I have always struggled to understand the whole luxury watch market.  I have a number of friends who are forever explaining to me how they have bought a Rolex at a discount and that they can actually resell the Rolex that they own for more money than they just paid a dealer for it.  In other words, and this is all based on the allegation that they know some amazing dealer somewhere and as a result of that can get more for the watch when they resell it than what the dealer has just sold it to them for!

To me it does not make sense, because it is obvious that the dealer had to make a profit in selling it to them and they can’t be selling it “below cost”.  I came across an article recently on Barron’s that confirmed my suspicions but took them even further.  They explained that websites like www.watchwarehouse.com sell men’s watches at huge discounts - sometimes up to 40% off the listed price and while I am mentioning Rolex, some of the models that I saw have been advertised at 26% off, etc.  The problem is that basically nobody will now believe the retail price because everybody knows you can get the watches at a discount elsewhere and whatever that minimum price is that you can find on those websites becomes the maximum value for the watch.  It is not realistic to assume, unless you are dealing only with fools, that you can sell the watch second hand to somebody else for more than they can buy it for new!  

My watch is an IWC Portuguese Chronograph and it too is listed on the website, although the price has gone up since I bought it a number of years ago.  The exact model that I have was not for sale on the website, but most of the prices were much cheaper than the retail price, so for example the black version of the watch that I have normally retails at $6000 is available on this website for $5,168 – much less than listed in the shops.  It is still more than what I paid for the white face version of the same watch, but it does show that people who like to talk about trading their Rolex’s, etc, are to a certain extent living in a dream world or relying on finding somebody more silly than they were, in terms of believing that they really were buying something for less than at cost.  Apparently, they source most of these watches from the very same dealers who sell them in the shops for the higher prices – by calling up authorised dealers and getting them for example to agree to a 40% discount before on-selling it on the websites or by the various companies at a 30% discount and pocketing the 10% difference.  

Apparently there is an excess inventory at the moment, around the world of luxury watches and so everyone has been forced to turn a blind eye to this practice of trying to get rid of excess stock by heavy discounting.  In short, if you have the money, now is the time to get that expensive watch you have been looking for noting that the websites do have much cheaper watches like Fossil.  They also have Mont Blanc pens from 20% to 25% lower than we see them retailed for in the shops.  Another famous website that deals with reselling watches is Chrono24.  One watch you will struggle to find on most of these websites, and it will be a disappointment to those who own them, are Tag Heuer – and that is because those types of watches are typically shunned by collectors and not actually sought after.  You will hundreds of those listed on Ebay.  While marketed as an up-market watch it is seen by collectors as being more mainstream and not exclusive.