Margin for a grey dealer on specific SS pieces

[Podmornica]

I have noticed that the prices for BLRO and BLNR are dropping in Hong Kong lately, especially for the cash payments. BLNR can now be had for 12K EUR all day long, while the BLRO is now sub 15K EUR, and we had the official price increase yesterday. So, something is definitely going on on the market, it's just that we, the regular buyers will probably find out last about it. Still, that could be the indication that the 2020 will not be an 2018/2019!

[Littletommy]

I gotta believe that DavidSW gets a jolt out of reading these posts about his business modus operandi!

[bezler]

Originally Posted by sallyhats

but why is the black sub so hard to get but the Yacht-Master sits in windows.

It's kind of like when people go to the market and pick out the best vegetables.

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[Littletommy]

Originally Posted by sallyhats

It’s an ugly business that the Rolex brand has gotten itself into and at some point they’ll need to rectify the situation as its reputation will be tarnished. Us WIS know how these pieces are being moved, but when the general public finds out that Rolex doesn’t really care about their customer base just their bottom line. Someone will feel wronged who has some sort of clout and want to boycott them.

[bezler]

Originally Posted by huncho

yes of course. they always have

Not a chance.

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[huncho]

Originally Posted by bezler

Not a chance.

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not sure what you mean here. how do you think they made money on steel models back when they were cheaper at a grey dealer than ADs? lol

obviously depends on the model though

[sallyhats]

Originally Posted by huncho

not sure what you mean here. how do you think they made money on steel models back when they were cheaper at a grey dealer than ADs? lol

obviously depends on the model though

Back then, ADs were giving discounts to walk-ins and those walk-in sold to greys which then flipped for below msrp. Back then and now are two different era’s. The business model changed.

[huncho]

Originally Posted by sallyhats

Back then, ADs were giving discounts to walk-ins and those walk-in sold to greys which then flipped for below msrp. Back then and now are two different era’s. The business model changed.

the model has changed but subs are pretty easy to get. i was just referring to subs

[sallyhats]

Originally Posted by huncho

the model has changed but subs are pretty easy to get. i was just referring to subs

Easy to get in my book means sitting in a case. There is still a wait list for a black sub, even if it is only a couple of weeks.

[Roddypeepa]

In what world are subs of any kind easy to get for the average Joe these days? Not round these parts...




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[H25B]

Waited around 4 mos in the Midwest US for a Sub Date. I don’t call that “easy to get..”

Easy to get is walk-in and it’s in the case.

[roh123]

Grey dealers basically make a few dollars per watch running marathons to get stock and to unload crap. It is a hard business where they kill themselves to make a profit selling one Daytona and ten two-tone ladies Datejusts. The AD has an easy life selling all at retail while the grey dealer finds small brick and mortar shops that are happy to buy whatever Rolex slightly under retail. The grey makes a loss on the crap to stores and other dealers and hopes to make a big enough profit on the hot stuff to eager buyers that can’t get allocation.

I guarantee that the big price raise from Rolex hurt a lot. Suddenly the small profit the grey dealer made on that Daytona is gone when they absorb the loss on all the Datejusts.

I think a lot of grey dealers will shift focus from Rolex to easier stuff. Availability will get better at ADs when the big margin goes to Rolex instead of to the grey market.

[exador]

DavidSW is advertising unworn 116610s for $11,275. That’s 25% over new MSRP. So margins still very healthy

[Calatrava r]

Yes for walk-ins it has been sparse. More about relationship building now. Most of the watches are obtainable with patience and honest communication.

[Khans14]

Originally Posted by exador

DavidSW is advertising unworn 116610s for $11,275. That’s 25% over new MSRP. So margins still very healthy

Wouldn’t his profit margin depend on what he paid? In other words, did he pay msrp for it from the guy/girl who got it from the AD?

[roh123]

Originally Posted by Khans14

Wouldn’t his profit margin depend on what he paid? In other words, did he pay msrp for it from the guy/girl who got it from the AD?

Grey dealers basically get all their inventory from ADs and other dealers directly. The occassional flippers are just bonus for them. Their pricing is based on the market. Meaning they charge as much as possible depending on how desperate they are to sell. Unlike you and me they make money on turnover so max price is not necessarily always the best option. It all comes down to how liquid they are and what opportunities there are around.

[TeutonicCarFan]

I would imagine AD and grey help each other. Everyone thinks ad can just unload at will and profit. Sure in the TRF world where everyone want a sub and BLRO and Daytona... Because AD can move those all day long. But think of all the DJ, YM, and PM (1 month ago my AD had YG daytona on oysterflex been there forever , YG Smurf for awhile,etc). They have all that inventory sitting that they paid for, sure they sold the few SS but that doesn't keep them open.

I would guess Mr grey and AD have an arrangement like this... Grey gets a few SS at MSRP (which clearly the case as all the for sale ads here with warranty card from previous month). In order to get those SS get the less desirable stuff at discount. AD make money on SS and a little on other stuff. Grey make money doubling price of Daytona and then can sell other stuff 15 percent less than MSRP and make a few bucks.

AD gets sales numbers and grey can keep paying for bandwidth.

[Khans14]

Originally Posted by roh123

Grey dealers basically get all their inventory from ADs and other dealers directly. The occassional flippers are just bonus for them. Their pricing is based on the market. Meaning they charge as much as possible depending on how desperate they are to sell. Unlike you and me they make money on turnover so max price is not necessarily always the best option. It all comes down to how liquid they are and what opportunities there are around.

Would a gray dealer ever pay a flipper above MSRP? For example, it seems like if you bought a BLRO and offered it to reputable gray he/she would probably offer more than msrp since the gray will turn around and sell it for double. I guess what I am asking is what kind go margins do grays make when they buy from an individual? I get the gray gets paid to be the middle main and handle the sale, but it seems unreasonable that any individual would ever sell a sticker BLRO to a gray for msrp knowing the gray will sell it for almost twice that. The gray needs to make a profit but that seems a bit much.

Anyone know roughy the margins grays look to make on buying from an everyday person? (I should add... I have not been and will not be a flipper. I am simply curious.)

[roh123]

Originally Posted by Khans14

Would a gray dealer ever pay a flipper above MSRP? For example, it seems like if you bought a BLRO and offered it to reputable gray he/she would probably offer more than msrp since the gray will turn around and sell it for double. I guess what I am asking is what kind go margins do grays make when they buy from an individual? I get the gray gets paid to be the middle main and handle the sale, but it seems unreasonable that any individual would ever sell a sticker BLRO to a gray for msrp knowing the gray will sell it for almost twice that. The gray needs to make a profit but that seems a bit much.

Anyone know roughy the margins grays look to make on buying from an everyday person? (I should add... I have not been and will not be a flipper. I am simply curious.)

As mentioned earlier it comes down to risk and how easily the grey dealer can sell it for more. It is absolutely possible to get more than MSRP for certain things but the dealers will of course try to pay as little as possible.

Some dealers are happy to make little and some need more. Just as any other business.

Most of the grey market are people selling dealer to dealer for literally no margin. It is not DavidSW calling every dealer in the world to get a Daytona to mark up 50%.

[Ryann24]

Originally Posted by sallyhats

Why would an AD sell under MSRP to a grey when they can sell to the public at MSRP.

I'm assuming because they will bundle several pieces together, and the others are ones that's dont move well in stores.

[sallyhats]

Originally Posted by Ryann24

I'm assuming because they will bundle several pieces together, and the others are ones that's dont move well in stores.

I think the AD has all the power, there are a ton of grey dealers out there and the AD gets to decide who they sell too. If one grey dealer says I won’t pay msrp on a DJ but I’ll take 10 but another says I’ll take 7 at msrp you better believe I’m selling 7 at msrp. I’ll move the other 3 sooner or later.

[Mystro]

Originally Posted by Khans14

Would a gray dealer ever pay a flipper above MSRP? For example, it seems like if you bought a BLRO and offered it to reputable gray he/she would probably offer more than msrp since the gray will turn around and sell it for double. I guess what I am asking is what kind go margins do grays make when they buy from an individual? I get the gray gets paid to be the middle main and handle the sale, but it seems unreasonable that any individual would ever sell a sticker BLRO to a gray for msrp knowing the gray will sell it for almost twice that. The gray needs to make a profit but that seems a bit much.

Anyone know roughy the margins grays look to make on buying from an everyday person? (I should add... I have not been and will not be a flipper. I am simply curious.)

Yes, As mentioned earlier, I sold a 1 yr old CHNR to a dealer and got top money (aka above msrp). They then listed it and the margins were razor thin from what they paid to what they were asking. There was absolutely no room for the next owner to haggle on the price.

[Khans14]

Originally Posted by Mystro

Yes, As mentioned earlier, I sold a 1 yr old CHNR to a dealer and got top money (aka above msrp). They then listed it and the margins were razor thin from what they paid to what they were asking. There was absolutely no room for the next owner to haggle on the price.

Interesting. I saw your earlier post but wasn’t certain what top money meant. Thanks for clarifying.

[Chewbacca]

Originally Posted by mattedialdoc

Chewie,
You are a gentleman and a scholar!!


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Hey! Watch the insults!

Originally Posted by ilovethiscity

You know what I totally agree I’m sorry it must be time of the month.. I’m sorry everyone back in my box I go I didn’t mean to sound like an ass and I’m sure I did, sorry again



I know it was an awful response, apologies all!

Just don't act like Korey with a 'K'. He's the real ass on this thread.

[Andad]

Originally Posted by huncho

i would assume greys get subs for a good amount under retail...

Originally Posted by sallyhats

You think ADs are selling to greys below MSRP?

Originally Posted by huncho

yes of course. they always have

Why would an AD sell any sought after sports watch to a grey for a good amount under retail?

At retail with a bundle of slow sellers perhaps?

[Halifax Daytona UK]

The grey dealer I attended school with and have been friends with for 30 years plus told me the only way they pay MSRP for the hot pieces , via their AD contacts is by buying other ‘slow sellers’ at MSRP or just below MSRP.

I’m currently wanting a piece ( a slow seller) for my others half’s significant birthday, currently £10,500 on the Rolex site , via my grey I can get it for £8500.

[daOnlyBG]

Originally Posted by exador

DavidSW is advertising unworn 116610s for $11,275. That’s 25% over new MSRP. So margins still very healthy

This.

I laughed into my tea when I read that Sub Dates are only a few bucks over MSRP. Please let me know where.

[daOnlyBG]

Originally Posted by huncho

yes of course. they always have

Not as of the last few years.

Originally Posted by huncho

i would assume greys get subs for a good amount under retail...

Not even remotely accurate.

Originally Posted by huncho

yeah i get that but i was just referring specifically to a regular sub, outside of what they're buying to get the popular models

The regular Submariner Date still carries a substantial premium worth one's time. The only ones that sell below $10K (and yet above MSRP!) are either a few years old (and the warranty's length is thus shorter) or without box and papers.

Originally Posted by Mystro

No they don’t. In many cases the grey dealers are paying above msrp. It’s a wash on what the grey dealer has to absorb to get the more popular models. In other words, the grey dealers have to also take less popular stock from the AD to get the hot models. I have traded a newer/hot model in to a trusted seller and I got top dollar and when he listed it, it showed his margins are razor thin.

This.

Originally Posted by sallyhats

It’s an ugly business that the Rolex brand has gotten itself into and at some point they’ll need to rectify the situation as its reputation will be tarnished. Us WIS know how these pieces are being moved, but when the general public finds out that Rolex doesn’t really care about their customer base just their bottom line. Someone will feel wronged who has some sort of clout and want to boycott them.

With due respect, you literally have it backwards.

Because Rolex uses the allocation business model, your stainless steel sports watch will always maintain some relatively high level of value. Sure, you might not make as much as you would have hoped if you go to "cash it in" to a dealer- but you'll retain far, far more than just about any other watch brand, save maybe for certain Patek Philippes. Stop and appreciate what this means for a moment: if you bought a Seamaster brand new, and then after a few years wanted to evolve your collection, you've just about lost 40-50% when you go back to sell to a dealer. With a Hulk Submariner, you could have even paid grey market and only taken a 15% hit. If you bought at MSRP, you'd not only break even, but probably make a little bit, too.

I was literally where you were once on this very forum.

I argued that Rolex is pissing off its base by embracing the allocation model. But really, it isn't: at the end of the day, when anyone here gets the call from their AD that their Daytona or GMT is in, they'll literally forget every petulant comment they've hurled toward Rolex SA and rush over to the AD with money in their hands, a smile on their face bigger than just about any time in their life. We can lie to ourselves and pretend because we love the Daytona, and maybe we do, but in reality it's because the minute you purchase that Daytona the net worth of your collection has gone up $10-$12K.

Now, you want to complain about the ADs being super shady, dishonest, vague, etc., be my guest- I'm guessing everyone here has had their grievances with particular ones. But Rolex is doing just fine by its customers.

[APPRF]

Originally Posted by daOnlyBG

Not as of the last few years.



Not even remotely accurate.



The regular Submariner Date still carries a substantial premium worth one's time. The only ones that sell below $10K (and yet above MSRP!) are either a few years old (and the warranty's length is thus shorter) or without box and papers.



This.



With due respect, you literally have it backwards.

Because Rolex uses the allocation business model, your stainless steel sports watch will always maintain some relatively high level of value. Sure, you might not make as much as you would have hoped if you go to "cash it in" to a dealer- but you'll retain far, far more than just about any other watch brand, save maybe for certain Patek Philippes. Stop and appreciate what this means for a moment: if you bought a Seamaster brand new, and then after a few years wanted to evolve your collection, you've just about lost 40-50% when you go back to sell to a dealer. With a Hulk Submariner, you could have even paid grey market and only taken a 15% hit. If you bought at MSRP, you'd not only break even, but probably make a little bit, too.

I was literally where you were once on this very forum.

I argued that Rolex is pissing off its base by embracing the allocation model. But really, it isn't: at the end of the day, when anyone here gets the call from their AD that their Daytona or GMT is in, they'll literally forget every petulant comment they've hurled toward Rolex SA and rush over to the AD with money in their hands, a smile on their face bigger than just about any time in their life. We can lie to ourselves and pretend because we love the Daytona, and maybe we do, but in reality it's because the minute you purchase that Daytona the net worth of your collection has gone up $10-$12K.

Now, you want to complain about the ADs being super shady, dishonest, vague, etc., be my guest- I'm guessing everyone here has had their grievances with particular ones. But Rolex is doing just fine by its customers.

This

[APPRF]

The black sub is easier to get now, even in UK. Still a waiting list piece, but some people can get it now without purchase history or not a significant one. They just need patience.