Yahoo Sports Tiffany & Co. Ramps Up Production With New French Factory
PARIS — Orest Group, the jewelry manufacturer owned by LVMH Moët Hennessy Louis Vuitton, cut the ribbon on its second jewelry factory in the east of France on Wednesday.
Among the guests to the ceremony in Saint-Dié-des-Vosges that included elected officials and local business leaders was Alexandre Arnault, executive vice president, product, communications and industrial of Tiffany & Co.
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With good reason, most of the additional production power will be dedicated to the American jeweler, Orest’s president Denis De Becker told journalists during a factory visit ahead of the inauguration.
Located in Saint-Dié-des-Vosges, also known as Saint-Dié, a city of 19,000 people in the Vosges department of France’s Grand Est region, the new factory currently employs 200 artisans in its 32,300-square-foot, two-level facility.
It is the culmination of a process that began with the 2021 acquisition of Tiffany & Co. and continued with the 2023 acquisition of Orest’s parent Platinum Invest, a holding company of five workshops that also includes high jewelry specialist Abysse.
“When we saw what the needs we would have for our five-year growth [for Tiffany & Co.], we saw investing in this sector was necessary,” Arnault said. Among the designs that are produced by Orest for the American jeweler is the Lock line, introduced in 2022 and a rapid hit.
The creation of the Saint-Dié factory represents an investment of 7.5 million euros for facilities and equipment, and a total of 10 million euros overall in the region from LVMH, De Becker said.
The jewelry manufacturer specializes in pieces that retail under 100,000 euros and works mainly with diamonds under 2 carats, essentially for pavé. Gold makes up the majority of its output, with platinum taking a 10 percent share.
Platinum Invest said its turnover was 185 million euros in 2023, with Orest’s share at 130 million euros across both sites, with an output of 800,000 pieces from its 1,000 employees. Some 16,000 gemstones are set in its workshop each day.
Almost 50 percent of Orest’s business has come from LVMH-owned houses Louis Vuitton, Dior, Chaumet and Tiffany & Co. since early 2023.
Half of Saint-Dié’s production capacity will be for Tiffany & Co. by next year, and within five years, Arnault expects Tiffany to take up to 50 percent of Platinum Invest’s overall capacity.
“Almost all of the organic growth of the group will be dedicated to [the jeweler],” confirmed De Becker.
Business from its historic clients, which include competitors such as Van Cleef & Arpels and Hermès, is expected to remain stable.
While De Becker would not reveal how many pieces were produced for the American jeweler by Orest, he said that Platinum’s output for the house would amount to 100,000 hours of work this year, a figure that will triple in 2025 and reach 500,000 hours in 2026.
Among the Tiffany products that will come out of the Saint-Dié factory are all-gold designs from the Lock line, which grew from four models to 40 SKUs.
Pavé versions as well as products from the Knot and Line collections are produced 75 kilometers away in Alsace, in Orest’s initial 48,400-square-foot facility with 400 workers in Erstein, which also includes a foundry.
At Saint-Dié, headcount would reach 300 by the end of the year, with around 10 hires a month. A foundry is also being set up, to be operational in June, and represents an additional investment of 600,000 euros.
“And we have the order books for it,” added the Orest executive, revealing it was fully booked for the year. The group has an average annual growth of 15 percent, with a 23 percent leap in 2023 and it has budgeted 20 percent for 2024.
The factory sits on a five-hectare plot previously occupied by Inteva, which manufactured car parts such as locks. Some of its former specialists took part in a reskilling program that saw them join the Orest teams.
While gold and diamond jewelry that comes out of the Saint-Dié factory are covetable, more precious are the skillsets.
“Investing in building and equipment is easy – you just invest a bit of money – but the real need is to train and retain the craftspeople who produce these items of excellence,” said De Becker, touring the “training dojo,” where some 20 apprentices were practicing their skills. Plans for state-recognized training programs are being put in place in partnership with education institutions in the area.
The site could have a maximum capacity of 400 workers, which would be reached in under three years at the current pace, although plans have not yet been put in motion. “We have a year to decide if we need to invest in building further on site or if other units of the group can support the progression,” said De Becker.
By all accounts, especially as the global watch and jewelry market continues to grow, Tiffany will need Saint-Dié’s additional capacity. Its existing U.S. workshops in Pelham, N.Y., and Cumberland, R.I., will continue to focus on its silver jewelry.
During the visit, Arnault said the brand has enjoyed a very good year in 2023, particularly in Latin America and Europe. According to an HSBC estimate released in February, Tiffany & Co. reached 5.4 billion euros in sales in 2023.
At the conglomerate’s 2023 results, LVMH chairman and chief executive officer Bernard Arnault said Tiffany’s operating income had tripled against 2020’s pre-acquisition figures. In that same period, the jeweler has multiplied by five its high jewelry business, which now equals its silver ranges in terms of sales.
Its overall average price has risen by 2.5 to reach $2,000 across all its offers, with gold jewelry averages comparable to competitors such as Cartier and Van Cleef & Arpels.
And that increase did not correlate with the skyrocketing price of gold — it soared past December’s $2,135 per troy ounce record on Tuesday — as Tiffany & Co. prices were only increased by 5 to 7 percent.
The younger Arnault expressed confidence in Tiffany’s outlook for 2024, saying he was “very optimistic” for the Americas, which accounts for 40 percent of sales. Japan, where the jeweler has been present for 50 years and is one of the leaders of the market, remained strong and China is a priority.
Overall, the jeweler will continue to pursue a strategy of image and brand elevation, including in the configuration of its 330-store retail network, which would achieve “a coherent footprint” by the end of 2024, Arnault said.
In addition, to its successful Lock, T, Knot and Hardware collections, the jeweler is planning to lean into the 16 Stones line and the figurative “Bird on a Rock” design by Jean Schlumberger, developing it into categories beyond its initial brooches.
The jeweler will burnish its heritage with “Tiffany Wonder,” the house’s largest retrospective, opening in Tokyo in April. Some 200,000 visitors are expected during the eight-week exhibition that will showcase an array of archival and current designs as well as Schlumberger’s sketches, Arnault said.
Later in April, it will also present its annual Blue Book high jewelry collection, expected to include 175 unique creations, in Los Angeles.
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