I work as a sales manager in the auto industry and I would be pretty upset if people walked in all day long to test drive and see our vehicles only to buy them for substantially less online. I recently bought a brand new omega ploprof that has a msrp of $9400 for $5439.64 shipped to my door from chrono 24 including tax and shipping. I even went to the local omega boutique and their watchmaker sized the rubber band for my wrist for free which was a pretty lenthy process. So how do the sales associates who Im assuming work for commissions at these stores still manage to make a living if everyone is buying gray market for so much less?

 

Possibly due to getting the inventory at practically cost and selling at a markup. I don’t know what a GM seller’s basis is, but probably more.

 

So you would be pretty upset if someone did you out of a sale by buying online, yet you were happy to do exactly that yourself.
Am I missing something here?

 

I doubt they are hurting AD/OBs as much as people would like to think given such substantial price differences at times. For instance, a customer may not be able to afford a watch at MSRP, but 30%+ below now is an option. So Omega therefore gains a customer it otherwise would not have been able to. That customer now can be sold accessories via AD/OBs as well as servicing work for the life of the watch if the owner chooses to use them for that as well.

 

I think grays help the business as they move the less attractive pieces with a discount.

Omega and the AD are still making money maybe not as much as if they sold it themselves but profit is profit.

 

They do get some additional business by selling bracelets, straps, and accessories. They also make money doing service and repair work.

The local Toyota dealership doesn’t care where you bought yours. I’m sure they’d like to sell you another one but would settle for doing service and repair work on it.

 

Because you cant buy a car online for a lot less than what I sell it for. I wouldn't blame a customer if my bottom line out the door price was $55,500 but he can get it for $45k elsewhere because I would do that myself.

 

Does Omega Boutique buy the actual boutique real estate or are they just renting the lot ? I know probably in Malls they are rented but in commercial areas do they sometimes end up owning the building ?

 

Read the first sentence of your first post again.

 

Very few stand alone buildings are owned by the occupant. Most are NNN (triple net) leases. Walgreens, Dick's Sporting Goods, Jared, etc, run like that.

For example:
https://www.calkain.com/property/jared-the-galleria-of-jewelry-mobile-al/
https://www.netleaseadvisor.com/tenant/walgreens/
https://www.loopnet.com/Listing/801-Sunland-Park-Dr-El-Paso-TX/12837830/

 

Cause it is an OB. It would have been a different story of it was an AD. They would have kicked you out on the spot.

 

Actually Mayors jewelers did size a Breitling for me that I bought from another AD that had a much better price and Mayors couldnt match it. Again didnt charge a penny. We get old customers who arent explained all the features of their new car properly and they come to us and we still spend the time to help them because its just good business sense. They didnt buy this car from us but they might buy the next one. There is no Cars24 yet lol.

 

Grey market dealers buy a bunch of unpopular models that ADs must buy as per their contracts from the watchbrands. They help ADs moving the necessary volume and making space for new, more popular models. In return for buying large volume from the AD, they get high discounts and here and there access to the more popular models.

They don‘t hurt the ADs. It’s a win-win. Or why would the ADs sell to the grey market in the first place?

 

And the watch brands are not hurt either, because every watch is sold to the AD before reaching the grey market, for the same wholesale price it would’ve been sold anyway.

The fuss the brands kick up now and then about the grey market is only for PR reasons. And of course to promote their Boutiques - because that’s where the additional profit is, in cutting out the middle man (the AD).

 

First you need to ask where the grey market gets the watches....

AD’s... they sell to greys to boost volume or to ditch unsold stock forced on them...

 

If I did not buy from resellers, I would simply buy used after someone else paid the 'new watch' premium. It's much like buying a brand new car -- most watches drop in value quite a bit as you wear it out the boutique's door.

 

Grey dealers get more watches out to the public with those better prices. . . Maybe Omega looks at it as "advertising"

 

The way I see it is that grey/gray market dealers get their watches from the ADs, the ADs move them on for a small profit to maintain turnover - their reasoning presumably along the lines of getting 10% of something rather than 30% of bugger all.
The OBs have the cheapest cost price combined with the most expensive selling price, so pocket a decent margin. They obviously attract enough of the type of customer that will pay full RRP to cover the ‘tyre/tire kickers’ that just try watches on to see what they want. The customer service provided by the OBS is sound business practice, promoting the quality of the brand.

 

Omega grey dealers buy their watches from omega AD's. Don't see how it hurts them at all. They are just selling a second hand watch, which is unworn often with stickers, never with OEM warranty. It should be discounted heavily!