A question of Value

cgaites · Jul 1, 2019

Akendo
As I said, wasn’t expecting to sell, didn’t want to sell. Just curious and had never sold a watch before. So information only. I have no expectations going in other than taking a break from my kids bleeding me dry buying new shoes. Just lending my experience. Hopefully if we all share in good faith it raises all watchers and contributors knowledge base. I’m not a retailer and haven’t watched Dragons Den for a while, so talk of gross margins and the like is wasted on me. I clearly left wiser, knowing this was an avenue closed off if I ever did want to offload.

Reading my post now, it definitely comes off more sounding more "know it all" than I had intended. Tone is a hard thing to get right on a forum. I appreciated your original post, and just wanted to participate in the discussion and contribute information from my time working in the retail industry. Apologies if my note came off as a lecture or some kind of indictment.

Also, for anyone else unfamiliar with the term Gross Margin, it is Revenue - Cost of Goods Sold / Revenue. Or stated in plain English, it is the difference between the selling price of an item and the price a the retailer themselves paid for the item as a percentage of the selling price. Basically, it measure how much a retailer has made on a sale before factoring in costs like rent and the salaries of sales staff.

Akendo · Jul 1, 2019

Much appreciated. Every days a school day. I often think some posts are a little lame, then look back how I’ve written mine....... It’s that never ending journey of discovery we come back for.

tzachi · Jul 1, 2019

Nothing really to discuss. its a business and the % seems reasonable.

Try to sell yourself at the "street" price and see whats the real value you'll get when selling.

One you go the dealer route (easy way?), thats the cost of it.
BTW Its not much different from the % on new watches...

FlyingSnoopy · Jul 2, 2019

Akendo
As I said, wasn’t expecting to sell, didn’t want to sell. Just curious and had never sold a watch before. So information only. I have no expectations going in other than taking a break from my kids bleeding me dry buying new shoes. Just lending my experience. Hopefully if we all share in good faith it raises all watchers and contributors knowledge base. I’m not a retailer and haven’t watched Dragons Den for a while, so talk of gross margins and the like is wasted on me. I clearly left wiser, knowing this was an avenue closed off if I ever did want to offload.

I was under the impression that if the price was right you would trade it...
Anyway, all experience is always welcome...
Cheers

Owlsu · Jul 2, 2019

Shops like this are the same as any pawnbroker or place that buys stuff off people. They'll offer as low as they can without it being so terrible nobody would ever sell it, then they turn around and sell it for higher than the market value.

If they're selling at watch for £2400 they'll offer like £800 for yours and pick up on some microscopic scratch saying it's not quite the quality they usually accept so the price isn't quite what it would normally be or something. Then the next day they'll have it in their window for £2350 listed in as-new condition.

If you did it yourself and went the eBay route or something you could probably sell the same watch for £2100.

SpeedyD · Jul 2, 2019

tzachi
....... BTW Its not much different from the % on new watches...

I have often wondered with WF how they actually justify their prices on some examples as the ‘used’ price is sometimes no better than you can manage in terms of discount on a brand new one with full warranty! I’ve actually picked up a couple of pieces considerable cheaper than WF are selling an older one with only their own 12 month cover.

padders · Jul 2, 2019

Dealers like WF are not a charity, if you presume otherwise you are being naive. Let's look at it from their POV for a minute. On a popular piece like a Rolex sports watch they can probably apply a pretty slim margin, 10-15% maybe since they know they can flip it fast. On a slower seller (like most other brands) if they aren't clearing ~30% of outlay they are not covering their costs and making money since holding stock ties up capital and costs money.

At a guess, when they buy, they start with the market price, then they factor in any remedial work needed, such as replacement parts and servicing (which could easily be £300-600 depending on the watch. Then they apply their margin and work backwards to an offer. So on your typical 5 year old piece, worth say £5K retail as a saleable piece (amazing how many choose to sell at service o'clock) after backing out their preparation costs and margin they may offer ~£3,350. Doesn't sound a lot vs the sale price but thats how it works. A newer piece may need less work but used leather straps and scratched cases are routinely replaced or improved and that costs money.

Oh and if they already have 2 or 3 of a given model in stock, don't be surprised if they apply a larger eg 35-45% margin, since it makes selling the new example even less likely...

Taddyangle · Jul 2, 2019

I know a guy that works at a shop that mainly deals in diamonds. I went to go visit him at his store front last week or so and we got to talking watches. He buys and sells watches too at his shop (maybe 2-3% of his business) and he said on Rolex, he knows they will sell in days, and therefore margin is tight, but given the short turnaround he was okay with the low margin. Plus most that sell know value. On higher end watches (patek) he may sell those on commission as he does not want to tie up $25-50k for weeks or month. On models that are not popular (99.5% of watches), he knows they may take months to sell, so the offer is a tad higher that what the OP noted. So pretty much anything that is not a sport Rolex and a Speedmaster Pro takes a hit.

My PO 8900

Traded a speedy for it with a local watch club member here in SD, so can't really state the price. But seems going price is $3900-4100 USD.

michael22 · Jul 2, 2019

Does anyone know what markup the AD's usually use? For new pieces.

Muddlerminnow · Jul 3, 2019

In the world of vintage bamboo fly rods, if you sell to a dealer you'll get roughly 50% retail on a cash deal. This is because you are getting immediate cash. If however you consign the rod, you get 100% of the sales price, minus a consignment fee (usually around 20%), minus any discounts from haggling (I allow for 5%)--which means you'd get 75% retail, as opposed to 50%. The difference is that you have to wait for the sale to happen, which can take months,

STANDY · Jul 3, 2019

michael22
Does anyone know what markup the AD's usually use? For new pieces.

You don’t want to know 😉

SpeedyD · Jul 3, 2019

STANDY
You don’t want to know 😉

I did manage to get one AD to reveal their buy price. They even showed me the invoice.

BusyBuilder · Jul 15, 2019

I traded my 3+ year old Racing Speedmaster, I paid £2100 for it as I got a good discount at the time. Watchfinder gave me £1800 for it, I was quite happy with that. I bought my new Speedmaster Co axial, and got discount on that watch, could have bought it cheaper off ebay without warranty and authentication, but I was obviously happy with the deal as I got the watch.
My new one is as new, though it's few years old, it looks hardly worn, has everything with it and a guarantee, you get 14 days to change you mind too.
Saying all that, they have to make a profit, and in my view are no worse than BMW bike dealers. Would I use them again ? I would certainly give them the opportunity to see first. But I've no intention of giving up my Speedy, I love this watch.

Fusion · Jul 17, 2019

In other news

The sky is blue

A question of Value

cgaites

Akendo

tzachi

FlyingSnoopy

Owlsu

SpeedyD

padders

Taddyangle

michael22

Muddlerminnow

STANDY

SpeedyD

BusyBuilder

Fusion

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