The case for buying above MSRP

[Token74]

Originally Posted by S-F

You could, assuming the current economic climate stays exactly the same. What happens when more supply is released or the economy has a small hiccup?



Things aren't always so black and white :)

Supply and economic climate are both likely to stay the same for the 24 hours I mentioned


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[ragnk]

They look really nice

[Sal_UKSheffield]

Daytonas have always gone for a premium

Everything else is just a temporary phase imo

Only time will tell. If you have a boat load of cash you are more likely to pay over rrp

[SamP]

Originally Posted by Sal_UKSheffield

Daytonas have always gone for a premium

Everything else is just a temporary phase imo

Only time will tell. If you have a boat load of cash you are more likely to pay over rrp

Daytonas have not always been popular or gone for a premium.
Daytonas prior to 1988 were particularly bad sellers that sold for discount.
People didn’t want the gaudy dials of the now “Paul Newman” fame. They do now - because they’re rare, and only rare because not many were sold in the first place.
The “Zenith movement” Daytona of 1988 sold much better but were rare not due to demand, but due to lack of productivity. Zenith were making movements for many companies and could not supply as many as Rolex would have liked.
This demand (Originally due to factors out of Rolex’s hands) has continued ever since but is now due to Rolex.
If it weren’t for Zenith’s lack of movement supply, perhaps the Daytona wouldn’t have been in such demand - now perpetuated by Rolex.

[Mystro]

Originally Posted by SamP

Daytonas have not always been popular or gone for a premium.
Daytonas prior to 1988 were particularly bad sellers that sold for discount.
People didn’t want the gaudy dials of the now “Paul Newman” fame. They do now - because they’re rare, and only rare because not many were sold in the first place.
The “Zenith movement” Daytona of 1988 sold much better but were rare not due to demand, but due to lack of productivity. Zenith were making movements for many companies and could not supply as many as Rolex would have liked.
This demand (Originally due to factors out of Rolex’s hands) has continued ever since but is now due to Rolex.
If it weren’t for Zenith’s lack of movement supply, perhaps the Daytona wouldn’t have been in such demand - now perpetuated by Rolex.

I was in the market when you couldn’t give a Daytona away, especially a SS Daytona. Even in the early 90’s, no one wanted it and there wasn’t even a Rolex movement inside. The Daytona was viewed as a bit of a nerd in the catalog.

[The Argonaut]

Originally Posted by Sal_UKSheffield

Daytonas have always gone for a premium

Everything else is just a temporary phase imo

Only time will tell. If you have a boat load of cash you are more likely to pay over rrp

Interesting. That certainly seems to be the case with the Skydwellers, the blue dial version.


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[westcoastghost]

Seems like either OP is a gray dealer himself or does not understand economic cycles.

"If Rolex shortage is mostly due to increased demand, and more people than ever in the history of the world have the financial wherewithal to buy into such an aspirational brand -- whose reputation constantly ranks first -- the shortage might get worse, not better."

Talk to anyone who works in corporate debt, and look at Asian markets. There are massive red flags of a significant market correction (SHCOMP down 22% YTD). I was only in my first job out of undergrad in 2008, but I remember what watches were selling for on the pre-owned market.

[zengineer]

I think what we are doing here is known as rationalization.

Such an interesting thread topic even though they aren't intended to be about it.

It's no wonder there are 5 threads per week about it.

My favorites:

Life is short, you can't wait 6 months for that new bezel color.

Time is money, ....(actually, nothing that makes any sense ever follows this one)

They are underpriced at ADs, the grey sellers are the ones with it priced to the market so you should be happy paying market price.

[123Blueface]

Originally Posted by zengineer

I think what we are doing here is known as rationalization.

Such an interesting thread topic even though they aren't intended to be about it.

It's no wonder there are 5 threads per week about it.

My favorites:

Life is short, you can't 6 months for that new bezel color.

Time is money, ....(actually, nothing that makes any sense ever follows this one)

They are underpriced at ADs, the grey sellers are the ones with it priced to the market so you should be happy paying market price.

Perfect!
Amazing how the human mind can convince itself of anything.

[Fat_ninja]

The premium is basically the premium paid for time and access.


Most people dont have access unless they buy a lot of watches where the AD has made a lot of money on you.

So there is nothing wrong with paying a premium.

[77T]

Interesting approach - by taking MSRP and adding sales tax - then comparing it to inflated grey market prices for BNIB, you would feel that a 22,000 Daytona 500 is “only” 60%-ish over MSRP instead of 75%-ish over MSRP. If that slakes one’s lust and “FOMO misery index”, then good deal for them.

The only item I’d challenge is the state of play regarding online sellers and sales tax. In States that have enacted the tax again after the Supreme Court decision (and if the grey seller is in that State) then it is due from the seller. Whether they bother to collect it, or even report their sales, is up to them.

As for me, I will not pay the hyped price - but I don’t disrespect those who do.


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[brandrea]

If paying over MRSP for a watch works for some and they can obtain a reference they want through a gray for what is affordable to them, then to each their own.

My AD has always treated me fairly and that’s why I continue to support them

[ROLMARINER]

Originally Posted by brandrea

If paying over MRSP for a watch works for some and they can obtain a reference they want through a gray for what is affordable to them, then to each their own.

Thank you! We're not dumb and we're not justifying. It's just the way it is for the thousands of us without the AD relationship. The alternative is not getting the Rolex we want.

Originally Posted by brandrea

My AD has always treated me fairly and that’s why I continue to support them

And that's great, and I wish it were that way for me but despite the fact that I own 8 very nice Rolexes some were bought via private sellers, some are vintage references, and my new models were in such high demand there were none for me to purchase. So while I certainly have a Rolex collection worthy enough to be deemed a 'whale' in any reasonable dealers eyes, I'm unimportant to local AD's because I didn't buy any of the 8 from them.

If I had an AD that could tell me with a straight face that they'd get me a Daytona or a Pepsi within 6 months I'd have bought one from them, I think any rational person would.

[brandrea]

Originally Posted by ROLMARINER

Thank you! We're not dumb and we're not justifying. It's just the way it is for the thousands of us without the AD relationship. The alternative is not getting the Rolex we want.



And that's great, and I wish it were that way for me but despite the fact that I own 8 very nice Rolexes some were bought via private sellers, some are vintage references, and my new models were in such high demand there were none for me to purchase. So while I certainly have a Rolex collection worthy enough to be deemed a 'whale' in any reasonable dealers eyes, I'm unimportant to local AD's because I didn't buy any of the 8 from them.

If I had an AD that could tell me with a straight face that they'd get me a Daytona or a Pepsi within 6 months I'd have bought one from them, I think any rational person would.

Not sure what part of my post implied you were dumb or justifying ...

I’m simply saying if you prefer to buy gray vs AD and pay the price, to each their own

[ROLMARINER]

Originally Posted by brandrea

Not sure what part of my post implied you were dumb or justifying ...

I’m simply saying if you prefer to buy gray vs AD and pay the price, to each their own

Not you brandrea, others who were implying that.

I agree completely with you- if one is passionate about Rolex it shouldn't matter if someone got a deal at 20% off or someone paid a 20% premium. It's all about the wrist and the watch and our appreciation of this outstanding brand.

[brandrea]

Originally Posted by ROLMARINER

Not you brandrea, others who were implying that.

I agree completely with you- if one is passionate about Rolex it shouldn't matter if someone got a deal at 20% off or someone paid a 20% premium. It's all about the wrist and the watch and our appreciation of this outstanding brand.

agreed.

[ROLEXster]

Is overpaying MSRP bad ?
OR force to buy PM DDs / PM Daytonas at MSRP to get on a phantom list.

[superpop]

People with money they have acquired on their own typically do not pay MSRP or over for anything. Anything. Especially not a mass produced object. And more importantly a fashion item. Face it, that's what a watch is, like a pair of designer jeans. I will wait patiently and enjoy the watches I do have and then in a year or two when the market has changed, I will go into an AD and get what I want at a discount. Or I wont, but something tells me that the bubble is about to pop here. I am old enough to remember several economic cycles and luxury items always get slammed the hardest in a downturn.

[ROLEXster]

Originally Posted by superpop

People with money they have acquired on their own typically do not pay MSRP or over for anything. Anything.

So if AD offers you a 500C / BLRO for $1 over MSRP ...
You will not buy it base on principle ?

[pinkelle21]

It was more of a joke, don't read into too much. I typically don't like to pay a premium on an already expensive item, so that it doesnt reinforce this crazy behavior of AD's or grey's jacking up prices for people that have to have it now. Just for the record I don't think you personally are stupid, it's your money

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[904VT]

Originally Posted by askdanny

Obviously, the ideal Rolex steel-sports purchase is at a duty-free Rolex AD -- at the airport for example. But legally you should be declaring the purchase as you go through customs in your country anyway. (And the odds that the watch is available as you make your way through the airport are slim.)

So realistically, you buy at a local AD where you'll pay full price plus sales tax. In many big cities like Chicago, New York, or Los Angeles, you'll pay close to 10% in sales tax. In many countries in Europe, we're talking 20%. On a Hulk, Daytona, or Pepsi this is big money.

There is no telling when the watch will be available at your AD, and what the sales tax or MSRP will be at when the watch is available, as waiting lists are not made public. The only thing you know is that there will be no discount. With time, MSRP and sales tax are likely to go up, not down. Sales taxes are less unpopular than property taxes because it is a consumer tax. Americans are often cash-poor but land-rich. So sales taxes are more likely to be approved or voted on to bolster state coffers. Rolex MSRP can only go up, as I believe Rolex steel-sports models are currently underpriced; I believe the new movements will be the justification for the price increase.

Online grey dealers are not currently under the obligation to charge sales tax. This might soon change as Internet sales taxes are falling under more scrutiny because brick-and-mortars complain they can't compete. I predict online sellers in all industries will be made responsible for charging sales tax at checkout. Currently online grey dealers will offer no sales tax and free overnight shipping. (I'm not a grey dealer, just a Rolex lover.)

If Rolex shortage is mostly due to increased demand, and more people than ever in the history of the world have the financial wherewithal to buy into such an aspirational brand -- whose reputation constantly ranks first -- the shortage might get worse, not better. I heard Rolex is increasing output, but I don't think we've seen the peak demand yet -- and demand will continue to outpace supply.

Do you want to wait one or two more years for that hard-to-get Rolex and roll the dice to save $500, $1000 or even $2000 depending on the model? MSRP and sales tax are both such unknown variables that paying "grey prices" now can make sense. Plus, in two years, who knows what the market value will be. The Daytona didn't jump straight from $12,000 to $22,000. But it has relentlessly gone up and is standing at $22,000 now.

So go buy that Hulk or BLNR and enjoy them now!

I would say new movements would've been a good excuse to increase prices, but that boat has sailed. The 126660, ~same. The 126710BLRO, ~same. 126600, cyclops driven price increase.

Regardless the SS watches have room to move up in MSRP imo

[dubins930]

Mass produced stainless steel sport watch isn’t a value at msrp... let alone double the price... we’ve already seen BLRO prices come down... no one can say if the price will level out or eventually drop as they become more available when Rolex catches up with demand.
Some of the posts on this thread are painful to read

[Justinmg]

Originally Posted by dubins930

Mass produced stainless steel sport watch isn’t a value at msrp... let alone double the price... we’ve already seen BLRO prices come down... no one can say if the price will level out or eventually drop as they become more available when Rolex catches up with demand.
Some of the posts on this thread are painful to read

This

[askdanny]

Originally Posted by dubins930

Mass produced stainless steel sport watch isn’t a value at msrp... let alone double the price... we’ve already seen BLRO prices come down... no one can say if the price will level out or eventually drop as they become more available when Rolex catches up with demand.

Some of the posts on this thread are painful to read

The price of the BLRO came down because it started at more than double MSRP for a watch that was released just months ago. To say “we’ve already seen BLRO prices come down” is true but misleading. The premium on that watch is still higher currently than the premium paid for a BLNR or Hulk.


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[123Blueface]

Originally Posted by askdanny

The price of the BLRO came down because it started at more than double MSRP for a watch that was released just months ago. To say “we’ve already seen BLRO prices come down” is true but misleading. The premium on that watch is still higher currently than the premium paid for a BLNR or Hulk.


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.....and what’s truly sad is that although I love mine and am glad I have it, it truly doesn’t hold any different place in my heart or rotation than any of my other watches. If I didn’t have it, my life would be the same.
It’s just that, a watch.
Didn’t change my life in the slightest bit to own it. In fact, I am poorer as result and my financial advisor was pissed as can’t understand when enough watches is enough.
So I can say I have it, big deal. Won’t put food on my table.

My point, we as WIS have got to recognize the aforementioned and stop feeding the frenzy.

[dubins930]

Originally Posted by askdanny

The price of the BLRO came down because it started at more than double MSRP for a watch that was released just months ago. To say “we’ve already seen BLRO prices come down” is true but misleading. The premium on that watch is still higher currently than the premium paid for a BLNR or Hulk.


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It isn’t misleading... the price has come down! More have been produced and purchased, more widely available from greys... price comes down. Hulk and BLNR have been out for years, there are far more of them in existence why wouldn’t they have a lower premium? The BLRO isn’t going to stay at 18k as it becomes more available.

[Mystro]

Originally Posted by dubins930

It isn’t misleading... the price has come down! More have been produced and purchased, more widely available from greys... price comes down. Hulk and BLNR have been put for years, there are far more of them in existence why wouldn’t they have a lower premium? The BLRO isn’t going to stay at 18k as it becomes more available.

In comparison, the Hulk is 8 years old. It’s been out so long that the amount of inventory of this watch has to be significant yet it’s a $12.5 true market watch. The Hulk has hit its ceiling at $12.5. There is nothing magical about the Daytona and it holds its current price point. New hot models probably will hold a +3-5k premium over msrp for a long long time.

[dubins930]

Originally Posted by Mystro

In comparison, the Hulk is 8 years old. It’s been out so long that the amount of inventory of this watch has to be significant yet it’s a $12.5 true market watch. The Hulk has hit its ceiling at $12.5. There is nothing magical about the Daytona and it holds its current price point. New hot models probably will hold a +3-5k premium over msrp for a long long time.

Yeah it will more than likely hold a premium, but the price will come down as more of them enter the market.. I don’t know what that price will be... but it won’t be the 18k+ it entered at, as it has come
down.

[ROLMARINER]

Originally Posted by dubins930

The BLRO isn’t going to stay at 18k as it becomes more available.

Who says the BLRO is going to become more available?

If I were Rolex, I'd learn from the amazing frenzy around the Daytona and create a similar unicorn that has far greater appeal to a far larger audience. The Daytona is off-putting to some with its price and its size and its niche complication. Pick another reference that is more popular, do the same thing on steroids.

Creating that 10 year waiting list and positive press by targeting a more affordable watch that every Submariner owner would find appealing, the GMT makes a lot of sense if they were going down this path. And with 9 different configurations available, you're not going to hurt sales in that model by making a hard-to-find one-off. Reaching back to the iconic Pepsi and tricking it out with a unique bezel and bracelet combination feels like a pre-planned marketing opportunity to me, and not a way to sell more GMT's. They already were selling enough. By releasing BLRO's with an eyedropper they can keep the social and traditional media buzz from the Daytona continuing for years to come.

[dubins930]

Originally Posted by ROLMARINER

Who says the BLRO is going to become more available?

Because it is more available... more inc threads, more on grey sites... it’s not really a debate. It is already more available than from the first watch sold.