Insight from Geneva on SS shortage

[Bavariandoc]

I have been in search for Daytona or BLNR for the past few months, still with no luck. Speaking to some clients I did favors for, I got recommended to someone who works in Rolex corporate, not AD, and was told — if he cant get you one you want, it simply cannot get done.

I was on the phone with this gentlemen from Rolex for over half hour. Very nice guy and after telling him who gave me his #, he told me — between my client and his close friends, he got them around 15-20 Rolexes. Yup WOW. When I told him what I was looking for, he laughed for a second and told me very frankly - impossible right now. Conversation was very insightfull and he explained to me why and the current ‘mess’ with Rolexes SS hard to find ones...

Rolex is currently in process of protecting its brand as luxury watch brand. Issue is not production but release of those. There are plenty in safes in Geneva. He speaks to Geneva regularly hence he knows exactly what’s going on. Gray market is their #1 enemy. Rolex went from high end luxury watch brand, which you could only get at AD, to brand where you can currently get in walgreens, amazon, ebay, gray market, etc.
ADs are becoming just another shop where you buy Rolex, instead of being exclusive place where to get them as Rolex wants to be. They know SS watches Dayton/BLNR/hulk are most in demand and are releasing those at ‘bare minimum’, even though there’s high demand. Aim is to have ADs to sell only to those top loyal customers, which would not flip it, but its backfiring in the process as some ADs are not following strict guidelines and offload hard to find pieces to gray market. Rolex is furious about this as its making their products just another opportunity to which ppl are making profits and damaging the brand name. Some measures are being tested now - holding warranty card for 12 months by AD, mandatory sticker removal, they are exploring few others which are all aiming to disable ADs to offload hard to find pieces to gray market.

He could not help me with locating or ordering one, and he works in Rolex corporate. This tells me of how seroius the situation is. He offered with any other and he’ll be able to get me significant discount however I am not interested in any other.

Per him, this trend will continue for minimum of 1-2 years until Rolex figures things out on how to restores its name as luxury brand.

[Etschell]

you cannot stop flippers. does rolex realize some of the major top customers are gray dealers?

that said if this is true it is quite interesting. i sure wouldnt want to be paying large premiums when Rolex is pulling a De Beers (who is now selling synthetic diamonds for $200 bucks a pop).

i guess they are banking on many going to tudor. hence the release of a pepsi gmt.

at least when you buy a patek you know you arent getting diluted one day down the road. for certain ss rolex sports models you just may...

[watchmework]

I thought it wasn’t a Rolex corporate thing that the ADs were holding warranty cards, but something the ADs were choosing to do.

[ArtNouveau]

I call BS.

[jackcarls0n]

Non-transferable warranty would fix the problem of flipping to a great extent. But as Etschell says, you cannot stop flippers. They will exist no matter what.

[Bavariandoc]

I agree, cannot stop it.

Rolex knows ppl get on list with ADs and purchase hard to get watches for sole purpose of flipping

They are trying to minimize it but punishing actual customers in the process

[zen watch]

"There are plenty in safes in Geneva." I think it would be better if they just flood the AD's with supply to meet the demand. In that way, buyers would have no more reason to go the grey market. Wishful thinking. lol

[Jim Smyth]

Sounds to me that the Mother Ship cant control its AD's. Because we all know every Rolex goes through a AD. If I was selling a high end product I wouldnt worry about your product selling for more than MSRP. May be upset if it was the other way around. Economy is the US is booming right now. It wont alwats be that way. They better smell the Coffee before all there potential customers go some where else.

[D O C]

This is the dumbest thing I've ever heard. Do you have a bone to pick with gray dealers or something?

First you say gray dealers are #1 enemy. But mention amazon, eBay in the same breathe. I got news for you there will always be gray dealers. There's still pawn shops, watch dealers and watch shows where you can obtain a Rolex if desired.

Also the truth is that gray dealers are thriving right now. They are able sell new or like new watches at ABOVE msrp. Have you not noticed that? In fact, I seen a new SS for $12600 ABOVE msrp. If Rolex makes SS more available then grays will need to offer better discounts.

Then first you say Rolex is trying to "protect" its brand as a luxury brand, then later you say Rolex is trying to "restore" itself as a luxury brand. Well which is it? The truth is that its already a luxury brand.

I'll have to call BS as well.

[10klakes]

Plausible cause and effect(s). The result of limiting supply has only increased demand, which in turn, may condition Rolex to start playing games in this regard.

Has PP or AP done a better job of shutting out the greys or resellers? I don’t follow them close enough to know....


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[THC]

Would love to know what kind of favors you did for him to put you in an audience with a Rolex Corp exec.. are you a “fixer”?

[Boaters]

They need to monitor there AD"s sales and make warranties non-transferable. Easier said than done for sure. Just my thoughts.

[kultschar]

he offered you a significant discount on any other Rolex, works at Rolex and trying to protect the brand?

[Cold904L]

Originally Posted by D O C

This is the dumbest thing I've ever heard. Do you have a bone to pick with gray dealers or something?

First you say gray dealers are #1 enemy. But mention amazon, eBay in the same breathe. I got news for you there will always be gray dealers. There's still pawn shops, watch dealers and watch shows where you can obtain a Rolex if desired.

Also the truth is that gray dealers are thriving right now. They are able sell new or like new watches at ABOVE msrp. Have you not noticed that? In fact, I seen a new SS for $12600 ABOVE msrp. If Rolex makes SS more available then grays will need to offer better discounts.

Then first you say Rolex is trying to "protect" its brand as a luxury brand, then later you say Rolex is trying to "restore" itself as a luxury brand. Well which is it? The truth is that its already a luxury brand.

I'll have to call BS as well.

Easy tiger. He’s simply reporting what he was told.

Personally, I think it’s 100% accurate and reflective of precisely what most of us have experienced with (and heard from employees) at ADs and RSCs the last couple of years.

[Jeffwb65]

Wa!green's?!? I don't think so.....

[antoflo]

Rolex should directly own and control the distribution of their products. Other luxury brands are doing the same successfully (LV, Hermès..). Why not Rolex ?

[Fabrice M]

Nice fairy tale : )

[Flyfisher]

Somewhat plausible until you said " he’ll be able to get me significant discount."

Why would Rolex corporate, who is trying to crack down on discounts, offer one?

[Onikage]

Originally Posted by jackcarls0n

Non-transferable warranty would fix the problem of flipping to a great extent. But as Etschell says, you cannot stop flippers. They will exist no matter what.

Dude. Someone just overpaid through the @&$# for a new GMT. I don't think he cares about warranty or 'box and papers' retaining the value of his watch. All these instant profit flips on hot models will be the same. People want them. NOW!

[Sprta]

ADs know who their buyers are, they know the customers who buy the watches for their own use and they have a good idea of who the flippers are. Think about it, to get the hard to obtain watches the AD knows these customers and places them on the top of the list. That includes the flippers and grey dealers. They make a business decision as to who they will sell their watches to.
The ADs are going to run their business to make the most profit they can regardless what Rolex does to try and inhibit them.

[Roger Lococco]

It seems the easier approach would be to release the inventory and increase prices. That way Rolex would capture more of the profit, customers could buy from the preferred sales channel (i.e. ADs), and the grey market's importance would decline.

In parallel, perhaps shift some production away from watches like the YM2 and toward watches like the SS GMTs.

[coxswain]

Originally Posted by ArtNouveau

I call BS.

Originally Posted by D O C

This is the dumbest thing I've ever heard. Do you have a bone to pick with gray dealers or something?
I'll have to call BS as well.

Originally Posted by THC

Would love to know what kind of favors you did for him to put you in an audience with a Rolex Corp exec.. are you a “fixer”?

Originally Posted by makp

I know a guy who knows a guy...

Originally Posted by kultschar

he offered you a significant discount on any other Rolex, works at Rolex and trying to protect the brand?

Originally Posted by Jeffwb65

Wa!green's?!? I don't think so.....

Originally Posted by Fabrice M

Nice fairy tale : )

Originally Posted by Flyfisher

Somewhat plausible until you said " he’ll be able to get me significant discount."

Tough audience.

OP will never start any more thread here again.

[np2016]

Making the warranty not transferable to any name other than listed on the warranty card will dramatically reduce sales from Grey market dealers or will force Grey's to reduce their prices. The problem is if you buy a rolex the warranty follows the watch regardless if from an ad or Grey market dealer.

[jackcarls0n]

Originally Posted by Onikage

Dude. Someone just overpaid through the @&$# for a new GMT. I don't think he cares about warranty or 'box and papers' retaining the value of his watch. All these instant profit flips on hot models will be the same. People want them. NOW!

Yep, there are always that 'someone'. That someone add to the drop of the vast sea. Thus, the frenzy in the market.



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[RolexComplex]

OK, I just went to 3 Walgreens near me. Only one had a ss Sub. Lots of DJs and some PM. They were selling at MSRP, but they said I could use my Walgreens card points.

[bradyb]

Originally Posted by RolexComplex

OK, I just went to 3 Walgreens near me. Only one had a ss Sub. Lots of DJs and some PM. They were selling at MSRP, but they said I could use my Walgreens card points.

Maybe not Walgreens yet, but Walmart, yes:
https://www.walmart.com/search/?query=rolex&cat_id=0

[kingSubTT]

Originally Posted by Roger Lococco

It seems the easier approach would be to release the inventory and increase prices. That way Rolex would capture more of the profit, customers could buy from the preferred sales channel (i.e. ADs), and the grey market's importance would decline.

In parallel, perhaps shift some production away from watches like the YM2 and toward watches like the SS GMTs.

Nope. You release the inventory, no one will even buy it at MSRP, let alone increased prices. (Economics 101- supply/demand). Grey market will be killed, but so will Rolex. It’s not that simple.

[Roger Lococco]

Originally Posted by kingSubTT

Nope. You release the inventory, no one will even buy it at MSRP, let alone increased prices. (Economics 101- supply/demand). Grey market will be killed, but so will Rolex. It’s not that simple.

Econ 101 typically starts with a supply and demand curve. Right now, demand for the stainless steel sports models is far higher than supply. The 'rent' is being captured by the grey market and flippers. You can increase supply on a number of these models without 'killing' Rolex and without driving prices below the current (and somewhat artificial) MSRPs.

[RolexComplex]

Originally Posted by bradyb

Maybe not Walgreens yet, but Walmart, yes:
https://www.walmart.com/search/?query=rolex&cat_id=0

These are pre-owned. Walgreens has BNIB. Right next to the Drakkar Noir.

[jackcarls0n]

Talking about supply and demand. This is the line outside the G-Shock store in Taipei for the GMWB5000 watches. 4 pieces are being sold today based on lottery system. One guy alone has 20 people to bid for him. In total 50 people here and more to join. In total 4 of us here really are watch fanatics and love the design.

This is a que for a watch that can earn someone $300-500 in profit. Imagine if you can earn $2000-10,000 in profit. The line would be even longer.

Just sharing an example!

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