Grey Market Pricing

[majidessa]

The reason for the high margin at grey dealers is to compensate for low sales volume, their sales have dropped and they can not retain their business/ life style with 10 - 15% margin as they used to and so their margins are now 25 - 30%.

The question would be how long they can last will depend on their liquidity and market forces, but my guess would be that by end of the year prices will drop further as Rolex is increasing production and the hype keeps cooling off

[huncho]

Originally Posted by majidessa

The reason for the high margin at grey dealers is to compensate for low sales volume, their sales have dropped and they can not retain their business/ life style with 10 - 15% margin as they used to and so their margins are now 25 - 30%.

The question would be how long they can last will depend on their liquidity and market forces, but my guess would be that by end of the year prices will drop further as Rolex is increasing production and the hype keeps cooling off

10-15%? they were flipping watches for $500-1000 during the peak of the market. they never even got close to 10%

[fooey]

The grey dealers are rammed full with stock cause hardly anyone is buying, but they stubbornly still won't lower their prices! It's a shit show!

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[Watchman001]

Originally Posted by huncho

10-15%? they were flipping watches for $500-1000 during the peak of the market. they never even got close to 10%

Where is your proof for this statement that you make with such certainty? Go check bid/ask spreads in the real world.

[majidessa]

Originally Posted by huncho

10-15%? they were flipping watches for $500-1000 during the peak of the market. they never even got close to 10%

Covid period was an exception and even then their margins were high, the $500 - $1000 was mainly dealer to dealer margin on standard SS models.

Pre covid, the market had momentum as Rolex availability issues started in 2016 - 2017, margins were around 10 to 15% depending on model.

[77T]

Whatever one believes is their own business.

Price is set by the marketplace - a Rolex is only worth the amount that an able and willing buyer pays.

If nobody had the finances, either credit or cash, (purely hypothetically) the authorized retail channel would cut their normal profit margin until they reach the level that an able and willing buyer would pay.

We have seen those days in the past and I regret the financial crisis that might bring us to that point again. But cycles do repeat...


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[huncho]

Originally Posted by Watchman001

Where is your proof for this statement that you make with such certainty? Go check bid/ask spreads in the real world.

500-1000 for watches bought and sold in wholesale groups which was a huge amount of them during that time and is the reason prices got so inflated. in 2021 they were flipping between dealers or buying from retail and flipping to a dealer for a quick 500-1000 profit. even today those guys are flipping back and forth for small %s

if we're talking about retail to greys to retail then you would always get lowballed by selling to greys who sold to end users on their own websites/platforms and those margins were always pretty high. even during the peak when a pepsi would go for 22k you'd only be offered like 18 for it. nothing new there

[Watchman001]

Originally Posted by huncho

500-1000 for watches bought and sold in wholesale groups which was a huge amount of them during that time and is the reason prices got so inflated. in 2021 they were flipping between dealers or buying from retail and flipping to a dealer for a quick 500-1000 profit

if we're talking about retail to greys to retail then you would always get lowballed by selling to greys who sold to end users on their own websites/platforms and those margins were always pretty high

His statement was clearly the latter. Grey and sales volume. And his numbers are right, not $500-$1000.

[Mathematoxic]

I wouldn’t put in $16k for a $500 profit in a falling market.

[vinny84]

Normally I would say just go through the AD and not go grey but every time I go into an AD now and just get the bs run around, I'm slowly starting to be a grey only guy.

Are the prices inflated? Yes. Can you get any watch you want at any given time? Yes. Not sure about everyone else but I'm starting to get exhausted with ADs.

[worldofoyster]

it's going back up soon

[sbrit88jr]

Originally Posted by worldofoyster

it's going back up soon

I agree, I bought grey last week. It’s worth the extra 1500 bucks to me cause I’m years out on SS which is all I wear. I don’t see why paying grey premium matters, yes the market goes up and down, so don’t sell low. I’ll leave my name on the list and either eventually get a watch at msrp and keep it flip it and get back some of the premium I’ve paid.


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[Scottyboy]

Originally Posted by padi56

Speaking for myself would never pay inflated grey prices for any watch.

Padi, when was the last time you visited a Rolex AD, and what was the last Rolex you bought new?

[ppierce]

If something is listed high is it insulting to offer msrp plus sales tax (that I would pay) plus a few hundred extra?


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[Bartolo]

Originally Posted by justdate

Grey market normally means (and on this site used to mean) genuine, brand new stock being sold to retail customers via non authorised channels.

A common one was for independent dealers to bulk buy brand new Rolex watches from authorised dealers, and then resell them at a discount - often overseas. E.g. a U.K. independent dealer would bulk buy 20 Rolex watches from an authorised dealer in Italy, bring them to the U.K., and then sell them to U.K. customers. So you as the retail customer were getting a brand new genuine item, but it was coming from a non authorised vendor of Rolex.

For some reason in the past years on this site, ‘grey market’ has just come to mean the entire secondary market. And a grey dealer is any secondary dealer - regardless of if their inventory is brand new from official channels, or they are buying used watches from retail customers.

1. I think this follows the trends everywhere. It's not just this tie.

2. "Brand new" and "unworn" have become corrupted terms unfortuately. And essentially unverifiable by us retail customers of the secondary market. Stickers can be applied. Items can be polished. The mere existence of the term "slider" in an of itself tells us that things may not be what they seem.

[Wahlberg]

Simple question:

I see multiple Rolex Explorers 16570s white dials for sale at around 7850 usd. If there are 100 of these sitting and not selling after weeks/months, why aren't the prices pushed down until people do start buying them?

[ppierce]

Originally Posted by Wahlberg

Simple question:

I see multiple Rolex Explorers 16570s white dials for sale at around 7850 usd. If there are 100 of these sitting and not selling after weeks/months, why aren't the prices pushed down until people do start buying them?

Denial same thing tends to happen in the housing market. Sellers holding on to the past.

[gamingdoctor]

It's a luxury good, there is little intrinsic value in what we're buying. If your heart wants it and you feel like it's a fair price, pay it.

Just because Rolex says a watch is worth "X" amount does not mean that's what is worth to you.

[testrak]

Originally Posted by fooey

The grey dealers are rammed full with stock cause hardly anyone is buying, but they stubbornly still won't lower their prices! It's a shit show!

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Rammed full of Daytonas

[Zach69SS]

I would never buy from a grey dealer it does not matter how bad I want it.
Things will change eventually, in the meantime I will go without or buy something else.

[Vince_76]

Originally Posted by Zach69SS

I would never buy from a grey dealer it does not matter how bad I want it.
Things will change eventually, in the meantime I will go without or buy something else.

I don’t like buying grey either. But curious why you’re so adamant in not doing so?

[Joearch]

Back to the good old days? 2014 sourced my new BLNR from DSW for less than retail and no tax. Was able to build a decent collection with him and a few AD pieces. No funny business. While things have slowed a bit, still more customers than watches at the AD’s around here.

[daysky1]

Originally Posted by dgjks6

Noob here so don’t roast me -
So just so I understand - when you guys talk about the gray market, is it for new watches not from an AD, used watches of the latest gen (for example 126613…) or all used subs?

Most of the watches that I picked up from the gray Market have been within the past 3 to 6 months on the warranty card. And a few even closer than that to the date that I purchased it so if it's a somebody walks out of the authorized dealer with the watch they just purchased call the gray Market and sell it within a week or two or even a month i still consider that close to being brand new and in a lot of cases people will walk out of the authorized dealer perhaps wearing the watch out of the authorized dealer but that's not much different than trying one on in the store and then they will turn around and sell it because that's why they bought it to make money off of it so at that point I guess you have to pick and choose ask the gray what's the warranty card what date is on it is it considered unworn does it still have stickers I bought a lot of them through the gray Market that have been fully stickered that's less likely nowadays though but I did in the past it was really fun to take those stickers off when I got this watch. Bottom line either the AD sold the watch to a legit customer who resold or the AD would sell the watch out the back door, fully stickered with the warrenty card dated or in some rare cases with open card, ie not made out to anyone nor having the warranty active. After 5 years it doesn't matter anyway.

[daysky1]

Originally Posted by testrak

Rammed full of Daytonas

What country is this in?

[Harry-57]

I have bought models from other brands from greys at significantly below MSRP. I am grateful to people who refuse to go this route because it assists me in getting the best prices. My AD is intelligent when it comes to this, they offer competitive discounts on models that sell new at under MSRP.

[Marcjvr]

Originally Posted by Sublovin

Paying even $1 over retail is wildly foolish in my opinion. I won’t participate in the games of inflated prices and faux collectibility

Some people think being on waitlists for years and spending time dropping in to keep the relationship alive is foolish

[Sublovin]

Originally Posted by Marcjvr

Some people think being on waitlists for years and spending time dropping in to keep the relationship alive is foolish

Right… I agree with those people as well. I don’t participate in that practice either, but thanks.

[Hgl8tx]

Japan

[rolexnerd]

A $1500 premium on a Sub is actually not bad compared to what you'll need to spend at an AD with the “hope” of getting allocated. Imagine building a purchase history and your SA leaves and you get pushed further down the line. You also need to take into account that every year that goes by, the cost of a Sub from the AD will increase in price. The grey premium is nothing. Buy today, enjoy and you’ll never even think of the small
premium you paid. If you get allocated another by the AD, sell the one you purchased at grey and you’ll still be infront.

[BroncoOne]

Originally Posted by 2000-NJDEVILS

Maybe this helps -
I just purchased a BNIB DSSD 136660 for MSRP and no sales tax (had it shipped out of state).
On the other hand, paying over list is still rampant with buying Porsche 911’s. If you don’t pay the 3-7% over MSRP to the dealer - you will be waiting to Spec out your new ride for a very, very long time…And if you go out of state, you will still need the local dealer for maintenance and they are not so gracious to those who haven’t given them any business. That said, I had to pay 3.5% over list to get an allocation to Spec and get an estimated delivery of June 10……

Same with a Range Rover, but that was over 12 months ago. Now no premium required.

Will it happen with high demand watches? You will only know if a dealer takes what less than the list price that you offer. Every seller will be in a different situation. Ignore the list price as a real indicator of sale price.