The Swiss watch industry has recently enjoyed extraordinary success. After two excellent years in 2010 and 2011, exports of wristwatches reached a new annual record in 2012 at CHF 20.2 billion (+15%), despite a slight decline in volumes (-2.2%). This discrepancy between value and volume was mainly due to strong growth in mechanical watches (12% by volume while quartz watches decreased by -6%) and a higher proportion of gold watches which resulted in an increase in the average price of watches. As mechanical watches represent around 75% of exports in value for only 25% in volume, an increase of their volume has a substantial impact on the overall average price per watch. While large groups and brands have experienced another year of sales growth in 2012 and had to invest in their production means and hire more skilled labour, small suppliers, being the last link in the supply chain have felt these slowing volumes more directly. If the prospects for growth in the medium and long term remain good, the industry still faces various challenges. The gradual reduction in mechanical movements’ delivery following the COMCO ruling, the shortage of skilled labour, the on-going consolidation on the production and distribution fronts; and the recently increased thresholds to obtain the Swiss Made designation remain factors of uncertainty for many stakeholders.