Victorinox anniversary, 15.06.2022

Victorinox boss Carl Elsener on the future of the company, the Russian business and counterfeits

The red Victorinox knife is becoming 125 years old. In an interview, company CEO Carl Elsener talks about the success story of the pocket knife and the challenges for the future.

Your great-grandfather Karl Elsener patented the officer's and sports knife 125 years ago.
Carl Elsener: Strictly speaking, it wasn’t a patent, but a design protection. We know this because our company founder copied all his letters into a book by hand. On 12 June 1897, he sent the sample to Bern. That small red pocket knife is the cornerstone of our company.

It’s world famous today. Your great-grandfather must have had a very good entrepreneurial flair. Or was luck also part of it?
Our company founder was certainly a pioneer, and his core values have endured at Victorinox to this day: quality, functionality, innovation and iconic design. But, of course, it always took a good portion of luck, in addition to a lot of hard work,.

What’s the significance of patent protection today?
We spend a six-figure sum annually on patent protection. We face counterfeiting in all five of our product categories, and we have specialised teams operating in the United States, Europe and Asia. If copies or trademark infringements are observed somewhere, we immediately take major action against them. We also work closely with the customs and local authorities.

Does this mean that the problem with counterfeits is getting worse?
It has certainly become more demanding, and we find that ethics and morality have unfortunately decreased in recent years. It has always been very difficult in Asia. If we stop one illegal production, it simply starts up again in another place a few weeks later. The local authorities support us better nowadays, because the local companies also want to protect their products on the world market, so they also act more strictly out of self-interest.

The laws have been tightened In some countries, and certain blade lengths are no longer allowed without conditions.
Yes, I see this as one of the biggest challenges. I’m not directly concerned about gun law, but about the increasing violence in the world, such as the recent horrific rampage in a US school. Our pocket knife is a useful daily companion, but it can be abused by people with negative energy. As soon as an act of violence is committed with a knife, authorities react more sensitively, and laws are tightened.

How does that impact Victorinox?
In the UK, for example, only pocket knives with a certain blade length can be carried. In some cases, certain pocket knives may no longer be displayed in the shop windows. It’s also becoming increasingly difficult online. Customers must be able to prove their age of majority when purchasing a knife. As a result, we sell fewer pocket knives. But we are also confronted with different restrictions in other countries.

Company boss Carl Elsener in conversation with employee Ayten Iriz in the factory in Ibach.

So is the red pocket knife in danger of coming to an end?
No, that’s certainly not the case today. But it is a great uncertainty for me, and we are at the mercy of this development. My great hope is that the world will become more peaceful again. Then it will be better for all of us, including our pocket knife! (laughs) But honestly, it also spurs us on to invest in other product categories. Pocket knife sales slumped by more than 30% after the attacks of 11 September 2001. This painfully showed us how dangerous a one-sided dependence can be. We have reduced this dependency by expanding into other product categories, such as watches and luggage,. As a result, the charisma and visibility of our brand has increased significantly, which has a positive effect on the sales of pocket knives.

Victorinox currently sells knives for the cooking and kitchen sector, as well as travel and outdoor accessories. What's next?
We see the further development and maintenance of our brand as an everlasting process. The new product categories play a decisive role in this. We are currently primarily focusing on internal growth. All five product categories have a healthy growth potential worldwide. We are also open to acquisition, but these must fit in with our strategy. In addition to the Wenger company in 2005, we recently took over the Epicurean chopping board manufacturer in the USA and the Swiss company Zena, which is known for the Rex peeler.

Do you frequently receive such enquiries?
People with brilliant business plans are always coming to us in Ibach. There have been suggestions to sell sunglasses, shoes, office furniture, and even Russian vodka under the Victorinox name. But we don't want overuse our brand.

Speaking of Russia, how much does the war in Ukraine affect you?
It has affected me enormously at a personal level! The war in Ukraine has gripped me with a feeling of helplessness, which caught me completely on the wrong foot. Something happened that I hadn’t expected. I previously had a very different view of Russian President Putin, and thought he was trying to keep the peace, and would not attack a free country with his army.

What impact does the war have on your company?
Costs are exploding in many areas, and we are noticing it, for example, in steel or transport costs. Before the war, we paid $1,000 for a shipping container, but now it costs ten times more. We can still obtain all the materials, but sometimes with great delays. We can thereby only launch certain products later than was planned and was also originally announced.

You also stopped your deliveries after the federal government announced the first sanctions.
Yes that's true. And that was a tough decision for our long-standing local partners. They are not to blame for this incomprehensible war. Considering the plight and suffering of the Ukrainian people, however, our concerns are small. But: Russia was our fifth largest sales market for pocket knives, and we recorded great growth there in recent years.

You will reach retirement age next year. Are you looking for a successor?
I still enjoy the work enormously, but I actually think a lot about how it will continue. I see it as being my responsibility to ensure that our company can move into the next generation. We are also thinking very sustainably in this area – not in terms of annual quarters, but in generations. Eight siblings currently work in the company alongside me, and three additional spouses. Eight family members of the 5th generation, the next generation, work in the company. And there are some candidates who can take on greater responsibility in the company.

For now, however,  you're not thinking about stepping down?
No, I’ll certainly help out for a few more years – if my health allows.

Among the countless variants, which pocket knife is your favourite?
I have two favourites: The Swiss-Champ, a pocket knife that I regularly use in the kitchen at home, and is also one of our bestsellers. And I always carry the Traveller with me.

What are you working on right now?
As a next step, we want to achieve a certain modularity. The customer should be able to change a part of the pocket knife – depending on whether he wants to travel or go to the forest. A pocket knife will soon be on sale with which you can easily open packages and the cable ties – a need that has increasingly arisen during the corona season when shopping online.