Movado: Running Out of Time?

Movado is shuttering its retail division and closing its branded U.S. retail boutiques by the end of this month.

While the once-revered Swiss watchmaker will retain its New York flagship store, along with 31 outlet stores, the company plans to regroup and focus on selling watches through third parties, including wholesale partners and independent retailers.

Its branded retail stores were opened twelve years ago to sell watches, clocks, pens, fine jewelry, leather goods, and accessories. Closing them will take a $30 million bite out of Movado's revenue, but the division was losing around $10 million annually.

At the same time, Movado announced that it had hired Joe Faranda to become SVP of Consumer Insights and Strategic Planning. Faranda was most recently CMO for International Flavors and Fragrances in New York, and before that he was with Avon Products.

Some market analysts think Movado, which was founded in 1881, will continue to struggle.

Gerson Lehrman Group, a global network of management consultants, published a report yesterday on the brand's challenges.

"Now in the midst of dozens of competing, often better capitalized brands, Movado is faced with what to do with a brand that is too expensive to have mass appeal and not prestigious enough to compete head on with the high end luxury brands," GLG's report commented.

"In times past, the company could look for a new brand to build that fit emerging consumer demand. Now, it has to fit the brand to the customer; i.e., put a square peg in a round hole."

While some Swiss watchmakers are seeing light at the end of a long dark tunnel, one has to wonder if Movado's time has come and gone.