Rolex Supply Chain Question

[Patrick2278t]

I'm looking into getting a DD40 and have secured one at $25.5K from a local dealer. However, I'm in the manufacturing / wholesale business myself which got me thinking... does anyone know how Rolex's supply chain works? Is it the typical manufacturer to distributor to retailer? I understand the average retail margin on Rolex is 40%, meaning a DD40 would be purchased by a retailer for approx $20.5K. Do they buy direct from the factory or is that from a wholesaler? That brings up my clear next question, being a wholesale business owner myself and having a resellers permit/FEIN number would I be able to purchase a Rolex at wholesale from a distributor?

[GradyPhilpott]

I don't know the specifics, but I believe that all US authorized dealers get their watches from Rolex USA.

It's a more complicated story, which I'm sure someone will provide.

[Dashimmy]

For give me if I'm wrong but it goes from manufacturer to dealer.

[Patrick2278t]

I figured that was the case for an AD, but what about a typical watch dealer? I'm in Southern California and there are a plethora of non AD jewelry dealers who will get any Rolex for approximately 25% off retail. They all order the watch as you request it, and I assume since they aren't holding any inventory and are basically drop shipping they are willing to take that smaller margin for a guaranteed profit. I'm wondering who their supplier is.

[watches4me]

From the factory an invoice is sent directly to AD, cost is (-38%) period

Not (-40) that was taken back about 4 to 5 years ago..




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[Tools]

Originally Posted by Patrick2278t

. . . I'm wondering who their supplier is.

It's likely that their supplier varies and is an import/export that bypasses the Rolex USA distributor chain.

[gregmoeck]

They come over in large shipping containers

[enjoythemusic]

Patrick, many suppliers out there that offer 25% off. Basically, you can do this yourself and maybe even get 30% or more off. Visit the U.K. or some other country where the USD and that country' msrp benefits you, and provided they have it or can get it, figure a 15% discount on PM models, which is normal, then you get VAT back and there you go. Of course that means you have to do all the flying, haggling, etc. Thus for 30% or more, trusted sellers here have their own contacts and in the end offer you 25% off PM modeling you're in the market to buy a Rolex, I found that posting a WTB AD here to be great as trusted sellers bid on my business. This way you can get a really great deal as I did from a guy not mentioned as much here on TRF, yet his pricing was far better than the 'mainstream' trusted sellers here. :)

[Patrick2278t]

Originally Posted by enjoythemusic

Patrick, many suppliers out there that offer 25% off. Basically, you can do this yourself and maybe even get 30% or more off. Visit the U.K. or some other country where the USD and that country' msrp benefits you, and provided they have it or can get it, figure a 15% discount on PM models, which is normal, then you get VAT back and there you go. Of course that means you have to do all the flying, haggling, etc. Thus for 30% or more, trusted sellers here have their own contacts and in the end offer you 25% off PM modeling you're in the market to buy a Rolex, I found that posting a WTB AD here to be great as trusted sellers bid on my business. This way you can get a really great deal as I did from a guy not mentioned as much here on TRF, yet his pricing was far better than the 'mainstream' trusted sellers here. :)

That's an intriguing suggestion, I'm actually in the U.K. Fairly frequently for business. I believe I can get VAT back at heathrow. GBP is down so much it would probably be worth it. What's the typical bottom GBP price you've known a U.K. AD selling a DD40 for?

[AK797]

Originally Posted by Patrick2278t

That's an intriguing suggestion, I'm actually in the U.K. Fairly frequently for business. I believe I can get VAT back at heathrow. GBP is down so much it would probably be worth it. What's the typical bottom GBP price you've known a U.K. AD selling a DD40 for?

It's tougher now, even on PMs like DD40 you'll only get 10% off unless a really slow selling WG version in a small town, but if you buy here in dollars you'll do well on currency plus the VAT, I know some US trusteds who have come here, like rest of world, and picked up some deals.

[Patrick2278t]

Originally Posted by AK797

It's tougher now, even on PMs like DD40 you'll only get 10% off unless a really slow selling WG version in a small town, but if you buy here in dollars you'll do well on currency plus the VAT, I know some US trusteds who have come here, like rest of world, and picked up some deals.

What is the typical retail price you've seen on the DD40 in Pounds?

[Stealerfan86]

Originally Posted by AK797

It's tougher now, even on PMs like DD40 you'll only get 10% off unless a really slow selling WG version in a small town, but if you buy here in dollars you'll do well on currency plus the VAT, I know some US trusteds who have come here, like rest of world, and picked up some deals.

What about customs and duties?
While formula for duty is more complex, directional rule is the 3% of value


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[JP Chestnut]

Originally Posted by Dashimmy

For give me if I'm wrong but it goes from manufacturer to dealer.

RUSA isn't the manufacturer.

[ernie2]

There is so much you need to learn . Grasshopper.

[Patrick2278t]

Originally Posted by Stealerfan86

What about customs and duties?
While formula for duty is more complex, directional rule is the 3% of value


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Wouldn't be applicable. Buy the watch in U.K., get 20% VAT back at the airport and you're on your way. I wouldn't declare the watch.

[Tools]

Originally Posted by Patrick2278t

Wouldn't be applicable. Buy the watch in U.K., get 20% VAT back at the airport and you're on your way. I wouldn't declare the watch.

Then you would be breaking the law and subject to the penalties on top of the import duties.

[enjoythemusic]

I've heard that a special green stork delivers each Rolex after their born.

[MonBK]

Originally Posted by Patrick2278t

I'm looking into getting a DD40 and have secured one at $25.5K from a local dealer. However, I'm in the manufacturing / wholesale business myself which got me thinking... does anyone know how Rolex's supply chain works? Is it the typical manufacturer to distributor to retailer? I understand the average retail margin on Rolex is 40%, meaning a DD40 would be purchased by a retailer for approx $20.5K. Do they buy direct from the factory or is that from a wholesaler? That brings up my clear next question, being a wholesale business owner myself and having a resellers permit/FEIN number would I be able to purchase a Rolex at wholesale from a distributor?

Yes............................................... ................If you are an Authorized Rolex retailer.

How would you get 20% back when the VAT rate is 20% ?

[bodhipooh]

Originally Posted by Patrick2278t

Wouldn't be applicable. Buy the watch in U.K., get 20% VAT back at the airport and you're on your way. I wouldn't declare the watch.

Not at all accurate. VAT refund (if you could get ALL OF IT) would be 16.66% but if you are getting the VAT refund through Global Blue, GB Free, or Premium Tax Free, you are only going to get about 14% (maybe 15%) if the price is high enough.

If you want to avoid the entirety of the VAT, you have to hope that Watches of Switzerland has what you want in stock at one of their three boutiques at LHR.

[beshannon]

Originally Posted by Patrick2278t

I wouldn't declare the watch.

So you would be importing the watch illegally into the US.

As for your first question, why would Rolex bypass their own dealer network to sell you a watch just because you are a "wholesaler"?

[AK797]

Isn't import duty only a few percent into the States? I'd just declare that esp after the huge savings you will have made.

[watchwatcher]

^^ This. I'm all about a good deal on a Rolex, but not at the expense of violating the law.