Czapek Watch Production Update:
This is an important communication regarding our current watch production. If you have a pending order, we encourage you to read this message carefully.
Watches and Wonders 2022 has seen not only the return of the pleasure to meet and greet physically, but also the whole watchmaking industry on fire with an unprecedented demand, especially for independent watchmakers.
We have learned that it is generally understood, that while we are having an incredible number of orders, the whole industry is dealing at the same time with an unprecedented shortage of components. Everyone can imagine, that with complex products like our watches, it is enough if only one of the many parts is not available, to not be able to finish it and deliver to our customers. This is frustrating for us, the same as for you. While we have delivered a total of 180 Watches (across all collections), since beginning of the year, we could see an increase in production and can confirm to have sent a total of 42 Watches during June!
Yet, what do these numbers mean? From 2016 to 2020, Czapek has been manufacturing and delivering roughly 150 watches per year. In 2021, we have manufactured 300 watches out of an order book of 967 pieces. The 667 watches backlog has now turned into 2’400 watches on order, a unparalleled growth. It was sharp, sudden, violent. No one could have imagined the dimension of this growth. We ran out of pieces and components quickly in the second half of 2021 and we re-ordered them. Our supplying partners’ bottlenecks have been preventing us from getting anything before the second half of 2022. We have run an analysis of all the bottlenecks and have immediately started to work on them:
– Space: we needed a new facility for our Manufacture. This was completed on April 20thWe now have a great building of 335 sqm in La Chaux-De-Fonds.
– Supplies: we ran a criticality analysis to identify domino effects (when a small component like the crown is preventing the manufacturing of a larger component like the case) and sourcing risks. We have searched double sources, and if a component source couldn’t be easily replaced and/or had a long lead time we would immediately order in large volumes to create a security inventory. Oscillators turned out to be the riskiest component and we ordered 2’500 oscillators last March. Case crowns are also a sensitive component with a very long lead time. We have double sourced them. For other components, we also have contacted several suppliers to circumnavigate bottlenecks. The tenor is that very few have capacities to take us on as an additional client. Nevertheless we have been able to get a few offers we are currently evaluating and expecting more quotes soon. – Workforce: We have hired one more Watchmaker, which increases our manufacturing capacities to 135 watches per month (given supply). Two more Watchmaker are in the pipeline, to increase our capacity to 200 Watches per month. We are also hiring a new buyer to support our team to better plan and increase the deliveries of components.
We all have in mind that this industry is cyclical and that rushing the assembly of such a technical and artisanal product is counter-productive is terms of quality. We need to pace our growth to make sure we deliver the highest standards of quality that you expect from us. We therefore plan to multiply our output by 2+ every year. This means approximately 600 to 800 watches this year, and 1200 to 1500 watches next year. We will therefore finish to deliver the last pieces of our current order book probably in 2024. This said, we hear and understand your concerns regarding your timepiece manufacturing and delivery and we believe that communication and transparency is key. Thus, we have gathered as much information as we can to provide you with the most complete overview on our future deliveries. This is not perfect but, at least, this is a start, and we are committed to give you regular updates. In order to be as clear and transparent as possible, we will divide this first update by collection, as we have separated production lines for each one of them:
We have a total of 180 assembled and regulated SXH5 movements waiting to be cased and there are more than 600 Hands-Kits waiting to finally show the time. After our case-supplier faced supply-chain issues themselves they have been late with promised quantities. We have a firm confirmation now, that they will be able to provide us with an average of 35 cases for the Antarctique 40.5 per week, starting this week. For the Antarctique S, we will be receiving first cases in week 28. (from July 11th). The same supplier has received a fair number of metal bracelets, which are currently going through quality-control, before being released to us. These were the good news. On the flip side, our dial maker has also delayed significantly its deliveries. We have been informed that all the Ice White dials, all the Deep Blue 12, Glacier Blue 12 and Salmon 12 dials will only be delivered by September. Therefore, we had to modify our production plan accordingly to resume our production.
Our delivery objective: 50 Passage de Drake per month (excluding August, due to Summer holidays), starting from July and then gradually increase.
The assembly of the Rattrapante has proven to be more than twice longer than initially planned, with an additional disassembly and re-assembly being very often required. This has impacted strongly the production capacity and the delay to get the pieces.
Chronode has interrupted the production for 2 month to modify two components: the tube and the axis transmitting the movement to the second and the split-second. The improvement has been marginal and assembly has now been resuming. We have delivered some pieces in June and we will deliver many more in July. All the pieces already delivered have passed successfully the tests. In any case any issue would be taken care of as the usual. The Rattrapante is a high complication, and with high complications, some higher challenges appear. We will resolve them using our “continuous improvement” method which has been very much welcomed in the blogs and forums.
Our delivery objective: all Silver Grey should be delivered by the end of September. When Silver Grey is fully delivered, we will immediately continue with the Ice Blue. The last Ice Blue batch should be delivered in March 2023.
Faubourg de Cracovie
Our cases and calibers inventory for this collection is very low. We have placed orders but the lead times are longer than in the past and the supplying partners are delayed. Here is what we are expecting:
10 calibers will be delivered at the end of each month starting mid-June. We have honored 2021 rose gold orders in priority in June, and then move on to assemble steel chronographs in July. We will get 70 SXH3 movements in 2022 out of the 100 we initially ordered. 500 movements have already been ordered for 2023-24.
Our delivery objective: 70 Faubourg de Cracovie by the end of this year with a 10 per month rhythm.
Quai des Bergues
The release of the SXH1 caliber V2 replacing the V1 version is moving forward and the first 16 SXH1_V2 movements arrived as scheduled (Yes, you might have not heard about this new caliber version but we will officially communicate on it by the end of August, during the Geneva Watch Days. Stay tuned!). 15 more are booked for July 8th, 10 for July 15th and further 10 on July 22nd. After that we have the commitment to get delivery of 30 movements per month between August and December this year. We have already accumulated 40 cases in 38.5 and 20 cases in 42.5. Further 50 cases are expected in September and another 100 in November.
Our delivery objective: production of Quai des Bergues shall resume in early June with a rate of 15 to 20 pieces per month.