Grey dealer prices and paying the premium

[GSolo]

Hi everyone

I'm in a situation where I'm trying to build a relationship to my local AD and I'm also on the list for an OP, lately however I've started to take a look at grey dealer prices here where I live and I'm trying to figure out if I should go down that route, pay the premium and just be done with it.

For example one dealer has a 126300 Datejust with blue dial from 2019 listed at $10.200 and a silver dial OP41 listed at $9560.

Now I've seen some debate here and there that it's not "worth" paying the premium for an OP since it's not as well regarded and desired as lets say datejusts and subs.

I guess what I'm trying to figure out is what is the fair value on these watches? It seems that a used 2019 datejust is a "better deal" price wise than going for an new OP41?

[2001jesper]

Only you can decide whether paying a premium holds value to you vs. playing the waiting game

Would personally wait and get recognised for purchase at the AD. We all know that the OP/ Datejust won't be your last piece

[rmlovett1]

Time vs money…..I choose time. I’d rather enjoy now.

[garyk]

Originally Posted by Richris1

Time vs money…..I choose time. I’d rather enjoy now.

Yes….

[joli160]

Money is just that, I can’t see myself begging and kissing up an AD.
I buy grey without silly games

[TexEd]

Originally Posted by Richris1

Time vs money…..I choose time. I’d rather enjoy now.

Exactly my view...I'm willing to pay a premium and have it now.

[GMT Aviator]

Originally Posted by TexEd

Exactly my view...I'm willing to pay a premium and have it now.

So if they grey price on say a Pepsi we’re to double from the current absurd Grey prices you’d still pay it?

[TexEd]

Originally Posted by GMT Aviator

So if they grey price on say a Pepsi we’re to double from the current absurd Grey prices you’d still pay it?

I stated that I would pay a premium and that premium would be what I would be willing to pay. The percentage over msrp would depend upon what it is I am buying and my level of desire. The same could be applied to cars, boats, or even homes.

[askdanny]

Originally Posted by GMT Aviator

So if they grey price on say a Pepsi we’re to double from the current absurd Grey prices you’d still pay it?

What a sentence.

[1William]

It depends on the watch and the premium being charges. How badly do you want the watch and what is the outlook for relief from the manufacturer though increased production or another situation. I have no issue buying through our Trusted Sellers and find them to very professional and straight dealers on watches. The relationship with an AD is based on time and money. If you had the money and was willing to part with it you would already have the watches you want from the Gray Market and we would not have this thread. If you had a long standing relationship with the AD you might qualify for a watch or two but unless you have spent significant amounts, I have and they still don't come through. Or you have another type of relationship, I am neighbors with my AD who is also the owner, and we work out at the same gym at the same time. Maybe it is just me but the demand and supply issues are so strong that it is tough. I would go find the watch you want through a Trusted Seller and negotiate your best price, buy it, enjoy it and move on. Good luck.

[Benzsiam]

I think it depends on how many watches that you plan to have in the future. If it’s only one or two, it might be better to get from trusted seller so you can enjoy without waiting. If you plan to collect more, it would be better to get it from the boutique/AD so you build up the good relationship with them for future purchases.

[GSolo]

Originally Posted by Benzsiam

I think it depends on how many watches that you plan to have in the future. If it’s only one or two, it might be better to get from trusted seller so you can enjoy without waiting. If you plan to collect more, it would be better to get it from the boutique/AD so you build up the good relationship with them for future purchases.

I guess you're right about that, my relationship with the AD is fairly new, but it's slowly building, I've only bought one watch from them previously but I'm planning to add more as we go along. They're also Omega AD so might pickup a Seamaster or Speedmaster but still even if I buy one of those I can't be sure that it will "bump" me up for a Rolex at some point and that's kind of my concern hehe.

[Benzsiam]

Originally Posted by GSolo

I guess you're right about that, my relationship with the AD is fairly new, but it's slowly building, I've only bought one watch from them previously but I'm planning to add more as we go along. They're also Omega AD so might pickup a Seamaster or Speedmaster but still even if I buy one of those I can't be sure that it will "bump" me up for a Rolex at some point and that's kind of my concern hehe.

Normally if it is the same AD that carry multiple brands, they should count all items that you purchase from them. Don't buy something that you don't really like in order to get something you like, it isn't worth it.

If you like Rolex more than Omega, buy only Rolex. Not too long after Covid is getting better, watches market should come back to normal like before Covid. At that time, some Rolex models like DateJust, Air King ....should be available without long wait. You can get DateJust first to build up your relationship, next one can be Sub ND...and not to long, you will whatever you ask for with some wait time.

All of these, it depends on your luck too. If you have a good luck, you will get good SA at good AD, many things will come your way.

Wishing you a good luck!

[Boaters]

I always go grey waits are way to long and no AD'S out where I live to speak of.

[IamJacky]

Only you can decide what is fair value because we all have different opinions on different models. The market prices simply reflect the popularity of the particular watch as a whole, the more in-demand the higher premium they commend, but at the end of the day, it's how you view and feel about the watch. Not us. I love GMT Master II and less so about the Sky Dweller, and so I have my own "fair" price tag on both pieces and they may not align with the market prices.

Also, as others have mentioned, it's about what your plans are in terms of watch collecting. Do you have a set of few pieces you absolutely want and be done with, or do you plan on exploring and amass a collection of variety of watches the AD in the long run?

[xrole]

Originally Posted by GSolo

Hi everyone

I'm in a situation where I'm trying to build a relationship to my local AD and I'm also on the list for an OP, lately however I've started to take a look at grey dealer prices here where I live and I'm trying to figure out if I should go down that route, pay the premium and just be done with it.

For example one dealer has a 126300 Datejust with blue dial from 2019 listed at $10.200 and a silver dial OP41 listed at $9560.

Now I've seen some debate here and there that it's not "worth" paying the premium for an OP since it's not as well regarded and desired as lets say datejusts and subs.

I guess what I'm trying to figure out is what is the fair value on these watches? It seems that a used 2019 datejust is a "better deal" price wise than going for an new OP41?

The fair value for those watches is MSRP.

[Snerks]

Originally Posted by xrole

The fair value for those watches is MSRP.

In what fairytale land is open market value not fair value?

MSRP is a discount right now. Period. Ignoring simple economic principles is quite naive and not doing anyone any favors.

[Mendota]

Originally Posted by Snerks

In what fairytale land is open market value not fair value?

MSRP is a discount right now. Period. Ignoring simple economic principles is quite naive and not doing anyone any favors.

Respectfully, multiple economic principles are at play, however, and what is happening goes far beyond simple and basic introductory econ. You and I didn't learn these dynamics in our basic courses. It wasn't until macro and micro and more specialized courses where we started to deal with some of these unique circumstances, right? Put them all together into a once in a century market event and very few, if any, courses that we took ever discussed this. At least none of mine did for undergrad.

When you have supply chain dynamics that are restricting supply, coupled with unprecedented stimulus money, additionally coupled with pent up demand due to increased discretionary spending because entire economies voluntarily shut down, you have a market anomaly. There is a decoupling of traditional supply and demand and what we are experiencing with the grey channel is a pricing discrepancy due to this unprecedented surge in demand and at the same time an abnormally low supply due to these short term variables. The curves of supply vs demand are both going away from each other exponentially. This is the anomaly. While this market anomaly is playing out, it's an abnormal market as far as asking prices from greys are concerned. We are seeing this in many other sectors, as well, right now. $1,500 slow boat shipping containers from China to Long Beach are well over $10,000 right now. Lead times on basic equipment and raw materials are months long. This is all going to stabilize at some point but until then the greys are going to ask what they want. That's OK. It's up to the consumer to decide if they will pay that, negotiate, or just wait. There is no wrong answer. It's all personal choice. Just like the shipping containers. Some are waiting, and some are biting the bullet and paying $20,000 to have the container expedited to arrive in less than 6 weeks.

Just my opinion.

[Snerks]

Originally Posted by Mendota

Respectfully, multiple economic principles are at play, however, and what is happening goes far beyond simple and basic introductory econ. You and I didn't learn these dynamics in our basic courses. It wasn't until macro and micro and more specialized courses where we started to deal with some of these unique circumstances, right? Put them all together into a once in a century market event and very few, if any, courses that we took ever discussed this. At least none of mine did for undergrad.

When you have supply chain dynamics that are restricting supply, coupled with unprecedented stimulus money, additionally coupled with pent up demand due to increased discretionary spending because entire economies voluntarily shut down, you have a market anomaly. There is a decoupling of traditional supply and demand and what we are experiencing with the grey channel is a pricing discrepancy due to this unprecedented surge in demand and at the same time an abnormally low supply due to these short term variables. The curves of supply vs demand are both going away from each other exponentially. This is the anomaly. While this market anomaly is playing out, it's an abnormal market as far as asking prices from greys are concerned. We are seeing this in many other sectors, as well, right now. $1,500 slow boat shipping containers from China to Long Beach are well over $10,000 right now. Lead times on basic equipment and raw materials are months long. This is all going to stabilize at some point but until then the greys are going to ask what they want. That's OK. It's up to the consumer to decide if they will pay that, negotiate, or just wait. There is no wrong answer. It's all personal choice. Just like the shipping containers. Some are waiting, and some are biting the bullet and paying $20,000 to have the container expedited to arrive in less than 6 weeks.

Just my opinion.

Absolutely! There is a huge difference between what fair market value is, and your personal choice on what you are willing to pay.

[Mendota]

Originally Posted by Snerks

Absolutely! There is a huge difference between what fair/market value is, and your personal choice on what you are willing to pay.

Completely agree! Interesting times for sure!

Sent from my SM-G986U using Tapatalk

[dannyp]

Originally Posted by Snerks

In what fairytale land is open market value not fair value?

MSRP is a discount right now. Period. Ignoring simple economic principles is quite naive and not doing anyone any favors.

The best way to think about it is this: ADs aren't really retailers, they're wholesalers. They are supplying the "retail" market at wholesale prices. In the true "retail" market, there is no MSRP, but just a market-set price. Some are lucky enough to have a relationship and "know a guy," allowing them to purchase at wholesale, rather than retail.

[Kelvin Knight]

Originally Posted by dannyp

The best way to think about it is this: ADs aren't really retailers, they're wholesalers. They are supplying the "retail" market at wholesale prices. In the true "retail" market, there is no MSRP, but just a market-set price. Some are lucky enough to have a relationship and "know a guy," allowing them to purchase at wholesale, rather than retail.

No. No one at the consumer level can buy directly from Rolex at wholesale price. The AD’s are literally a trusted servant of the brand and it’s bridge into the retail sector. They get to pay wholesale prices solely because they bare all the risk of overhead and consumer market volatility.

[dannyp]

Originally Posted by Kelvin Knight

No. No one at the consumer level can buy directly from Rolex at wholesale price. The AD’s are literally a trusted servant of the brand and it’s bridge into the retail sector. They get to pay wholesale prices solely because they bare all the risk of overhead and consumer market volatility.

No sh1t. I’m saying that the ADs have essentially become an additional layer of “wholesaler,” in the economic/practical sense. Nothing about the available avenues of purchase have really changed.

[Wahlberg]

Originally Posted by dannyp

The best way to think about it is this: ADs aren't really retailers, they're wholesalers. They are supplying the "retail" market at wholesale prices. In the true "retail" market, there is no MSRP, but just a market-set price. Some are lucky enough to have a relationship and "know a guy," allowing them to purchase at wholesale, rather than retail.

Gibberish. They aren't wholesale prices. Stop making up stuff and calling it that.

[Explorer2polar]

Hell will freeze over before a spend a penny at the Grey dealers !

The very thought of the original buyer flipping it to a Grey dealer for the sole purpose of making a few ££$$ boils my urine, why should they hijack the market and hold it to ransom ?

No Grey dealers would starve if everyone refused to pay the premium.

[WalterW]

Originally Posted by Explorer2polar

Hell will freeze over before a spend a penny at the Grey dealers !

The very thought of the original buyer flipping it to a Grey dealer for the sole purpose of making a few ££$$ boils my urine, why should they hijack the market and hold it to ransom ?

No Grey dealers would starve if everyone refused to pay the premium.

Did you know Grey dealers also sell many watches under msrp?

[Snerks]

Originally Posted by WalterW

Did you know Grey dealers also sell many watches under msrp?

how dare they

[doublevanose82]

Originally Posted by Explorer2polar

Hell will freeze over before a spend a penny at the Grey dealers !

The very thought of the original buyer flipping it to a Grey dealer for the sole purpose of making a few ££$$ boils my urine, why should they hijack the market and hold it to ransom ?

No Grey dealers would starve if everyone refused to pay the premium.

[bp1000]

I always wait for my watches. Apart from a very limited few, most come within 2 years.

I have accepted the chances of getting certain pateks just won’t happen for me right now. So I deal with it and get other things.

[doboy007]

Fair value for ME is below MSRP for those pieces (like several years ago from grey) because they are not my favorite watches. But that may be different for YOU. I would just practice patience and wait one from an AD.