How do resellers get new watches

[fsprow]

I have a friend in Central Asia who is an authorized dealer for several high end brands and over dinner I asked him, on a confidential basis, where the watches they receive go.

I stress this is just one dealer and the results may be quite different for others, but here it is:

Sold to long term customers who collect watches and infrequently sell them. 30%.

Sold to resellers, usually in a package with less collectible watches.
20%

Sold to “friends” of the company, who purchase (often as gifts) large volumes of goods of various kinds (jewelry etc). They are often then sold to resellers, frequently in the US and Europe.
40%

Sold to new customers who appear to be solid future buyers.
10%

Sold to tourists or other non-locals
0%

[IamJacky]

I've bought quite a few pieces via grey dealers in Southeast Asia, and I have struck up some conversations among quite a few owners of these grey dealers - large and small - on how they get their goods.

Obviously it is to be taken with a grain of salt as no resellers will reveal all of their business know-hows, but from what I've gathered, most of the resellers said the majority of their stocks come from:

1. Runners - these are anonymous friends/networks of people who they employed/partnered up to shop at various ADs/Boutiques (both domestically and internationally) that pose as regular customers but with enough spend history to generate their VIP status.

2. Flippers

3. Bundling from ADs by buying a whole batch of less-desired models in order to get one popular model.

4. Regular customers who wish to sell/trade their pieces.

[whattimeyougot]

I think the moral of your story is that every AD knowingly sells some percentage of their inventory to resellers. I don’t blame them. I would too. It’s a business at the end of the day.


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[teck21]

Originally Posted by whattimeyougot

I think the moral of your story is that every AD knowingly sells some percentage of their inventory to resellers. I don’t blame them. I would too. It’s a business at the end of the day.


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How did you arrive at ‘every AD’ from that one story?


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[whattimeyougot]

Originally Posted by teck21

How did you arrive at ‘every AD’ from that one story?


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I think it was my initial reaction to yet another post related to inventory and ADs.


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[Harry-57]

Sounds about right. It's how businesses stay in business. I would imagine that not much Rolex inventory needs to be sold sideways in the present market.

The only part that doesn't stack up is the confidential part. Since your friend is doing nothing illegal and has disclosed no commercially sensitive information, there is no need for confidentially. Once people start inserting that into a sentence they can say anything they like.

[Cavester]

"I asked him, on a confidential basis"....

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[Tools]

I would say that your "Central Asia" friend is not typical of the Dealers in the US, or of a solid business model.

Most Dealers who take in trades or buy outright, clean-up or service those used watches, then put them out for sale either at that shop or another within their company structure. The point is to make a profit, and any trade-in is simply part of the transaction.

Not all Dealers will take a trade-in if they don't have the infrastructure to recover costs of doing this.

[VegasBaby]

Originally Posted by fsprow

I have a friend in Central Asia who is an authorized dealer for several high end brands and over dinner I asked him, on a confidential basis, where the watches they receive go.

I stress this is just one dealer and the results may be quite different for others, but here it is:

Sold to long term customers who collect watches and infrequently sell them. 30%.

Sold to resellers, usually in a package with less collectible watches.
20%

Sold to “friends” of the company, who purchase (often as gifts) large volumes of goods of various kinds (jewelry etc). They are often then sold to resellers, frequently in the US and Europe.
40%

Sold to new customers who appear to be solid future buyers.
10%

Sold to tourists or other non-locals
0%

You asked "your friend" on a ""confidential basis" and then you go blabbing on a forum? You're some friend, obviously, very trustworthy. Oh yeah....and thanks for the update!!!

[GB-man]

They exchange tacos for them. Everyone loves tacos. Dirty secret of the watch business.

[fsprow]

Originally Posted by VegasBaby

You asked "your friend" on a ""confidential basis" and then you go blabbing on a forum? You're some friend, obviously, very trustworthy. Oh yeah....and thanks for the update!!!

I could have been clearer. I told him what I would pass along. I also imagine a dealer would not want to be identified by name to manufacturers who may not condone (at least publicly) their approach.

[TunaTuna]

Originally Posted by fsprow

I have a friend in Central Asia who is an authorized dealer for several high end brands and over dinner I asked him, on a confidential basis, where the watches they receive go.

I stress this is just one dealer and the results may be quite different for others, but here it is:

Sold to long term customers who collect watches and infrequently sell them. 30%.

Sold to resellers, usually in a package with less collectible watches.
20%

Sold to “friends” of the company, who purchase (often as gifts) large volumes of goods of various kinds (jewelry etc). They are often then sold to resellers, frequently in the US and Europe.
40%

Sold to new customers who appear to be solid future buyers.
10%

Sold to tourists or other non-locals
0%

60% of the time, it works every time

[TunaTuna]

Originally Posted by VegasBaby

You asked "your friend" on a ""confidential basis" and then you go blabbing on a forum? You're some friend, obviously, very trustworthy. Oh yeah....and thanks for the update!!!

Holy shyte that's so true!

[vh2k]

Originally Posted by Tools

I would say that your "Central Asia" friend is not typical of the Dealers in the US, or of a solid business model.

Agreed. Not typical at all. Selling directly to a grey is the rare exception (which Rolex, PP, RM, and AP are working tirelessly to prevent)… not the rule.

[Net-man]

Grey channel is fed by either AD or end customers. What other source there could be?
Does it matter, more important is any brand trying to fix it.


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