:: Last year at the same time, on these pages, we had already spoken about how Russia is evolving at great speed. In 2004, these changes were in the news more than ever, especially in the domain of watchmaking. Proof can be found in the sixth edition of the Moscow Watch Salon, held in the federal capital from October 19 to 22. The venue this year was an immense new building called the Crocus Exhibition Complex, situated in an outlying area about 30 kilometres from the centre of the city, which is also home to two very popular shopping malls.
Even though the Moscow Watch Salon is intended for the trade, it was also open to private individuals. These visitors come year after year and show their interest in a watch market that, at least in the large cities, continues to grow and diversify: In 2004, despite the distance from Moscow and the relatively high entrance, prices (8 to 9 euros the ticket), a large number of people came to the fair. According to official statistics, individual visitors numbered more than 10,000. “We need to get used to this idea. Russians, as others, are sharing in the globalized economy,” smilingly says Natalya Khimanova, Vice President of Rosinex, the show's organizer. "ln watchmaking, we have rather precise indications of what is happening. In the large cities like Moscow and Saint Petersburg each person owns five or six watches. In the rest of the country, the number is around two or three," adds the dynamic young

woman. "This means that we are no different than consumers in Western Europe, the United States or Asia."
At Rosinex, people say they are convinced that the Moscow Watch Salon will continue to develop and that the large Swiss groups, noticeably absent this year, will come back next year. "In any case, we have some interesting propositions to offer them," declares Khimanova. One thing is sure. Swiss watchmakers must pay careful attention to the commercial offensives launched by the Asians, especially the Koreans. This is true even if they are not competing in the same category of watches.
At the end of the show, a Rosinex spokesperson concluded, "We are satisfied with the exhibition. Most of the goals that we set for ourselves while working and organizing this exhibition were achieved. We have carried out all the negotiations that were important to us. By means of a questionnaire, we have learned the opinions of the participants as well as visitors about the exhibition, giving us the necessary information, induding advantages and disadvantages, to help us improve the show and correct our mistakes in the future."
In this" optimistic context, how will Russian watch manufacturers fare? Their strategies differ according to each

company. To get a better understanding of what they are planning, we spoke with managers at Vostok and Poljot, the two largest brands in the sector.

Vostok: a range for the West

During its sixty-year history and in particular since the fall of the Soviet Union, Vostok has experienced some major upheavals. Despite everything, it continues today with its 4000 employees, who produce movements and quality mechanical watches intended primarily for the domestic market.

For the last two years, however, a subsidiary called Vostok Europe, based in Vilnius, in Lithuania, has been in charge of developing a watch range exclusively for the West European market. The first examples of this new line were unveiled at last spring's Basel Fair. After having undergone some slight improvements, they are offered for sale today.
The Vostok Europe catalogue is particularly interesting. The products are like nothing else, and are attractive by their advanced design, the quality of the materials, and of course by their price. What European brand is capable of proposing automatic watches with an average price of around 150 euros? Additionally, at Vostok Europe, they understand only too well the fashion, which is almost a phenomenon, of products coming

from Eastern Europe. A range is available spotting blatant symbols of the exSoviet Union. The 'Lunokhod' line evokes the first lunar vehicle. 'Pobeda' represents the first mass-produced Soviet automobile. 'Vostok' speaks to the first inhabited space station. 'Komandirskie, embodied the first watch for officers in the Red Army. The 'TU-144' personifies the supersonic Tupolev, while 'K-3 Submarine' characterizes the country's first nuclear submarine. One of the brand's best sellers is the 'Metro' line, epitomizing the city's attractive metro stations.
To sum it up, the brand's universe is essentially masculine, military and technological in nature. But, women also like it, according to Igor Zubovskij, Managing Director of Vostok Europe, who says that he is very satisfied with the response garthered by these collections that have come in from the cold.
Where are the major markets for these watches? The answer is seen in Germany, Portugal, Greece, Spain, Poland, England, the United States, Japan, Switzerland, Taiwan and Singapore. This is why Igor Zubovskij looks to the future with an air of confidence, the persisting economic crisis in Europe notwithstanding. His credo is to continue to distinguish the brand by the design, the quality of the automatic movements and the affordable prices.

The Second life of Poljot
If we had to use only one example to illustrate the upheavals in the Russian economy, we would refer to Poljot. A look at the numbers gives a clear understanding. Before the fall of the Soviet Union, the enterprise had around 6000 employees and produced

more than a million pieces a year.
Today, the factory, which is still located in the centre of Moscow, employs 275 people, while Volmax, the exportation arm of the brand, has 25. Tne group manufactures about 35,000 watches per year, of which 25,000 are chronographs. For the last four or five years, the production has remained stable.
At Poljot/Volmax, there is no mystery surrounding this decline. "The adaptation has been extremely painful. We had to completely rebuild our base from the ground up, especially our export service. Of course, this type of structure already existed, but it did not respond to the criteria of an economy in the global marketplace. This is the reason we created Volmax four years ago," explains Valentin Volodko, its President. From now on, Volmax takes the initiative, decides on the new collections, and directs the creative and design atelier.
After these initial stages, Poljot comes into the picture. This collaboration has borne its fruits. With its eighty years of experience, including the creation of the watch for cosmonaut Yuri Gagarin among others, Poljot possesses an obvious savoir faire and reputation for quality, even though the brand's management says there is still much to do in this domain. "In the years to come, it is on this point that we are going to concentrate our efforts. And, in this respect, we are perfectly open to form partnerships with foreign companies, especially in the technical arena," says Ivan Ksenofontov, chief of Poljot's Department of Strategic Planning.
Poljot has built its success on mechanical watches, in particular chronographs which make up the bulk of its production.

ln a clearly defined marketing strategy, the enterprise proposes timepieces in three collections: 'Buran', 'Aviator', and 'Sturmanskie'. Similar to Vostok, these names resonate masculine, technical, and military overtones. According to the company, this is its style and there is no reason to change its immediately identifiable products.
All the movements are mechanical and produced in Moscow in the workshops located on Marksistskaya street, a name that calls to mind a not-so-distant era. As an anecdotal remark, the nearest metro station is called Proletarskaja. Poljot's very marked Soviet past does not prevent the brand, which is also the largest watch manufacturer in the history of Russia, from now turning entirely towards the future. This future certainly means high quality, mechanical watches at reasonable prices, selling in the range of 250 to 800 euros for chronographs. Still, the brand has not completely left behind its problems. As has been said, it must first of all increase its quality standards. Secondly, it must redevelop its distribution network. Thirdly, it must find and train qualified technicians in Russia to work in the arena of mechanical precision, which seems to be a non-trivial endeavour. According to Ivan Ksenofontov, young people are no longer attracted to this type of werk. One of the possible solutions is to regroup the various players in the sector in order to develop a training organization. The idea is out there. Who knows? Perhaps tomorrow Russia will have its own Watchmaking Federation?

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