Officers collared three young men after they threatened staff with knives at the family-owned Junod shop in the Place Saint-François at around 12.30pm.
The men pretended to be customers, but upon entering the premises they brandished the knives and attacked the staff and at least one client, police said.
The thieves, casually dressed in jeans, seized watches from the store’s small watch museum upstairs.
“Once the door was opened, they forced their way in and they took the place by storm with brutality,” Nicolas Goei-Junod, manager of the shop run by the family since 1867, told the 24heures newspaper.
Goei-Junod was not in the shop at the time but he later saw what happened from a surveillance video.
“My father and my sister received blows.”
A customer in the shop was taken to hospital for treatment of minor knife injuries on one hand, police said.
Goei-Junod told 24heures that it seemed like the thieves were targetting a specific group of watches but the ones they took were not of the highest value.
A passer-by alerted police by telephone and officers arrived at the shop just as the bandits were fleeing the shop.
In their haste they dropped some of the stolen goods on the pavement in front of the shop window, police said.
A video shown on the website of Le Matin newspaper shows policemen pinning the three men to the ground, as shoppers look on, before reinforcements arrive in squad cars.
The case remains under investigation. No information about the suspects has been released.
The armed robbery is the sixth of its kind in the canton of Vaud since the beginning of the year.
It follows the hold-up of another jewellery shop in the Place Saint-François in March 2011, but in that case the culprits got away.