MRSP went up : What about Grey pricing ?

[fsprow]

Speculation is futile when the answer will be apparent in a few months.

[ronricks]

The issue is the prices for many models are already so inflated is there much room for grey dealers to further increase by a significant amount?

[Nikrnic]

I doubt the greys will follow suit with a Rolex price increase as their prices are driven by the same as yesterday, supply and demand. Their prices can fluctuate daily.


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[Tavli3]

Originally Posted by SUPERDOC

If Greys were selling at discounts, then, yes.. you will see their prices rise..
Why would anyone think that the grey would rise prices on watches already 30-50% above MSRP?

we keep saying the market sets the price, so how does Rolex raising their below market price affect the market asking price? the Market seems to have spoken that the BLNR is not worth $18k.. Rolex increasing its MSRP to 10k won't make it sell any better at 18k... this is all such faulty logic to fear a Grey price increase..

"Rolex raised their prices, I sell for more than what they ask, so I have to raise prices because 'prices have gone up', even though they have not gone as high as what I am trying to sell for." is that a sound argument?

the best deal is still the AD - and although harder to get, there are people (seemingly the vast majority of people posting anyway - an admitted selection bias) who are buying at MSRP.

Add to the fact that with passing time, these models will become LESS scarce, not more... Rolex continues to make watches...none of these are limited.

Furthermore, the fly-by night flippers may be turned away by a price increase - after having to pay a higher full MSRP + tax, they may realize less of a profit margin selling at current market value, and decide to leave the watch at the AD -

The Grey market has always been there - they have been our friends, and now our enemies (for Rolex, we are still great pals when it comes to Omega, Breitling, ALS etc) ..

What I hope a Price increase does is turn away those looking for the quick profit/easy flip...

Well stated. Lets see what happens to the grey's inventory wise. If it holds steady or increases then it will put a squeeze on the flippers since greys will offer less or pull their bids rendering Rolex's price increase mute. If people start buying from greys again with reckless abandon then the price increase will be passed on and the song will remain the same.

[77T]

The MSRP hasn’t been the driving force in hot SS Professional models for years now. The demand is inelastic — so many people are clamoring for the hot models that demand remained stable even if prices did fluctuate. Just use the Daytona 500 as an example. As the grey prices rose (despite MSRP being flat) demand continued.

BUT - COGS did change during that period as some ADs were selling SS with a required PM bundle to greys. So that effectively raised their sunk cost in the SS models. The PMs got sold with much less GPM than the SS and that shortfall had to made up somewhere.

IMHO, the demand price model will fluctuate if demand rises or lessens. It might lessen for myriad reasons. But the greys’ price won’t appreciably change due to the 5-15% Rolex just added on. It will be the number of people willing to pay high prices to get hot models right now.



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[blown5.0]

As already mentioned, grey pricing is largely market driven. An increase in MSRP does not translate to a direct increase in pricing where the additional cost is passed onto the customer. With that said, I would anticipate an initial price increase to "test the waters".

[Robtayham]

Originally Posted by SUPERDOC

If Greys were selling at discounts, then, yes.. you will see their prices rise..
Why would anyone think that the grey would rise prices on watches already 30-50% above MSRP?

we keep saying the market sets the price, so how does Rolex raising their below market price affect the market asking price? the Market seems to have spoken that the BLNR is not worth $18k.. Rolex increasing its MSRP to 10k won't make it sell any better at 18k... this is all such faulty logic to fear a Grey price increase..

"Rolex raised their prices, I sell for more than what they ask, so I have to raise prices because 'prices have gone up', even though they have not gone as high as what I am trying to sell for." is that a sound argument?

the best deal is still the AD - and although harder to get, there are people (seemingly the vast majority of people posting anyway - an admitted selection bias) who are buying at MSRP.

Add to the fact that with passing time, these models will become LESS scarce, not more... Rolex continues to make watches...none of these are limited.

Furthermore, the fly-by night flippers may be turned away by a price increase - after having to pay a higher full MSRP + tax, they may realize less of a profit margin selling at current market value, and decide to leave the watch at the AD -

The Grey market has always been there - they have been our friends, and now our enemies (for Rolex, we are still great pals when it comes to Omega, Breitling, ALS etc) ..

What I hope a Price increase does is turn away those looking for the quick profit/easy flip...

Also, that assumes that the current grey / reseller price is the ‘market driven price’. It is not.

It is the price being set by sellers who have been buying up inventory. For example, that’s no different than a ticket scalper, who buys up all the tickets, and then has the ability to control the price. That is far removed from a ‘market driven price’.

[TswaneNguni]

Originally Posted by Robtayham

Also, that assumes that the current grey / reseller price is the ‘market driven price’. It is not.

It is the price being set by sellers who have been buying up inventory. For example, that’s no different than a ticket scalper, who buys up all the tickets, and then has the ability to control the price. That is far removed from a ‘market driven price’.

"Speculators price" ?

[watchmework]

to 2020

[Robtayham]

Originally Posted by TswaneNguni

"Speculators price" ?

It seems like it’s been more ‘wishful thinking’ price.

It will be interesting to see what the greys do.

[TswaneNguni]

Did a quick scan on chrono ...no real movement on pricing .
Agree ?

The only movement is my local currency that weakened a bit ..

[NachoNeal]

Yes. The particular watch I was looking at went from $11,375 to $11,875.

[Tavli3]

Originally Posted by TswaneNguni

Did a quick scan on chrono ...no real movement on pricing .

Agree ?



The only movement is my local currency that weakened a bit ..

Agree, I don’t see any price difference on C24. Which is very interesting since when you couple the increase from Rolex and the almost double increase in the C24 fee it’s a big dollar amount. My take is market very soft!


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[EEpro]

DavidSW raised prices across the board on PM and Daytona's vs last week.

[3sheets86]

Watchfinder are offering less money than they were 2 weeks before Christmas. They also haven’t updated the MRSP on their website yet. Their stock is still well overpriced.

[DTap]

Originally Posted by Mystro

I can tell you the margins are not high at all with our trusted sellers. I recently traded back a 1 year old TT CHNR. I got top dollar and when It was listed, I was shocked how tight the margins are. They are paying above msrp on a lot of popular models.

2-3 years ago the greys were selling below msrp and making money. I used to think they were the problem... but now I realize it’s just the market.

[TswaneNguni]

Originally Posted by 3sheets86

Watchfinder are offering less money than they were 2 weeks before Christmas. They also haven’t updated the MRSP on their website yet. Their stock is still well overpriced.

Watchfinder keeps the pricing the same but offers less money ? Simple ,thats like adding the increase,just not by increasing the selling price but decreasing money offered for stock .
Agree,may indicate enough stock .
Also,January be be slower after the exuberance of spending over the festive season .

[TswaneNguni]

Originally Posted by EEpro

DavidSW raised prices across the board on PM and Daytona's vs last week.

Means David gets it sold at higher pricing .
Most likely means he offers more for stock too .

[TswaneNguni]

I am sure it differs between sellers ,but what would the average percentage profit be on a transaction for the Trusted seller/Pre-owned dealer/Grey dealer ?

[THC]

Originally Posted by EEpro

DavidSW raised prices across the board on PM and Daytona's vs last week.

I personally knew all Day Date prices on DSW site the last 3 weeks, since I was buying one.. I looked yesterday and they all went up over 1k

Very happy I bought prior

[TswaneNguni]

Originally Posted by THC

I personally knew all Day Date prices on DSW site the last 3 weeks, since I was buying one.. I looked yesterday and they all went up over 1k

Very happy I bought prior

Same percentage increase compared to the increase in MRSP on DDs ?

[3sheets86]

Originally Posted by TswaneNguni

Watchfinder keeps the pricing the same but offers less money ? Simple ,thats like adding the increase,just not by increasing the selling price but decreasing money offered for stock .
Agree,may indicate enough stock .
Also,January be be slower after the exuberance of spending over the festive season .

I think think that too, probably willing to pay more for stock just before Christmas but less in the slow period. I suppose to sell an expensive watch in January is like trying to sell a convertible in winter.

[TswaneNguni]

Originally Posted by 3sheets86

I suppose to sell an expensive watch in January is like trying to sell a convertible in winter.