Conspiracy theory debunked? Rolex UK 2017 Sales Figures.

[lenfried29]

I'm selfishly wish Rolex drop they production, increase prices and demand increase a lot more. That way we all who own the Rolex watches benefit from this.

[mattza]

Originally Posted by lenfried29

I'm selfishly wish Rolex drop they production, increase prices and demand increase a lot more. That way we all who own the Rolex watches benefit from this.

I hope Rolex doesn't increase production and Rolexes become dime a dozen now since these sales figures show everyone is buying them (probably because of the surging economy, real estate and stock market)

That means values will likely not be increasing anytime soon (I also secretely wished they were limiting production lol)

[idontlike_bandwagons]

True watch enthusiasts speaking... not!

[1911dude]

If any of this is real, I'm double shorting the market tomorrow--this would be the clearest top signal since strippers owned 6 houses. There's no way in the world demand has increased that much when every person I see has a smart watch of some sort on.

Facts prove that material possession are not what millennial's want, retirees are not buying $8,000+ watches and that leaves the people in their peak earning years.

There's no way a mortgaged, double car payment, still paying off student loans, upper middle class family with 2.5 kids and college 10 years away decides that because their 401K is back at 2007 levels they are throwing caution to the wind and now he's going to get that sub he always dreamed of, NEVER

[Uggi]

Originally Posted by 1911dude

If any of this is real, I'm double shorting the market tomorrow--this would be the clearest top signal since strippers owned 6 houses. There's no way in the world demand has increased that much when every person I see has a smart watch of some sort on.

Facts prove that material possession are not what millennial's want, retirees are not buying $8,000+ watches and that leaves the people in their peak earning years.

There's no way a mortgaged, double car payment, still paying off student loans, upper middle class family with 2.5 kids and college 10 years away decides that because their 401K is back at 2007 levels they are throwing caution to the wind and now he's going to get that sub he always dreamed of, NEVER

Please don't short the market based on analysis of this nature.

[tyler1980]

Originally Posted by 1911dude

If any of this is real, I'm double shorting the market tomorrow--this would be the clearest top signal since strippers owned 6 houses. There's no way in the world demand has increased that much when every person I see has a smart watch of some sort on.

Facts prove that material possession are not what millennial's want, retirees are not buying $8,000+ watches and that leaves the people in their peak earning years.

There's no way a mortgaged, double car payment, still paying off student loans, upper middle class family with 2.5 kids and college 10 years away decides that because their 401K is back at 2007 levels they are throwing caution to the wind and now he's going to get that sub he always dreamed of, NEVER

i tend to agree but i also think "scarcity" or the appearance of scarcity makes it a different kind of purchase. Its become exclusive and they absolutely want that.

10K watches anyone can walk in and buy, and its about having a 10k watch to show off and its about the money. Having a hard to get 10k watch and its less about the money and more about how you even got one. That is important and its quite a bit different and it really makes the money factor secondary as far as the signal you are projecting to your peers. Quite frankly i tend to prefer that as well as anything to change the subject from money is fine by me.

[hambone1983]

In economics a luxury good does not behave at all like a normal good or an inferior good. You have to understand the role of exclusivity, status and perceived rarity. When people say things like Rolex would be smart to sell as many pieces as they possibly can they fail to grasp the difference between a luxury good like a Rolex watch and a bloody can of cat food. It has to do with a principle called income elasticity of demand if you care to look it up.

Fleetlord is always dead on point in his posts on this matter. Dead on. If you disagree with him, you're wrong.

[JewelRaul]

US Double digit increases year over year 2016, 2017 rules out decreased production

[Devildog]

Originally Posted by 1911dude

If any of this is real, I'm double shorting the market tomorrow--this would be the clearest top signal since strippers owned 6 houses. There's no way in the world demand has increased that much when every person I see has a smart watch of some sort on.

Facts prove that material possession are not what millennial's want, retirees are not buying $8,000+ watches and that leaves the people in their peak earning years.

There's no way a mortgaged, double car payment, still paying off student loans, upper middle class family with 2.5 kids and college 10 years away decides that because their 401K is back at 2007 levels they are throwing caution to the wind and now he's going to get that sub he always dreamed of, NEVER

The numbers are real. Rolex sold more watches in the market in question in 2017 than it did in 2016. The statistics provided elsewhere support this being a global phenomenon.

We can of course debate the reasons for that ad naseum but that doesn’t change the base facts.

[Andad]

Originally Posted by hambone1983

In economics a luxury good does not behave at all like a normal good or an inferior good. You have to understand the role of exclusivity, status and perceived rarity. When people say things like Rolex would be smart to sell as many pieces as they possibly can they fail to grasp the difference between a luxury good like a Rolex watch and a bloody can of cat food. It has to do with a principle called income elasticity of demand if you care to look it up.

Fleetlord is always dead on point in his posts on this matter. Dead on. If you disagree with him, you're wrong.

I disagree with your Fleetlord evaluation and your post.
You are claiming that Rolex watches are luxury goods.
That was your first mistake.

Fleetlord has his very fixed opinion and some may agree with him.

I don’t.

[rambo99]

demand from china is dropping fast as they are now in big financial trouble. I predict the market price of hot ss sport models will start dropping very soon.

[aleeboy]

Originally Posted by rambo99

demand from china is dropping fast as they are now in big financial trouble. I predict the market price of hot ss sport models will start dropping very soon.

I doubt you can attribute decreased demand to China here. The correct focus is the cartel control of supple and distribution. It's all held up in Hong Kong. The powers that be will just sit on supply to keep prices high since people aren't giving up on obtaining "desirable"sports models. It's as simple as this. And this should be no surprise as Hong Kong is the number one importer of Swiss watches. Also, it's a cartel business and their cronies will fly all over the world to secure supply and lock it down. It very much resembles real estate in some cities. However, unlike real estate, you can sit on watches and let others cry. Holders may shed a tear or two at worst.

[rambo99]

Originally Posted by aleeboy

I doubt you can attribute decreased demand to China here. The correct focus is the cartel control of supple and distribution. It's all held up in Hong Kong. The powers that be will just sit on supply to keep prices high since people aren't giving up on obtaining "desirable"sports models. It's as simple as this. And this should be no surprise as Hong Kong is the number one importer of Swiss watches. Also, it's a cartel business and their cronies will fly all over the world to secure supply and lock it down. It very much resembles real estate in some cities. However, unlike real estate, you can sit on watches and let others cry. Holders may shed a tear or two at worst.

those cartels in hk you are talking about will need cash during economic downturn. they would be left with no option but to fire sale their stock holding.

[WatchLurv]

Originally Posted by rambo99

those cartels in hk you are talking about will need cash during economic downturn. they would be left with no option but to fire sale their stock holding.

You're talking about the ones who have just entered the market. I think he was referring to the independent shops selling watches...They've been around for 10+ years. They've built up so much profit, even during economic downturn, they will stay put and let you cry.

[supernova]

The published figures only indicate £ amount and not count.

This to me sounds like since there is a shortage of SS models, people are pushed for towards DJs and PM watches therefore increases the average selling price.

I've had 2 friends looking for SS sports in past 6 months but they couldn't be acquired so both purchased TT Subs for ~30-40% more than their SS counterpart they originally wanted.

There is definitely a shortage of SS watches from Rolex at ADs, which is also definitely controlled by Rolex and it seems to be working,

1. Building more hype around the brand, hype is a big thing these days
2. Also increasing their revenue from higher average selling price

Just good market manipulation by Rolex really.

[tyler1980]

Originally Posted by supernova

The published figures only indicate £ amount and not count.

This to me sounds like since there is a shortage of SS models, people are pushed for towards DJs and PM watches therefore increases the average selling price.

I've had 2 friends looking for SS sports in past 6 months but they couldn't be acquired so both purchased TT Subs for ~30-40% more than their SS counterpart they originally wanted.

There is definitely a shortage of SS watches from Rolex at ADs, which is also definitely controlled by Rolex and it seems to be working,

1. Building more hype around the brand, hype is a big thing these days
2. Also increasing their revenue from higher average selling price

Just good market manipulation by Rolex really.

you are assuming the cause of the shortage on the supply side, not the demand side. No one is debating that its hard to get a watch. i think the numbers show they are not cutting production as what is the common accusation. Demand is the ultimate reason here.

I agree its making other models more attractive to purchase though.

[Devildog]

Originally Posted by supernova

The published figures only indicate £ amount and not count.

This to me sounds like since there is a shortage of SS models, people are pushed for towards DJs and PM watches therefore increases the average selling price.

I've had 2 friends looking for SS sports in past 6 months but they couldn't be acquired so both purchased TT Subs for ~30-40% more than their SS counterpart they originally wanted.

There is definitely a shortage of SS watches from Rolex at ADs, which is also definitely controlled by Rolex and it seems to be working,

1. Building more hype around the brand, hype is a big thing these days
2. Also increasing their revenue from higher average selling price

Just good market manipulation by Rolex really.

I've thought a fair bit about this.

Accounting for the 10% price increase in November 2016, Rolex UK's gross revenue from watch sales to AD's is significantly up. That can only be down to a combination of three things:

1) More units are being sold
2) Margins per unit sold are up
3) ADs are paying Rolex more per unit

We know that the margin has only increased by 4%. That is not significant enough to state that Rolex UK is increasing its revenue by selling more PM watches, or more TT - both of which have higher margins for Rolex (PM particularly) That 4% could quite easily be explained by the 10% price increase, if costs are well controlled.

All the info suggests that AD margins per unit are unchanged. Which just reinforces the point above that Rolex UK's margin increase of 4% is most likely down to the 10% price increase in November 16.

The logical conclusion to all of this being that discussed in my opening post.

There may be less SS Sports watches available in your location, but in no way does that confirm that Rolex are manufacturing any fewer, or artificially restricting supply. It could just as easily (and far more likely) mean that demand is up and that watches which would previously have found their way to ADs local to you and I have been shipped to different markets, as below:

Originally Posted by exador

That's because they're going East...

[TheVTCGuy]

Originally Posted by padi56

Have to agree most all of these conspiracy theories past threads IMHO were complete and utter boswellocks.

Have to agree with PADI, utter Boswellocks.








Pssssst. What does Boswellocks mean?

[Uggi]

Originally Posted by hambone1983

Fleetlord is always dead on point in his posts on this matter. Dead on. If you disagree with him, you're wrong.

Originally Posted by tyler1980

I think the numbers show they are not cutting production as what is the common accusation. Demand is the ultimate reason here.

I agree it is demand related. I disagree with Fleetlord (though I like reading his posts).

[hambone1983]

Originally Posted by directioneng

I disagree with your Fleetlord evaluation and your post.
You are claiming that Rolex watches are luxury goods.
That was your first mistake.

Fleetlord has his very fixed opinion and some may agree with him.

I don’t.

a luxury good is 1) not a necessity, and 2) one whose demand increases with income. A Rolex watch meets the definition of a luxury good, it isn't a matter of opinion about the brand or anything else.

[peterpl]

At the end of the day Rolex prices will drop. Just wait and see.

This is a huge bubble. Its not maintainable long term at all. It doesnt matter Rolex made 87% profit jump since 2015 etc etc.....or whatever.

The selling prices of simple, common and not very special SS references are just playing into flippers hands to make a motsa whilst they can. If I was a gray dealer I'd be making as much as possible in todays climate as well. At the end of the day the guys paying the premium are the suckers.

Imagine you were one that paid for a SS BLRO at $21-22k last year. Look at the prices now and imagine trying to sell one second hand your down quite considerable amount of money at todays market. Prob even more money than flipping a PM piece.

[Andad]

A luxury good is:

1) Not a necessity.........I think a watch is a necessity.....at least for me.

2) One whose demand increases with income.....Hmmm.... a luxury good is a normal good or even an inferior good at different income levels but we also have to consider the market forces when we use the word Rolex.

So....I really need to have a watch and MY choice is based on value for money spent and future value based on evaluating information.

This goes for all watch brands not only Rolex.

I have a Seiko quartz watch purchased many years ago because I liked it.

How was I to know that James Bond also bought one?

[tyler1980]

Originally Posted by hambone1983

a luxury good is 1) not a necessity, and 2) one whose demand increases with income. A Rolex watch meets the definition of a luxury good, it isn't a matter of opinion about the brand or anything else.

back in the day a mechanical watch was more of a necessity and that has changed and Rolex themselves have moved more upmarket further into the luxury space vs some of the tool watch past. You can use it as a tool watch sure, but its luxury and jewelry and its positioned that way. I agree.

Selling the idea that you too can be a deep water explorer or a pilot is more a selling point for people chained to a desk than it is a practical use. That is another way to sell luxury. To some extent buying a high performance sports car gives the buyers a feeling they are a race car driver even though they still have the same speed limit on the highway as everyone else.

[AK797]

Originally Posted by hambone1983

a luxury good is 1) not a necessity, and 2) one whose demand increases with income. A Rolex watch meets the definition of a luxury good, it isn't a matter of opinion about the brand or anything else.

Rolex popular models are operating as Veblen goods now. As prices rise, demand rises too.

They are certainly luxury goods when a basic watch that can perform all the same functions can be bought for a few bucks.

[Andad]

Originally Posted by tyler1980

back in the day a mechanical watch was more of a necessity and that has changed and Rolex themselves have moved more upmarket further into the luxury space vs some of the tool watch past. You can use it as a tool watch sure, but its luxury and jewelry and its positioned that way. I agree.

Selling the idea that you too can be a deep water explorer or a pilot is more a selling point for people chained to a desk than it is a practical use. That is another way to sell luxury. To some extent buying a high performance sports car gives the buyers a feeling they are a race car driver even though they still have the same speed limit on the highway as everyone else.

What??

[tyler1980]

Originally Posted by directioneng

What??

if you want to keep your license you do

[alonzo]

Thanks!