How do non-authorized dealers work?

[sfrolex]

Why can I buy a Rolex online from a non-authorized dealer, but cannot have it serviced by Rolex? Rolex controls the flow of their product, so why don't they avoid selling to non authorized dealers? Or do I misunderstand the nature of an AD?

[scottschoe]

Rolex will service your watch (at cost) no matter where you bought it from.

[sfrolex]

Originally Posted by scottschoe

Rolex will service your watch (at cost) no matter where you bought it from.

Then I revise my question: what does "authorized" in AD mean?

[Art161]

Originally Posted by sfrolex

Then I revise my question: what does "authorized" in AD mean?

Authorized means that Rolex will sell directly to the dealer, let them display Rolex symbols in their stores, and show the stores on the Rolex Web site.

In most cases, I think ADs also provide service. Rolex will sell them parts.

[Z-Sub]

The 2 year warranty that usually comes with a brand new watch is only available if the watch is sold by AD.
Rolex will service the watch but not free under warranty even if the watch just left the factory days before.

[MrCowboy99]

As they say in the car business, "stack'm deep and sell'm cheap"

[GBJIV]

I asked a similar question before - appears that the consensus is that some of the biggest customers of the AD's are the Non AD's and they probably get a significant discount from the AD's - and the AD's get to move much more product. That being said - it was mentioned that a bunch of the Non AD inventory here in the U.S. seems to come from other parts of the world. Maybe in some areas they do not move as much product and are willing to sell it in quantity for a larger discount? Not sure. It's an interesting business to say the least.

The AD's probably have to move a certain number of units in order to maintain status and get new allotments of inventory to sell. So, moving "units" to the grey market may be in their interests.

Again, I am really just guessing. I think it is a fascinating model Rolex has and it seems to be fairly mysterious on several levels.

[BigHat]

Originally Posted by GBJIV

I asked a similar question before - appears that the consensus is that some of the biggest customers of the AD's are the Non AD's and they probably get a significant discount from the AD's - and the AD's get to move much more product. That being said - it was mentioned that a bunch of the Non AD inventory here in the U.S. seems to come from other parts of the world. Maybe in some areas they do not move as much product and are willing to sell it in quantity for a larger discount? Not sure. It's an interesting business to say the least.

The AD's probably have to move a certain number of units in order to maintain status and get new allotments of inventory to sell. So, moving "units" to the grey market may be in their interests.

Again, I am really just guessing. I think it is a fascinating model Rolex has and it seems to be fairly mysterious on several levels.

You are on the money.

The non-ADs or "grey market" as we commonly call them have a love/hate relationship with ADs. ADs want to be able to lay off excess inventory to the GM when it benefits them, but also don't want you to buy from them.

Rolex is viewed by some as "Big Brother" with total visibility on all the watches in the supply chain, yet their watches show up outside the normal AD system. How can that be? Either they don't have that level of control or they don't care.
The reality is all watch makers, many much more exclusive than Rolex, also fail to control sales outside the dealer network.

Any luxury brand wants to closely manage their pricing for the obvious reasons, it's just very hard to do in practice.

[Tombstone]

I like the AD relationship as you can find non-AD prices with an AD if you find the right AD. Secondly yes you get the 2 year warrantee, and last there is nothing questionable about the watch integrity (no swapped out parts, no band changes, no excessive buffing of the watch to remove scratches ect.) Many people who know nothing about Rolex have been taken over the years by trying to save $500.00 or less. Is it worth it? Not to me. IMHO

[DSJ]

Rich, love the RR pic on your avatar!