Out of the watch hobby for 4 years- what did I miss?

vintage hab

Rather “monthly post”

gbesq

Gatekeeping is a charitable way of describing Rolex’s business model. I agree that JWRosenthal’s characterization of it as disgusting is more appropriate. That being said, I’ll admit that Rolex has done a masterful job of convincing consumers that a mass produced mid-tier luxury watch is a must have item that’s worth waiting and/or overpaying for.

Davidt

What’s disgusting about Rolex’s business model?

They make watches, almost certainly as many as they ever have (bar Covid issues) and sell to their ADs.

Granted there may be some ADs who operate in a disgusting manner (the one I’ve bought a couple from the in the UK however have been great) but this is separate to Rolex.

I’m no brand apologiser but I can’t help but feel there is an element of people putting 2 and 2 together and getting 12

gbesq

Do you believe that Rolex is somehow unaware of all of the backdoor selling to grey marketers that goes on at its ADs, the resulting empty display cases, waitlists, requiring customers to buy watches that they don't want as a prerequisite to getting the watch that they do want, etc.? If Rolex is aware of these practices and condones them, then yes, I think that's disgusting and I don't believe that I'm alone in that assessment.

Davidt

Do you have evidence that ADs sell out the back door to Greys? In the absence of evidence I feel it’s more likely that ADs in general sell to their preferred clients. Yes some of these are greys/flippers and as I said, I’m sure some ADs are scum bags and do knowingly sell to greys but I think the truth is more nuanced.

For instance, the ADs near me will not register interest via phone and require proof that you live locally before they’ll sell you a watch. The AD I’ve bought from has said they dislike flippers, and when I went to register interest in a new watch they asked if I still had my Sub. When I showed it she smiled and said, I’ll make a note of that. There are also stories of of ADs banning customers who were found to be flipping new watches.

The empty cases and waitlists is simply supply and demand.

Regarding buying watches you don’t want, again I can only talk to the ADs near me, but two who I spoke to but didn’t end up buying from never suggested I needed to buy anything else. The AD whom I purchased two from also never suggested I needed to buy anything I didn’t want. It never even came up.

Davidt

I’d bet most of the watches that show up at Greys come from individual (professional) flippers, rather than from the ADs direct. A number of Greys have even said this is the case.

Archer

Well, to use your own standard, you have no evidence of this. Do you think the grey dealers are going to publicly admit that they are getting their watches directly from AD's, and jeopardize that flow? Not bloody likely...

Archer

Well, to use your own standard, you have no evidence of this. Do you think the grey dealers are going to publicly admit that they are getting their watches directly from AD's, and jeopardize that flow? Not bloody likely...

gbesq

And I can actually walk into any Omega AD and buy or at least order any Omega model that Jomashop has listed and NOT pay a premium. You can’t get a no date Rolex Sub which retails for $8,950 at your Rolex AD, but Jomashop has them in stock and will gladly sell you one for $16,500. And I very much doubt that Jomashop acquired them from individual flippers since individuals seem to have a very hard time buying that model from ADs who seem to never have them in stock.

Davidt

So to be clear (and I’m playing Devils Advocate to a degree as I still don’t believe a huge number of ADs sell direct to greys. I think there are professional middlemen/flippers that build relationships with ADs and they are the source of many watches, combined with a large number of ‘lucky’ individuals who get ‘the call’ for a watch they’re on the waitlist for and can’t resist the instant profit for doing nothing and so flip), you’re ok with ADs selling to greys if it benefits the consumer but expect them not to do it in the few instances it benefits them?

I just don’t buy this “most Rolex ADs are shipping most of their sports models out the back door to Greys with a wink and a nod” and even if they were, it’s the ADs who would be scum bags, not Rolex.

gbesq

No, what I mind is that Rolex apparently won’t produce enough watches to meet consumer demand. That results in ADs selling inventory to grey marketers at a substantial markup because they can’t resist the profit in doing so and then, in turn, the grey dealers resell that inventory to consumers at nearly twice the MSRP. Who gets screwed? Not Rolex. Not the ADs. Rolex’s customers, that’s who. If that’s going to be the case, why doesn’t Rolex just shut down its dealer network, double its prices and just sell exclusively online?

Davidt

No you’re right I don’t have evidence of this aside from the fact several Greys have said on YouTube and other places that they don’t get many watches direct from ADs, but you’re right, this isn’t reliable info due to the potential conflict of interests.

My point around Rolex’s part is this stands IMO.

Archer

I guess I would consider Rolex complicit in this, even if they are not the ones selling the watches to the grey dealers. Rolex has been very brutal in how they punish AD's in the past for breaking the rules. For example, a large prestige chain in Canada lost AD status several years ago for advertising a discount on Rolex products (this was back before the brand was the FOMO brand it is today, when a discount was common) in the newspaper.

Yet they stand by and watch this shit show go on and issue letters saying that distribution of products is up to AD's, not them, so just washing their hands of it all. Rolex is the most controlling watch brand on the planet when it comes to dealing with it's business partners, yet on this issue they do what...nothing...because it helps them make more money.

A watchmaker who spends $100k getting their shop set-up, services the brand reliably for years, will suddenly get their account pulled for no reason. AD's will get dropped after investing even more in their stores, because the brand thinks it's the right thing to do. This company pulls the rug from under their business partners on a regular basis, yet absolves themselves of all responsibility for the AD shenanigans going on now.

Now maybe people love the brand and watches so much that they have no issue with this, and if they don't that's fine. But for me, that way of doing business is not the standard to which I run my business, so it's not anything that I could condone. You can call it disgusting, unethical, or a host of other things, and IMO it would not be wrong...

Cheers, Al