Wednesday, September 6, 2023

When Reality Renders Unto Caesar What Is Caesar's...

More official word reached the North Shore offices of Henki Time recently that there was what could be referred to as a "downsizing" of staff at what is reputed to be the biggest, and best media outlet in Watch Town - Hodinkee. You can read a bit more about it here through Watch Pro's coverage -

I say "more official", because in truth? People have either been departing to pursue other professional opportunities, or (to use the more sterile HR terminology) been informed that their position was no longer available for the past year and a half. Obviously some big name departures, and some lesser noticed. And while that had been happening in a slow drip, drip, drip manner, the intensity increased to the point where a fairly major round of redundancies (that's lay-offs to those of you reading in the lower 48) took place this past week. 

And as it is Hodinkee, and as this is (unfortunately) a bellwether for not only watch media, but watch and watch related retail as well, I have to ask an awkward question -

How is it that $40,000,000. US was not sufficient to sustain the pre-existing (reportedly fiscally successful) infrastructure?

One theory mooted via the reporting from Watch Pro is that the downturn in the pre-owned watch market not only created the hole in the bucket, in effect ripped the bottom off it. 

With respect? I call bullshit. 

Hodinkee started life as a media outlet, and in theory still operates as one. It has been the 800 pound gorilla that everyone in Watch Town has had to defer to pretty much since jump street. A glitzy event wouldn't pass by without at least three to four bearded fellows, festooned in heritage brand "bro" togs holding forth on the virtues of God knows what. 

But even prior to the purchase of Crown and Caliber, there were (at least for some of us) always questions as to just how profitable it could be given the sheer head count and fixed operating costs. Or put more plainly? You'd have to sell a lot of MIDOs and Certinas to cover that nut.

The insurance business was another anomaly in the portfolio. I do not have any experience in the ins and outs of insuring watches, but I would have to assume that it would require a fairly robust cash reserve to indemnify all potential claims. Again, just a theory.

So we shall wait, and we shall see. But I will leave George C. Scott as General Patton to provide the closing -

The conqueror rode in a triumphal chariot, the dazed prisoners walking in chains before him. Sometimes his children, robed in white, stood with him in the chariot, or rode the trace horses. A slave stood behind the conqueror, holding a golden crown, and whispering in his ear a warning: that all glory is fleeting.

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