American Swiss is one of South Africa’s leading producers and retailers of jewelry, watches, and diamonds, with a level of prestige that is matched by few other jewelers in the country.
With over a hundred years of history in South Africa, the company has established a strong presence in the country while also becoming something of a style icon among the fashionable elite. The extremely high level of quality and attention to detail that can be found in most American Swiss products have also contributed to its long-standing reputation as a luxury brand name within the jewelry industry.
This video addresses the strategies and business practices that were implemented as the jewelry brand expanded from one store in Cape Town to hundreds of stores throughout the country.
The history of American Swiss is interesting in itself, and is also an almost text-book example of how a small family business can grow into a large corporate organization.
In order for us to understand how American Swiss became one of South Africa’s biggest jewelry retailer, let’s take it back to the year 1896, when a Russian immigrant named Isiah Hirschsohn arrived in Cape Town with a suitcase full of watches, half of which were American and half of which Swiss.
He formed the American-Swiss Watch Company and opened a small shop in Caledon Street.
He ran the business by himself until 1908 when he was joined by his cousin, Mr Rosenzweig, and a malay messenger, Ismail Howell.
In 1912, the American Swiss shop moved to the corner of Parliament and Longmarket Street, and it was there in 1913 that the company was held up by the infamous Foster gang who stole jewellery valued at £5000.
In 1922, Isiah Hirschsohn’s son, Phillip, joined American Swiss, and in the same year, the company launched its own brand of watch, the Union Special, named after the Union Limited Special, a train which ran from Cape Town to Pretoria. A number of advertising gimmicks, including dropping a watch from aeroplanes and tying it to the wheels of trains were used to publicize the watch.
In 1925, Phillip Hirschsohn’s brother, Louis, joined the company and Fast forward 7 years later, it became the first jeweller in South Africa to sell goods on credit.
During World War II, it was difficult to import merchandise from Europe and the store was forced to close two or three afternoons a week. Since jewellery was scarce, the company began to sell other goods, such as curios, and opened a mail-order business to supply other areas within South Africa.
After conclusion of the war, the American Swiss shop in Parliament Street was rebuilt. To pay for this new building, the company tried to expand its business offering by introducing photographic equipment, sports goods, and luggage.
These new lines all proved disastrous and were gradually phased out. At this point there was only one American Swiss store ran by Louis, however, in 1961 the company bought a small business in Burg Street called Van Raan’s, but didn’t rebrand it to American Swiss.
Phillip Hirschsohn’s son, Clive, joined the company in 1949, and from 1962 onwards, assumed the responsibility of running the business entirely. Two years after gaining full control of operations, Clive bought Harris and Co., a shop on the corner of Strand and St George’s Street, while at the same time, the previously bought Van Raan’s was closed down.
In 1965, the company leased a department in a shop in Claremont, FJ Pearce. This move was designed to test the concept of a jewellery store within a large store and was seen as a means of spreading American Swiss stores through the country.
By 1967, the idea proved to be successful and the representatives approached Stanley Lewis of Foschini to put American Swiss into Foschini stores outside Cape Town. Although Foschini had about 100 stores, they turned down the request because the individual Foschini stores were too small at the time.
Soon afterwards, however, Foschini, who had actually been considering diversifying, approached Clive Hirschsohn with a view of taking over American Swiss. Clive realized that with Foschini’s backing, American Swiss could grow rapidly and accepted the takeover offer.
Under the Foschini Group, the company opened a branch in Johannesburg and one in Springs which brought a total of five stores: two in Cape Town, one in Claremont, and two in the Transvaal.
By the late 1960s, American Swiss expanded rapidly and opened ten stores in Pretoria, Hillbrow and Durban. In 1970, the department in FJ Pearce was closed and a new store was opened in Claremont.
The year 1973 saw the company making an unprecedented move in jewellery marketing in the country where it introduced a limited period diamond discount sale, in that period, all regular diamond lines were sold at a 25 per cent discount.
The sale was first tried in three isolated towns: Randfontein, Krugersdorp and Pietersburg. It proved so successful that in 1974, it was extended to Durban and Pretoria, and the following year, was introduced in all stores.
1977 saw the company opening a jewellery boutique in a Foschini store, thus implementing the idea which was originally proposed in 1967 by Clive Hirschsohn.
American Swiss Today
After its rapid expansion in the late 1960s and 1970s, American Swiss today holds a dominant position in the South African retail jewellery industry. Its 235 stores are spread throughout South Africa, the retailer has evolved into the largest watch and jewellery boutique chain in Southern Africa.
Get South Africa’s latest entrepreneurial or business success stories delivered right to your inbox — Sign up to Entrepreneur Hub SA’s newsletter today