "Europe is weak, the U.S. is weak, but Asia is still strong," he said.
Wonder what happen to the KL Boutique? Still opening in KLCC? Anyone?
