Precedence for SS short supply?

[elysium73]

Sorry, if this has already been answered, but it's hard to comb through all the threads on SS shortage.

My question is whether there's been a precedence for this shortage in the past or is this uncharted territory?

Like many, I'm adverse to paying a premium and don't mind waiting for the LV (my thinking is it can't keep skyrocketing for the next year or two, can it?). But I would appreciate any insight if Rolex in the past has ever increased the supply or did production level merely stay the same with demand dipping or correcting itself based on market. Thanks!

[Bigblu10]

Hard to answer your questions. We are in unchartered waters, demand is outstripping supply. But grey dealers have plenty of watches for a big premium.

[droptopman]

I have not seen anything like this in the 30 years I have been wearing Rolex. A little bit with the 5 digit Daytona, but only the Daytona, not the rest of the SS professional models. Pretty active trader over the years. With vintage it can be hard to find a reference in the condition/model you are looking for, but they are not producing them anymore so that makes sense. The world has gone Rolex crazy and demand is just really high.

[THC]

To an old guy that has been around, ADs used to have bountiful
amount of selections in their display cases. My honest opinion is The Internet has caused retail Armageddon around the world, and Rolex is getting caught up in it..

They need to surrender and have an on line presence, which will torpedo grey dealers, but never happen sadly

[CaliBear]

I’m no economist but when the whole world is buying Rolex’s, trouble is in the horizon.

[lecorsaire]

There is no precedent for this situation. Of course there is high demand for steel sports models but I don't believe anymore than after the ceramic Daytona was unveiled.

What we have here is mostly driven by speculation otherwise watches from other brands would be unavailable but that is not the case except for steel Nautilus/Aquanaut and most steel variations of the Royal Oak.

People see that these watches have wait times how ever long or short they may be and resell for much more than retail so more people come into the market to flip them for a quick profit. I would say 40-50% of those buying steel sports right now are not doing so with the intention of either keeping them or wearing them.

I've seen listings even trying to get a premium on steel DJ41 saying that they're rare lol!

Personally I don't think there are many takers at the extreme end. The BLRO was selling for 22k earlier in the year and now it's more like 17-17.5. Even though it may take a year or two for things to go back to how they were, I sincerely think they will. The hype will die down. People can only talk about the same dozen watches before becoming completely exhausted.
People in it for fashion or showing off the latest watch on IG will hop on to the next trend.

[The Libertine]

Some claim shortages. Others are able to walk in, and find the SS model they wanted. A few are willing to pay a ridiculous premium for a newly released model, while many are more apt to wait for the hype to die down.

[lecorsaire]

Originally Posted by THC

To an old guy that has been around, ADs used to have bountiful
amount of selections in their display cases. My honest opinion is The Internet has caused retail Armageddon around the world, and Rolex is getting caught up in it..

They need to surrender and have an on line presence, which will torpedo grey dealers, but never happen sadly

Watch manufacturers are conservative entities. Luxury goods have always been sold through boutiques and I don't see this changing now nor in the future. People get satisfaction walking into a boutique, trying stuff on, perhaps getting some complimentary champagne and walking out the door with a nice bag.

It will be very difficult to get rid of this custom. It's like buying a car unless you're getting a Tesla. You want to sit in it. You want to go on a test drive. The Internet cannot replace these things.

[lecorsaire]

Originally Posted by The Libertine

Some claim shortages. Others are able to walk in, and find the SS model they wanted. A few are willing to pay a ridiculous premium for a newly released model, while many are more apt to wait for the hype to die down.

Those that can get what they want walking in are the ones that buy several watches every year. I know that some have gotten lucky with no prior history but that's maybe one of out every 500 or more.

[lenfried29]

Originally Posted by THC

To an old guy that has been around, ADs used to have bountiful
amount of selections in their display cases. My honest opinion is The Internet has caused retail Armageddon around the world, and Rolex is getting caught up in it..

They need to surrender and have an on line presence, which will torpedo grey dealers, but never happen sadly

+1

[lecorsaire]

Originally Posted by lenfried29

+1

Be very careful what you wish for! If they go to online only, direct to customer, none of us will ever be able to get one for retail again! There's this thing called a BOT.

Nike and Adidas did the same thing with limited sneakers and very quickly programmers automated the process so that you can select what you want and check out in the time it takes you to click a single link. We're talking milliseconds here.

For the finance guys here, think HFT.

[lenfried29]

Originally Posted by lecorsaire

Be very careful what you wish for! If they go to online only, direct to customer, none of us will ever be able to get one for retail again! There's this thing called a BOT.

Nike and Adidas did the same thing with limited sneakers and very quickly programmers automated the process so that you can select what you want and check out in the time it takes you to click a single link. We're talking milliseconds here.

For the finance guys here, think HFT.

Sure. But can be regulated better than AD selling to GD. I know, one can found a lot of reasons not to do it. But at least some ideas need to be put on the table for discussion.

[JacksonStone]

Originally Posted by THC

My honest opinion is The Internet has caused retail Armageddon around the world, and Rolex is getting caught up in it..

I think the Internet amplifies consumer behavior, which is ultimately dependent on prevailing market conditions. Internet commerce has been in full effect for 15 to 20 years now. It didn't cause a demand spike in the darkest hours of the financial crisis ten years ago, or even two years ago when insiders were saying how dire the situation had gotten for the Swiss watch industry. This "shortage" (whatever it really is) has only been going for a year or so. The Internet didn't cause it.

That said, I think the Internet does allow a feedback loop to form for people who are into certain pursuits, which results in an acceleration and heightened sense of importance of the information being traded, as well as a loss of perspective and common sense. FOMO, rapid spread of rumors, more easy access to buyers and sellers and markets, and the like, have created the means for this kind of situation to happen. In other words, the Internet is an enabler. But it still has to have something to enable.

[TickTockChuck]

Everything goes in cycles, so inevitably there will be a downturn. I seem to remember during the holiday season in 2015 there were virtually no Rolex sports models available at ADs, at least in Canada. Throw in boom/busts in Asia, arguably the most significant Rolex market, you then get wild swings in demand. Nobody will argue that demand is quite frothy now and yellow lights are flashing. So proceed with caution and don't pay much over MSRP if you can wait a bit. You'll see large numbers of the hot references on Chrono24 and similar internet sites. My 2 cents. Good luck in your decision. Cheers!

[meyers]

Originally Posted by JacksonStone

I think the Internet amplifies consumer behavior, which is ultimately dependent on prevailing market conditions. Internet commerce has been in full effect for 15 to 20 years now. It didn't cause a demand spike in the darkest hours of the financial crisis ten years ago, or even two years ago when insiders were saying how dire the situation had gotten for the Swiss watch industry. This "shortage" (whatever it really is) has only been going for a year or so. The Internet didn't cause it.

That said, I think the Internet does allow a feedback loop to form for people who are into certain pursuits, which results in a heightened sense of importance of the information being traded, and a loss of perspective and common sense. FOMO, rapid spread of rumors, more easy access to buyers and sellers and markets, and the like, have created the means for this kind of situation to happen. In other words, the Internet is an enabler. But it still has to have something to enable.

Well said

[SS Oyster]

Originally Posted by THC

To an old guy that has been around, ADs used to have bountiful

amount of selections in their display cases. My honest opinion is The Internet has caused retail Armageddon around the world, and Rolex is getting caught up in it..



They need to surrender and have an on line presence, which will torpedo grey dealers, but never happen sadly

Rolex would kill it (never needing ADs), get full retail for all models, not just 60%, and we would get what we want at MSRP (which might even drop by cutting out the AD).

However, the greys are smart to have captured the web market, especially the big guys like Crown & Caliber, Bob’s, Chrono24 and others .,. Even Amazon!

I called the only AD in Santa Rosa, CA, and first person told me I could just order a Pepsi and it might take like 2 months or go on list and wait years. I was intrigued thinking they might have figured this out, but alas the owner called me back and told me that there was no such thing. Well there should be. He even said his Pepsi lust was too long to add anyone, which is the same I got from Corte Madera AD.


Sent from my iPhone using Tapatalk

[JacksonStone]

Originally Posted by SS Oyster

He even said his Pepsi lust was too long to add anyone...

Freudian slip?

[Filmprolv.com]

Originally Posted by lecorsaire

Watch manufacturers are conservative entities. Luxury goods have always been sold through boutiques and I don't see this changing now nor in the future. People get satisfaction walking into a boutique, trying stuff on, perhaps getting some complimentary champagne and walking out the door with a nice bag.

It will be very difficult to get rid of this custom. It's like buying a car unless you're getting a Tesla. You want to sit in it. You want to go on a test drive. The Internet cannot replace these things.

All true however I was watching a show that shows people purchasing and “building” their new car sight unseen and picking it up from a giant automatic car vending machine. With not trying on or test driving.

[jlovda]

Make the warranty good for the original buyer only, non-transferable, like Mcintosh audio does and force the AD to record it. I cannot see there being any difficulty creating a database of initial watch buyers for warranty purposes. It would force greys to provide their own third party servicing. Some might do it, many wouldn't. Would help with stolen watches also.

[elysium73]

Originally Posted by JacksonStone

I think the Internet amplifies consumer behavior, which is ultimately dependent on prevailing market conditions. Internet commerce has been in full effect for 15 to 20 years now. It didn't cause a demand spike in the darkest hours of the financial crisis ten years ago, or even two years ago when insiders were saying how dire the situation had gotten for the Swiss watch industry. This "shortage" (whatever it really is) has only been going for a year or so. The Internet didn't cause it.

That said, I think the Internet does allow a feedback loop to form for people who are into certain pursuits, which results in an acceleration and heightened sense of importance of the information being traded, as well as a loss of perspective and common sense. FOMO, rapid spread of rumors, more easy access to buyers and sellers and markets, and the like, have created the means for this kind of situation to happen. In other words, the Internet is an enabler. But it still has to have something to enable.

I agree with this and suspect the echo-chamber of "buy, buy, buy!" especially because of FOMO and spread of rumors has played a part in driving the market value up. Almost like we're doing it to ourselves because of the times we live in and the availability of said watches. Maybe a type of perfect storm... for now.

Originally Posted by TickTockChuck

Everything goes in cycles, so inevitably there will be a downturn. I seem to remember during the holiday season in 2015 there were virtually no Rolex sports models available at ADs, at least in Canada. Throw in boom/busts in Asia, arguably the most significant Rolex market, you then get wild swings in demand. Nobody will argue that demand is quite frothy now and yellow lights are flashing. So proceed with caution and don't pay much over MSRP if you can wait a bit. You'll see large numbers of the hot references on Chrono24 and similar internet sites. My 2 cents. Good luck in your decision. Cheers!

Interesting note about the holiday season in 2015. Perhaps an anomaly.

Yea, I'd hate to buy at peak premium for it to start to decline right after. By "frothy" and "yellow lights" do you mean it's slowing down? My observation is that it has seemed to plateaued and I don't imagine it climbing higher, so I'm going to wait for the hype to die down, prices to decrease, hopefully making the LV more readily available.

[Glidelock]

In your post you say your interested in an LVC and then state that it can’t continue to go up for the next two years...followed by you questioning that thought.

Logically, I would tell your you are right. However, my logic is absolutely flawed based on well over 20 years of buying and watching Rolex sports models go up at a ridiculous pace, and not once...ever truly have a period of sustained correction! In 2000 SS Sub Dates were on a wait list throughout the West Coast. Took me 3 months to get one, and I only got it because it came in and they were not reaching people ahead of me. This wasn’t their line...I simply had been calling every AD on a daily basis. Called the same AD 2 days in a row, and my rep said one just arrived by FedEx and I’ve left messages for 3 people...how fast can you get here? Bewm!!! Was there in 20 min paid full retail of $2,795 and as I was about to leave, she said she had something very special for me that arrived on the same shipment!? She then proceeded to pull out of the FedEx packaging a white SS Zenith Daytona and offer it to me for the ridiculously newly increased retail price of $6,600!

To which I ever so confidently walked away from, as I’m pretty sure my Ex Wife would have divorced me for buying it!!!

That watch now sells for $30k used!

Even 16520 non Zeniths are at the $15k level...used!

Even funnier though is I have learned my lesson at least a little bit, as when I bought my LVC and SDC4K, they were both NIB, 1st year of release...and under $8k, because they were not originally well received!

It seemed like nearly every thread on the Hulk was 90% filled with negative response...

Same with the most unpopular SDC4K...which even in the last 6 months several threads with people whom predict it’s never gonna be popular or go up much in value. In fact...saying that once the SD43 hit the stores, the SDC4K would even drop in value!? Unpopular Rolex Watches have a way of becoming very desirable, especially when no longer produced!

That SDC4K quickly became my favorite and daily beater years ago...and an 16610 as well as an 116610LN eventually left the stable!

So...find your LVC, pay the price and be done with it. Because not only are they likely to increase in price...they might even discontinue it someday, and if that happens you may miss any chance you had!

[HogwldFLTR]

Harley in '97 was selling used bikes for new bike prices. By 2001 there was abundance. In 2008 Martin guitars were going crazy, couple of years later they crashed and were having trouble filling the Nazareth factory. Rolex will come around.

[WatchLurv]

It's a shortage. Period. ADs would get 1 submariner a week. Now they get 1 a month. You tell me if this isn't shortage.

[SackLVG]

Originally Posted by lecorsaire

Be very careful what you wish for! If they go to online only, direct to customer, none of us will ever be able to get one for retail again! There's this thing called a BOT.

Nike and Adidas did the same thing with limited sneakers and very quickly programmers automated the process so that you can select what you want and check out in the time it takes you to click a single link. We're talking milliseconds here.

For the finance guys here, think HFT.

Lol. The difference between running a $300 prepaid visa
gc and a $10k visa charge will stop bots completely.

They don’t need to put up a Shopify checkout, its simple as buying a car from a manufacturer like Tesla. Sure you have wait, but they can ship it out to you or send it to your favorite ad. No games. put a down payment, they give a time frame and notify you when it’s ready.

Rolex doubles their margins and increases their customer information base.

[Fleetlord]

Originally Posted by SackLVG

Lol. The difference between running a $300 prepaid visa
gc and a $10k visa charge will stop bots completely.

They don’t need to put up a Shopify checkout, its simple as buying a car from a manufacturer like Tesla. Sure you have wait, but they can ship it out to you or send it to your favorite ad. No games. put a down payment, they give a time frame and notify you when it’s ready.

Rolex doubles their margins and increases their customer information base.

How does this increase Rolex factory margins?

All Rolex does now is manufacture watches and sell them to AD's around the world.

The cost of sale is entirely on the back of the authorized dealer....every penny of it...build outs, displays, employees, marketing, financing fees...all of it..

Sure Rolex could raise the retail price , but that would just cover the infrastructure they would have to put in place to make this interneting stuff work. That all costs $$.

Plus, Rolex already has a very effective online platform and they don't pay a cent for that either....the grey market.

Rolex has no desire to eliminate the grey market, they just want to control the pricing to protect the brand image, which has happened quite nicely in the last year or so...

[Chester01]

People keep talking about demand. I am not sure I agree. Years ago, you walk into an Ad and either buy or place an order (though may be a wait with the ss Daytona). There were no forums with small time sellers, no large gray dealers, and no real functional internet. These other “dealers”
Have siphoned off the supply of Rolex as they know they can sell above premium. If you take all the Daytona C’s Sub C’s hulks, and BLRO/BLNR’s from the grays put them back into the AD’s shelves I guarantee folks would have a much easier time sourcing the watches. The most likely explanation is not demand, rather Rolex cutting supply and tightening their rules to choke out the gray’s. I’m not sure this will work however.

[FirstF80InSpace]

The only thing I can think of is Panerai a few years ago was the hot watch. Mind you, it was nothing like the Rolex SS shortage, but demand was pretty high for Pannies. Then the demand suddenly fell off the map. Probably as people gravitated towards Rolex.

The shortage isn't just hitting Rolex. AP and Patek are seeing the same thing. Bottomline is that there has been unprecedented demand for luxury watches in the past couple of years. My thinking is this will change when a global recession hits. Not a matter of if, but when. We've had a 10 year bull market. We're due for a correction, that may or may not have already started...

[Art 1]

Originally Posted by HogwldFLTR

Harley in '97 was selling used bikes for new bike prices. By 2001 there was abundance. In 2008 Martin guitars were going crazy, couple of years later they crashed and were having trouble filling the Nazareth factory. Rolex will come around.

As an aside, at that time in Florida any way, to buy a new Harley one had to trade in a used, so that often meant buying a used one from a dealer to sell it back to buy a hot model. Now, the Harley places I see in Central Florida have thousands on new ones waiting to be sold.

[Sebastian5]

Originally Posted by jlovda

Make the warranty good for the original buyer only, non-transferable,

I don't think that's gonna work. Some greys already work like that so they don't have to disclose the AD source. Jomashop springs to mind, they give their own warranty (of 2yrs instead of 5). Greys will find a workaround.

In the end, demand exceeds supply by far and as long as that's the case you won't see any difference.

[Sebastian5]

Originally Posted by FirstF80InSpace

The shortage isn't just hitting Rolex. AP and Patek are seeing the same thing. Bottomline is that there has been unprecedented demand for luxury watches in the past couple of years. My thinking is this will change when a global recession hits. Not a matter of if, but when. We've had a 10 year bull market. We're due for a correction, that may or may not have already started...

Not only watches, booms going on in almost every (collectible) asset class. Real estate, (vintage) cars, art, stocks.

Money is cheap