Suggested price question

[New Buyer]

Rolex likes to regulate their AD's. They even publish a recommened price list but how can that be accurate?

There are some countries that they have a 10% luxury tax right off the top. On a $10,000 watch, that is significant. The retail price structure would go right out the window in order to try to compare Mexico-US-Canada with varying tax systems.

What happens if a AD wants to be as large as Walmart and sell many, many more Rolex at a smaller profit margin but they make up the difference by selling more? Can Rolex cut them off because they are not selling at high enough profit?

After all that, my biggest question is where would be the absolute BEST place to buy a Rolex from an AD?

This is the $64,000 question... where is the best place.

It depends on if your country has import duties that are heavily enforced. Many ADs in the Caribbean have great prices, and lots of people wear their watches home without declaring them.

I have also heard from a friend that Hong Kong is excellent for prices, because there are so many ADs in such a concentrated area, they'll wheel and deal, to a degree. Again, how you get your watch back in your country is another issue. If you don't get caught with empty boxes in your luggage, you're laughing. Or, you could leave the boxes behind. DO NOT mail them to your home, cuz customs will inspect them and send you the bill for the tax on the average price of a Rolex.

Rolex seems to set their prices relative to the global market, taking into consideration the local taxes, and dollar value. The prices are pretty similar... but if you happen to be in Hong Kong, it's worth a look.

[C.J.]

I just went back and forth with several AD's. Most said that if they gave to much of a discount on certain models, especially the oyster professional line, Rolex would would pull their authorization to sell the product. I'm not sure if I believe them though. I'm sure some of the folks here will know for sure.

[dfn8tly]

Because Rolex has perhaps the highest brand recognition name in luxury watches they can, and do react with impunity whenever they perceive a threat to their established pricing structure. The concern here is not the AD who offers a 10 - 15% discount to move a piece that has been in his inventory for 6 months. Rolex's nightmare is the establishment of a semi-legitimate secondary market (not gray market) within their existing distributorships.

Some countries, including the U.S. have laws prohibiting the restraint of trade and competition. Retail prices can only be "suggested" by the manufacturer. Although pricing is not constrained it is controlled by the annual reauthorization or adjustment of the dealer network in a given geographic area. Hence, Rolex can and has been known to decline renewal of a dealer's sales agreement without reason being given. This does NOT happen frequently as they certainly don't want a reputation of slashing, burning and pillaging through the retail marketplace either. Kind of like a benevolent Attila the Hun.

When it all rolls out the best pricing you're going to find will most likely be an AD who knows you and wants your future business.

[JJ Irani]

Good post, Richard!!

[Rockrolex]

My AD is willing to negotiate on most Rolex models, as well as most models of other brands. Generally, they will do 5-10% on standard established models. I have not asked about hard to get models or the specifics of their discount policies.

Having said that, I've usually found better deals elsewhere, but I've been lucky so far. Of course, I give up the security of getting my watch from the AD, but I've never really been concerned about that. Most of my Rollies are well outside the warranty period anyway, so that is a non-issue.

[Mr. K]

I like buying from an AD. But my first Rolex turned out to be a frankenwatch at a good price. Lesson learned.

I also, like the fact that Rolex is NOT heavily discounted. I may be in the minority, but on some watches 30% to 50% can be had. Those kind of watches make me think of invicta. The retail price just becomes a base for the discount to start.

We all pay about the same price for a new Rolex from an AD. Some a little less than others, but having a strict pricing structure helps add to the image and credability in the sense that Rolex will never be known as a discount watch.