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Old 7 December 2019, 12:54 AM   #61
fsprow
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I know several AD's and also resellers. All say their business is good to excellent and the presence of buying customers in their stores (not selling just Rolex) supports this. Sales of PM Rolex in the AD's I know are the strongest in years, with higher profit margins than SS.

In my view, we just need to accept the apparent fact that demand is very strong and for probably good long term business reasons Rolex cannot or chooses not to greatly increase production.

As with many products in demand (Hondas in the 1980's, most Ferraris always, the 2020 Corvette) market price is not MSRP. I suggest we just need to live with that fact and decide where we want to put our money.
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Old 7 December 2019, 12:59 AM   #62
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I know several AD's and also resellers. All say their business is good to excellent and the presence of buying customers in their stores (not selling just Rolex) supports this. Sales of PM Rolex in the AD's I know are the strongest in years, with higher profit margins than SS.
Same profit margins. Higher revenue. Margin is the same on PM and SS.

That aside, I share your outlook. Every dealer I know as well are making money hand over fist. Demand is beyond anything they've seen but supply seems about the same.
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Old 7 December 2019, 01:44 AM   #63
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904L has a different 'look'.

Tudor are not 904L afaik.

The Breguet thing is quite interesting.

Asking because thats Swatch and I believe that's like Burger King selling meat to McDs.
Perhaps they packaged into a deal with the ETA movements, until Tudor brings full production in-house. I've have heard several watchmakers say they believed the same. It's interesting that's for sure. I never would've expected Tudor and Breitling to do a movement swap either, so I guess they all rather see health of the industry and overall profitability.
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Old 7 December 2019, 01:55 AM   #64
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People should read up on what Veblen Goods are..
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Old 7 December 2019, 02:12 AM   #65
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The problem is that the grey market has exponential characteristics. That is to say that the moment the first dealer realizes he can make a nice profit by re-selling a hot rolex, the demand increases massively as dealers go long and build up stock. Then for a while prices and waiting lists increase as Rolex production increases more slowly than demand.

But eventually equilibrium and unwinding will happen - Likely Rolex will gradually increase prices and supply until premium on a hot Rolex is a few k. Then everyone is happy. The danger for ADs who are now long Rolex is that the unwinding is violent, e.g. triggered by a 30% stock price reduction.
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Old 7 December 2019, 02:31 AM   #66
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Nope. See when I got my Rolex, it was between me and the AD. Now there are hundreds maybe thousands of gray market dealers. There are no hard to find watches. You and I can have any reference on our wrist by Monday. We just need to go to the gray dealers. That’s not a shortage, that’s a supply chain issue. I’m not sure why this is hard for folks to understand. Reason alone will tell you that if one can get exactly what we want, how can that be a shortage? There is a shortage of for example of a Rolex 4113, steel PP 1518. Right we can’t get these in 2 days. That’s a shortage my friends.
Agreed.

I think a lot of people In these threads are defining ‘shortage’ to reflect their inability to buy the watch from an AD at MSRP.

That’s different than a Rolex manufacturing supply shortage.
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Old 7 December 2019, 02:45 AM   #67
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Yes,Rolex manufactures the ss shortage watches.Demand higher than production ,therefore difficult to obtain .

Really,a child of four will understand this .
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Old 7 December 2019, 02:54 AM   #68
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There are any number of all models out there for sale. ADs are not the benchmark. The official price is irrelevant as the watches dont exist in ADs. The market value is the price.
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Old 7 December 2019, 03:12 AM   #69
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Agreed.

I think a lot of people In these threads are defining ‘shortage’ to reflect their inability to buy the watch from an AD at MSRP.

That’s different than a Rolex manufacturing supply shortage.
Bingo!
There is no shortage.
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Old 7 December 2019, 03:51 AM   #70
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Yes. It was conspiracy between Rolex and Lizard People.
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Old 7 December 2019, 06:32 AM   #71
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Does anyone know the number of AD's year by year? If the world has more AD's in new markets such as middle east, Asia, Africa, and if production capacity is the same, then you get shortage of inventory. My opinion is that more AD's will be closed.
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Old 7 December 2019, 06:38 AM   #72
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Agreed.

I think a lot of people In these threads are defining ‘shortage’ to reflect their inability to buy the watch from an AD at MSRP.

That’s different than a Rolex manufacturing supply shortage.
Agree.
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Old 7 December 2019, 06:41 AM   #73
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Not in my opinion.

Rolex has continued to make the same number of watches as they always have and so supply has been similar.

Demand for high-end mechanical watches has spiked world-wide, using up the immediately available supply.
Based on the COSC that wasn't released since 2016...?

To all the other people who says they manufacture same amount of watches. Based on what data again? COSC got the mouthguard. Export data doesn't show what model/type. It's pure guess unless you got access to supply data to a given AD. I'd say most in here don't have that (perhaps the ones reading [lurking] this thread do)
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Old 7 December 2019, 07:36 AM   #74
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I'm now convinced. There is no shortage. Thanks for that.

And now we have a new nemesis to blame -- the evil AD's!!!! Let's start a thread about that. Oh wait...

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Old 7 December 2019, 08:10 AM   #75
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Not in my opinion.

Rolex has continued to make the same number of watches as they always have and so supply has been similar.

Demand for high-end mechanical watches has spiked world-wide, using up the immediately available supply.
+1.
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Old 7 December 2019, 11:43 AM   #76
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I believe the bracelets on all Tudors are made by Breguet. I'm not sure the cases, but you can see a small color difference between the metals of the cases and bracelets on some reference examples. Supposedly different tooling is needed for the steel Rolex is using vs Tudor.
Breguet?! Hahaha, no.

This might be a very confused misremembering of the deal between Breitling and Tudor where each uses a movement from the other for a model.
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Old 7 December 2019, 12:26 PM   #77
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Conspiracy: Rolex resources diverted to Tudor as such slowness in producing Rolex SS watches

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Old 7 December 2019, 04:18 PM   #78
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It is 100% Rolex made in Switzerland.

Because Rolex knows that spending is down, they wanted to appeal to human nature to drive irrationality. Much like Nike has done with their SNKRS limited launches. Kids line up for these and resellers fly all over the world to secure stock... it's also the same model that Hermes has used for many years. LV also tried to catch on, but they didn't need to because their pricing meant pretty much anyone with a job could afford something.

Rolex lost me forever, and I was a big fan for two decades. It is funny that people try to make themselves believe Rolex did not intend to lead the market to its current state.

Only Rolex has survived the last 3-4 years and they have used this strategy very well. Luckily it only works on people where FOMO is most effective... unfortunately, FOMO works very well
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Old 8 December 2019, 01:11 AM   #79
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Breguet?! Hahaha, no.

This might be a very confused misremembering of the deal between Breitling and Tudor where each uses a movement from the other for a model.
The movement swap was just recently with Breitling. This was when Tudor came back to the US supposedly. Your guess now is as good as mine nowadays but take a look at some of the still recent Tudor and you’ll see sometimes mismatching cases and bracelets that still today seem to be from multiple sources.
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Old 8 December 2019, 03:05 AM   #80
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The issue doesn't seem to be around the number of watches being produced but the distribution of production between the various models. Lots of diamond dial datejusts are available but limited availability of SS Sports models.
Other brands don't seem to have the same issues, it's not difficult to get most Omegas, Cartiers, JLCs etc
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Old 8 December 2019, 03:09 AM   #81
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Originally Posted by mfm22 View Post
Supply is constant , Demand rising simple economics. As simple as it gets actually
Rolex is not , maybe can not , chase the demand . Why should they ?
To make more watches and more profit one year may in turn produce a lull in sales the following year

This /\

We are experiencing an unprecedented period of economic growth and stability that would have been impossible to forecast. This has likely resulted in more disposable income to buy luxury items.

For a company to "tool up" significantly in order to increase supply, they would need to be very confident that demand will continue to be high, and this would fly in the face of the inevitable economic down turn.
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Old 8 December 2019, 06:13 AM   #82
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Does anyone know the number of AD's year by year? If the world has more AD's in new markets such as middle east, Asia, Africa, and if production capacity is the same, then you get shortage of inventory. My opinion is that more AD's will be closed.
Stopped in an AD yesterday and the SA noted this. Explained how more ADs have opened to accommodate the increased demand, especially in places like China. He further explained that the pie (supply) now has more slices, thereby reducing what they're allocated because Rolex has continued to produce the same level of supply.
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