The Watch Appreciation Thread (Reviews and Photos of Men's Timepieces by Rolex, Patek Philippe, Brei

[Mr. Moo]

I think a Speedy is a great suggestion, Moo. Haters gonna hate.

 

[Dino944]

I had an excellent chat with one of the leading secondary market sellers yesterday. One thing he mentioned is that the dealer margin for many high end watch brands has withered away to a mere 30%. This has dovetailed with the move to branded boutiques. Combine this with increasing crackdowns on state and local sales tax evasion, it's going to be very difficult to get any deal from an AD, unless they are stuck with stock and need cash ASAP. And at that point they'd rather do a bulk sale. That benefits the secondary market.

I have been hearing similar things for a the last 2-3 years. Cartier and Rolex went through a period when they ended their relationships with several hundred authorized dealers in the US, in favor of putting their watches with big chains that do not discount or opening boutiques. Other brands have opened boutiques or are opening "boutiques within" ADs. One AD I used to deal with years ago which carried brands such as Rolex, Cartier, GO, Patek, IWC, JLC, AP, Chopard, Tag, is basically down to Omega (which it brought in to try to make up for lost ground when Rolex terminated its relationship with them), GO, Tag, and an in house boutique for Patek. You used to be able to get great deals there but not anymore.

I often wonder if AD's are forced to sell at list price how long some will last. What is the point in buying a new watch from them, when some boutiques offer extended warranties, a free 1st service if you buy from them, and preferred access to difficult to obtain models or boutique editions (AP)? I think AD's will always survive in more remote areas where it doesn't make sense for a company to open a boutique, but they are going to squeeze many of them out of major cities and markets.

 

[rnguy001]

Hate to say it but I agree. One huge advantage of an AD are the relationships and discounts you can get. If pricing is the same across all boards, then AD's are at a huge disadvantage.

In the end, we may be seeing the end of 'great' discounts for most high end brands.

GET 'EM while you can!

I have been hearing similar things for a the last 2-3 years.  Cartier and Rolex went through a period when

I often wonder if AD's are forced to sell at list price how long some will last. What is the point in buying a new watch from them, when some boutiques offer extended warranties, a free 1st service if you buy from them, and preferred access to difficult to obtain models or boutique editions (AP)?  I think AD's will always survive in more remote areas where it doesn't make sense for a company to open a boutique, but they are going to squeeze many of them out of major cities and markets.  

 

[in stitches]

i tend to agree with dinos prediction, if things continue to move in this direction.

im honestly not sure how i feel about it. essentially, its the concept of a manufacturer going straight to the public. not too different than if ford or chevy or jaguar started opening up their own dealerships and selling direct to the public. or if general mills or quaker oats opened up little stores and pulled their foods and drinks from grocery stores. there are many examples, they are not all exactly the same, but the idea in basic form is pretty similar.

i always assumed that the notion was, that manufacturing and selling to authorized dealers to then sell to the public, was a simple business structure decision. selling to the public one person at a time, and servicing that sector is very different than manufacturing and selling "wholesale." for them to go into the retail business is no small change, and essentially requires building an entire secondary business within their business. more employees, more real estate, more and smaller single transaction values, service.... all the things that go into the retail industry, and that is not a simple task. and until now, they felt that is was not worth it to enter that mix.

for one reason or another, the manufacturers have decided to take on that hurdle. hell, you can even buy online direct from cartier, JLC and chopard, and im sure there are more.

now is this unfair to ADs? if you ask them, im sure they will say yes. but on the other hand, they have essentially been a middle man for manufacturers that did not want to go into the hassle of selling to retail customers, when they are producing such large quantities of product, and can sell in bulk to retailers. now they have decided to change that.

does it suck for ADs? sure. does it suck for people who want cheaper prices? sure. (side-note, to bring prices down, all people have to do is stop buying, and supply and demand will dictate price drops, but there will seemingly always be buyers at full retail, and so, the machine keeps churning.)

but as far as the brands are concerned, they are in the business of making money. especially nowadays when almost al brands are only subsidiaries of giant corporate luxury conglomerates. and they feel this investment in selling direct to the public is advantageous to them. its certainly well within their right to sell their product as they see fit, is it not?

do they owe it to the public to continue getting discounts, essentially making their MSRP a joke? do they owe it to keep supplying ADs and stay out of the way, so those business owners can make a living, or get rich, off of the brand product while the ADs continue to discount and effectively under value the brand? hard to say. im not sure what the right answer is.

its certainly interesting, and only the future will tell if the brands are making a brilliant move, or setting themselves back by years and will eventually implode. i for one, am watching closely.

 

[mimo]

I think what they're doing with outlets doesn't necessarily mean they are owning the outlets themselves. Certainly internationally, local agents remain the owners. But the point is control, by minimising the number of outlets, controlling stock and keeping a fierce eye on pricing. In the small market where I live, I think there's been a good demonstration of these trends over the last year or so:

- One leading dealer (PP, AP, AL, JLC and many more) has had to open two expensive new boutiques for Patek and Panerai, right next to their large new outlet. Or lose the agency. No negotiation. Last time I looked, the Patek boutique had four watches. Panerai opened with ten.

- Swatch group have now consolidated every one of their brands except Breguet (still with the guys above), with a regional agency covering several countries. That company has NO service centre in this country! The long-standing Omega agent of old, thankfully, does, and fixed mine in a day despite no longer being the official dealer. The new super-agent dicked me around for three months. I doubt they care; it's all about the brand prestige of designated, high-profile outlets. There is now a designated Omega boutique, two Swatch-only outlets, and several others divided in groups of brands - mainstream Swiss, and tacky pseudo-designer. The boutique that carries Blancpain and GO has three of the former and only one of the latter.

- Rolex have kept their agents (who also have Cartier, Chopard, Piaget, GP, IWC and a few others) and share a boutique and service centre with those other brands. But the boutique, that cost $2.6 million to set up (I had a meeting with the owner the other day), was effectively designed with Rolex in mind. They chose their space and designed it. Cartier and Chopard squabbled for second place, and each in turn specified their "section". Of course, every stick of furniture and decor was Swiss-made and specified. Actually the opening of the Panerai boutique above was delayed several times while they quibbled over finishing on the (compulsory) furniture and fittings). The service centre is the Rolex service centre, with everything down to tools and coffee coasters, Rolex branded. Whichever brand they're actually dealing with.

Another interesting thing re. discounts: a mutual friend of mine and the Rolex-and-others boutique owner's, told me he got a "20% discount on Rolex" through that friendship. Normal practice in this market is to over-price, because everyone expects a discount. They gave me 15% in the shop as soon as I walked in the door, but that's a BS discount that took it down to equivalent US RRP. So basically, even the billionaire owner of the Rolex dealer was only giving 5% to his billionaire friend. I figured from other things he said that there is just no room to mess with Rolex, on any level. When we met last week, he'd been in Switzerland recently. He was visiting Patek (as a customer), and chatting with the top people. He tells me the PP and Rolex sites are almost next to each other, with a L'Oreal factory in between. PP have bought the latter. But as they put it, they could only buy it "because Rolex allowed it"!

So what does all this add up to? Well, it means if you're a small family business, forget about landing (or keeping) any watch agencies. They want major investment and increasingly, their own designated boutiques, even in a small market.

And it also means never, ever **** with Rolex.

 

[in stitches]

solid post, mimo

And it also means never, ever **** with Rolex.

and as long as i have been involved in jewelry, that last line has been a steadfast truth.

 

[Hayward]

The Rolex boutiques are run by Tourneau, apparently. So they supply a turnkey retail presence, with the outward details dictated by Rolex. Meanwhile Tourneau benefits from lookyloos who go next door and walk out with a Hamilton or Mido. The process of purchase is part of the payoff for most consumers. Meanwhile aficionados should probably stick to the secondary market for collecting and flipping.

 

[Keith T]

Sad watch distributor talk makes Keith T sad.

I wore this one today:

 

[in stitches]

love that watch. i begrudgingly just sold the one we had on a metal bracelet, today.

 

[Mr. Moo]

you ever steal the watches, stitch? like, steal and keep them and say stuff like "i have no idea where that watch went"?

 

[in stitches]

I have not. Not to say that im not tempted. Im only human y'know.

 

[Mr. Moo]

Very well.

*jots something down*

 

[mimo]

He steals stationery. I bet he steals stationery. He totally looks the type.

 

[in stitches]

I use our shipping account. But I have permission for that.

 

[elisiX]

Quick pic from yesterday. PAM390.