Another AD is Dropped (Ohio)

[Underachiever]

Just learned today that Rolex has dropped Cleveland’s west side AD and the Rolex website confirms it.

Makes some sense as they had not built out the store-within-a-store it appears Rolex demands now of its ADs and when I was in the store at the beginning of the month they had 7 watches you could buy (nothing on my list but some nice pieces). Sad though, owner seems like a very nice man. Hope the lack of Rolex doesn’t hurt their foot traffic or revenues materially.

I wonder how long Duma in Warren, Ohio hangs on to being an AD now. Again, nice store but Rolex really seems to want to consolidate thier retail distribution.

[cascadez71]

There is money on the west side...but a rust belt town doesn't seem to rate much of interest to RUSA anymore. Miami, NY and LA showrooms will be all that is left at this rate. Or big chains like Ben Bridge, Tourneau, WOS, etc. which all seem to have lackluster customer service, maybe from staff turnover.

[Guppydriver]

Originally Posted by Underachiever

Just learned today that Rolex has dropped Cleveland’s west side AD and the Rolex website confirms it.

Makes some sense as they had not built out the store-within-a-store it appears Rolex demands now of its ADs and when I was in the store at the beginning of the month they had 7 watches you could buy (nothing on my list but some nice pieces). Sad though, owner seems like a very nice man. Hope the lack of Rolex doesn’t hurt their foot traffic or revenues materially.

I wonder how long Duma in Warren, Ohio hangs on to being an AD now. Again, nice store but Rolex really seems to want to consolidate thier retail distribution.

They’re dropping like flies it seems.

How does losing a product with a 30-40% margin that sells the instant it arrives not hurt the bottom line? It’s going to make quite a dent I bet (unfortunately).

[aczaja10]

Sad to see. Makes me want to stop supporting Rolex, frankly. Mom and pop stores are the bloodline of my community and I try to support those types of businesses whenever possible.

[vesnyder]

Are you referring to Kleinheinz? I thought they quit selling Rolex almost two years ago at least as an authorized dealer. The only AD's left in NE Ohio are Alson's and Sheiban's. Duma in Warren is a nice neighborhood jewelry store with a small Rolex boutique area but not sure how Rolex can justify a store in that small of a market?

[kittansett]

Which AD is this?

[kittansett]

Originally Posted by vesnyder

Are you referring to Kleinheinz? They quit selling Rolex almost two years ago. The only AD's left in NE Ohio are Alson's and Sheiban's. Duma in Warren is a nice neighborhood jewelry store with a small Rolex boutique area but not sure how Rolex can justify a store in that small of a market?

Cleveland only has Alson's.

[omar-rye]

Rolex dropping many ADs doesn't look good for those who value "relationship building."

[Hollie_Rollie]

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[Zach69SS]

Yes, friends very sad but true. Times change and it is unfortunate to see this happen to small family owned ADs. Rolex is not the same company it was 30-40 years ago, they are a juggernaut now and they want to control everything. Make every dollar they can and control of the market, new , pre-owned……. Why make 40% when you make 75% or more.

They don’t need the small ADs anymore, the Rolex brand is in a league of its own now.
So the million dollar build outs and other changes are there to achieve this in a nice way.

Eventually it will be Rolex the retailer and the other big guys like WoS. The personal attention and great customer service is gone. Maybe Rolex though Bucherer will bring back the personal touch and buying experience it once was?

[edyu]

Originally Posted by Guppydriver

They’re dropping like flies it seems.

How does losing a product with a 30-40% margin that sells the instant it arrives not hurt the bottom line? It’s going to make quite a dent I bet (unfortunately).

I agree but somehow I'm puzzled on the math. It just seems weird for any AD to not build out the Rolex boutique if indeed they are making a killing on Rolex alone (which I heard is true from at least 2 ADs).

[casadecamporolex]

Originally Posted by edyu

I agree but somehow I'm puzzled on the math. It just seems weird for any AD to not build out the Rolex boutique if indeed they are making a killing on Rolex alone (which I heard is true from at least 2 ADs).

RolexUSA makes every decision. AD could remodel and still get the letter.
AD is compelled to sign an annual vendor agreement with NY, which clearly states the ADs obligations and restrictions. AD has no rights.

[996marty]

Originally Posted by omar-rye

Rolex dropping many ADs doesn't look good for those who value "relationship building."

Very true. It kinda puts people in a corner

[BigWonton]

Originally Posted by kittansett

Which AD is this?

Pretty sure OP is referring to Sheiban

[BigWonton]

Originally Posted by Underachiever

Hope the lack of Rolex doesn’t hurt their foot traffic or revenues materially.

They did pick up Tag Heuer…

[EverCloserUnion]

Originally Posted by edyu

I agree but somehow I'm puzzled on the math. It just seems weird for any AD to not build out the Rolex boutique if indeed they are making a killing on Rolex alone (which I heard is true from at least 2 ADs).

An AD near where I work (London) opened a new store and claimed in a press release to have invested £3m in the site (including the Rolex store-within-a-store bit).

I suspect smaller operators will struggle to raise the finance if the repayment period far exceeds the length of the Rolex contract.

[1William]

Such is business.

[brandrea]

Another one bites the dust.

[Harry-57]

Originally Posted by Underachiever

Just learned today that Rolex has dropped Cleveland’s west side AD and the Rolex website confirms it.

Makes some sense as they had not built out the store-within-a-store it appears Rolex demands now of its ADs

If they opted not to do the in store build they dropped Rolex, not vice versa. If Rolex told them it wasn't required they would have known what was in the works a few years ago.

[train-time]

Originally Posted by Guppydriver

They’re dropping like flies it seems.

How does losing a product with a 30-40% margin that sells the instant it arrives not hurt the bottom line? It’s going to make quite a dent I bet (unfortunately).

Absolutely does! We had a long term AD that was in a very wealthy county that lost the AD status about 5 years ago. The store was like a ghost town afterwards and they they closed the store a couple months ago after not being able to get any other major brands to come in.

[Calatrava r]

I agree relationship building is a thing of the past if the ADs are subject to being closed without notice. Rolex apparently wants a much smaller retail partner network.

[rich-96db]

Originally Posted by BigWonton

They did pick up Tag Heuer…

Also, Bell & Ross. They're looking at a few others, but it's not going to take away the sting of losing the Rolex AD.

[davek35]

Down here in Columbus one of the 2 ADs (both are the same company) is building out to a bigger store, and will have an area for only Rolex and one for PP. 8 figure update for them. But I wonder if the other location here is Columbus will loose the AD.?? leaving only one AD here in Columbus. ?

[spinnaker226]

Originally Posted by Underachiever

Just learned today that Rolex has dropped Cleveland’s west side AD and the Rolex website confirms it.

Makes some sense as they had not built out the store-within-a-store it appears Rolex demands now of its ADs and when I was in the store at the beginning of the month they had 7 watches you could buy (nothing on my list but some nice pieces). Sad though, owner seems like a very nice man. Hope the lack of Rolex doesn’t hurt their foot traffic or revenues materially.

I wonder how long Duma in Warren, Ohio hangs on to being an AD now. Again, nice store but Rolex really seems to want to consolidate thier retail distribution.

it sucks but it's part of business. why split the margin with a retailer when you can capture all of the margin yourself?
this also allows them to control the flow of product how they see fit and eliminate shady AD practices.
if i were an AD and i could not get product that sells on a consistent basis (and be forced to sell product such as less desirable models), i would drop that vendor in favor for one that has a better product flow to meet demand. sure, the desirable models sell themselves, but being shipped unwanted product is part of why shady AD's were moving it out the back door to the grey market along with the highly desirable pieces/bundling/favoring one customer over the other, etc.

[edyu]

Originally Posted by EverCloserUnion

An AD near where I work (London) opened a new store and claimed in a press release to have invested £3m in the site (including the Rolex store-within-a-store bit).



I suspect smaller operators will struggle to raise the finance if the repayment period far exceeds the length of the Rolex contract.

Makes sense. This is actually what happened to my old AD too. Of course since then I talked to a couple of other ADs and they were incredulous why would any AD not expanding.

Ok back to topic, I know my local AD is family owned and it has actually expanded to the major city close by.

[vesnyder]

Wow! Did not realize we lost another AD in NE Ohio? Looks like Thom Duma is hanging in there - for the time being!

[SubDate]

Don’t forget, buyers will buy Rolex no matter how difficult it becomes. It will be more difficult yes, but it will not stop them. That is what’s keeping everything moving. As indicated above, they sell instantly.