Rolex ADs don't hold onto their watches. They sell them.

[jb335]

Yeah, I'm confused by the subject line and the content of the post.

Also, just in general, just because an AD tells you something, that doesn't mean it's factual.

Sales people across all product types feel the need to appear informed and will either just make an answer up because they don't want to seem unknowledgeable or are relying on bad information passed on to them.

[jb335]

Originally Posted by kauffee

I think we can file this thread into the "My AD told me..." bin.

x 10000

[zengineer]

I think the message is that there is a warehouse near Area 51 full of Daytona with no springs.

[GB-man]

Haha

[henry333]

Money can fix everything for Rolex.. and Rolex has a lot of it

[Devildog]

Originally Posted by AK797

Brexit caused a mad rush in demand not the supply collapse of hairsprings.

Agreed. And not just Brexit.

My AD has has a great year. Their issue is demand. Not supply.

If more people want a product produced in set volumes that product will be harder to aquire. It’s not rocket science.

[DARK_KNIGHT]

Originally Posted by AznD85

wanted to hear everyone's thoughts about this and it does not make sense to me.

I want to thank you for sharing the senseless information. It didn't make sense to you and I concur.

What is the name of the AD? I want to avoid setting foot inside , least I be "enlightened" .

[VicLeChic]

I think most ADs hold on to the hot models and they're the main reason for the so called "scarcity".

[Andad]

I think most ADs hold on to the hot models and they're the main reason for the so called "scarcity".

Why would they do this?

Can't see this strategy as a blueprint for success?

[Andad]

Originally Posted by mulgogy

Rolex is also a charitable trust and doesnt need to do anything to meet a temporary demand in product when the brand has never been stronger. I would say they are exactly where they want to be.

Originally Posted by replicator

Rolex is owned by a private trust.

No need to make quarterley earnings or flood the market for short term gains. Their brand value is higher than ever.

I see this posted quite often.

Rolex may be charitable but they have huge salary outgoings, capital expenditure on equipment maintenance and upgrades, research and development costs, advertising, sponsorships etc. etc. etc.

If their expenditure is more than income from their sales they will fail like any other Company.

[tyler1980]

Originally Posted by AznD85

Rolex has been struggling to make these parts with the Nivarox machine and thus supply has been low or slow due to difficulty making these essential parts.

i highly doubt they cant figure out how to make essential parts.

[tyler1980]

Originally Posted by directioneng

I see this posted quite often.

Rolex may be charitable but they have huge salary outgoings, capital expenditure on equipment maintenance and upgrades, research and development costs, advertising, sponsorships etc. etc. etc.

If their expenditure is more than income from their sales they will fail like any other Company.

they dont have shareholders to keep happy (or to return profits to) as the trust owns all the shares so thats the main difference. Its not like a public company who has an obligation to maximize profit which often times leads to short term money grabs which erodes the long term brand value. Rolex can play the long game and most other companies cant.

For example, some of the big oil companies are spending billions of dollars this year to buy back shares and boost their share price. That money could be used for a ton of other things related to operations or salaries or exploration, but it isnt. Rolex would never have to do this.

[brandrea]

Originally Posted by directioneng

I see this posted quite often.

Rolex may be charitable but they have huge salary outgoings, capital expenditure on equipment maintenance and upgrades, research and development costs, advertising, sponsorships etc. etc. etc.

If their expenditure is more than income from their sales they will fail like any other Company.

Have to agree. Profit is what motivates and Rolex knows how to turn one.

[beshannon]

Originally Posted by AznD85

Admittedly

I stopped by my local AD and we had a very interesting conversation that I wanted to share with you all hence the subject line above.

So you listened to their speculation?

Thanks.

[rambo99]

Originally Posted by AK797

Brexit caused a mad rush in demand not the supply collapse of hairsprings.

i doubt it. why brexit would cause a rush in demand?

[tyler1980]

Originally Posted by rambo99

i doubt it. why brexit would cause a rush in demand?

Because watches were cheap for anyone not paying in GBP... it’s still cheaper today. My BLRO (including a 20% VAT) was less than 9k USD which is over 1,000 USD less than US retail + sales tax and the pound has recovered significantly in the past two years. It was a downright fire sale for a while.

I’m buying all my watches in the UK as it’s a discount. If i got a VAT return its a $7500 watch

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[challer]

Nivarox is owned by Swatch - no surprise bought the machine and brought the manufacturing in house.

[padi56]

Originally Posted by AznD85

Admittedly I don't post here often but I do follow some threads and read online about Rolex watches.

I stopped by my local AD and we had a very interesting conversation that I wanted to share with you all hence the subject line above.

I am sharing my conversation with him and wanted to hear everyone's thoughts about this and it does make sense to me.

Nivarox is the maker of metallic alloys for hairsprings and mainsprings for the movement of the time piece. Nivarox used to make these parts for Rolex but Rolex bought the machine from Nivarox to bring it all "IN HOUSE" movement.

Rolex has been struggling to make these parts with the Nivarox machine and thus supply has been low or slow due to difficulty making these essential parts.

For Rolex to make their watches scarce starting with the famous Daytona then now some of the other ones like the Submariner is crazy. A business should find ways to ramp of their production when demand is high and if it doesn't meet the demand then their profits will be capped by production. It is not like Rolex ADs can sell their scarce sought after Rolex models for more. We all know ADs cannot do that. Therefore again, profits for Rolex and ADs are capped by Rolex production. This seems to make sense for me that Rolex has trouble producing their time pieces in terms of their movements.

What are you thoughts guys?

(I apologize if this was previously brought up before on another thread. If not, this may enlighten us all!)

Complete and utter nonsense Nivarox is just the name for the metal used to make hairsprings much like Rolex call Parachrom the metal they now use.The first Rolex watch to get the in-house parachrom was the cal 4130 in the Daytona way back in 2000.Nivarox hairsprings are part of the Swatch group and nothing whatsoever to do with machines, Nivarox is just the name of the metal alloy much like Rolex calls there own Parachrom.Today it is used mainly in the watch/clock industry, but also in other micro-machine industries and in certain types of medical equipment and high precision surgical instruments. There are several variations of the Nivarox alloy depending upon the intended application. These alloys are stainless steel alloys with high concentrations of Cobalt (42-48%), Nickel (15-25%) and Chromium (16-22%). There are also small amounts of titanium and beryllium. Hairsprings made of this alloy are highly wear-resistant,and they are practically non-magnetic in normal wearing,and non-rusting and possess a low coefficient of thermal expansion.

Nivarox 1 through 5 is a series of grades of hairsprings with number 1 being the best quality. The most commonly encountered Nivarox hairsprings in the watch industry are grades 1 to 3. The alloy is unaffected by heat and normal everyday ordinary magnetic fields. There is however, also the Anachron hairspring which is said to be of even higher quality than the Nivarox No 1 grade.Who knows perhaps that the grade that Rolex used over the past 40 odd years before introduction of the parachrom all round.

[LuminousMaximus]

thank you padi for a detailed and informed answer...

[AznD85]

Originally Posted by padi56

Complete and utter nonsense Nivarox is just the name for the metal used to make hairsprings much like Rolex call Parachrom the metal they now use.The first Rolex watch to get the in-house parachrom was the cal 4130 in the Daytona way back in 2000.Nivarox hairsprings are part of the Swatch group and nothing whatsoever to do with machines, Nivarox is just the name of the metal alloy much like Rolex calls there own Parachrom.Today it is used mainly in the watch/clock industry, but also in other micro-machine industries and in certain types of medical equipment and high precision surgical instruments. There are several variations of the Nivarox alloy depending upon the intended application. These alloys are stainless steel alloys with high concentrations of Cobalt (42-48%), Nickel (15-25%) and Chromium (16-22%). There are also small amounts of titanium and beryllium. Hairsprings made of this alloy are highly wear-resistant,and they are practically non-magnetic in normal wearing,and non-rusting and possess a low coefficient of thermal expansion.

Nivarox 1 through 5 is a series of grades of hairsprings with number 1 being the best quality. The most commonly encountered Nivarox hairsprings in the watch industry are grades 1 to 3. The alloy is unaffected by heat and normal everyday ordinary magnetic fields. There is however, also the Anachron hairspring which is said to be of even higher quality than the Nivarox No 1 grade.Who knows perhaps that the grade that Rolex used over the past 40 odd years before introduction of the parachrom all round.

Thanks for informing us.


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[77T]

Originally Posted by padi56

Complete and utter nonsense Nivarox is just the name for the metal used to make hairsprings much like Rolex call Parachrom the metal they now use.The first Rolex watch to get the in-house parachrom was the cal 4130 in the Daytona way back in 2000.Nivarox hairsprings are part of the Swatch group and nothing whatsoever to do with machines, Nivarox is just the name of the metal alloy much like Rolex calls there own Parachrom.Today it is used mainly in the watch/clock industry, but also in other micro-machine industries and in certain types of medical equipment and high precision surgical instruments. There are several variations of the Nivarox alloy depending upon the intended application. These alloys are stainless steel alloys with high concentrations of Cobalt (42-48%), Nickel (15-25%) and Chromium (16-22%). There are also small amounts of titanium and beryllium. Hairsprings made of this alloy are highly wear-resistant,and they are practically non-magnetic in normal wearing,and non-rusting and possess a low coefficient of thermal expansion.

Nivarox 1 through 5 is a series of grades of hairsprings with number 1 being the best quality. The most commonly encountered Nivarox hairsprings in the watch industry are grades 1 to 3. The alloy is unaffected by heat and normal everyday ordinary magnetic fields. There is however, also the Anachron hairspring which is said to be of even higher quality than the Nivarox No 1 grade.Who knows perhaps that the grade that Rolex used over the past 40 odd years before introduction of the parachrom all round.

Peter - all factually correct but misses the OP’s questions.

Do you think Rolex could be experiencing some problems fabricating their own hairspring alloy in-house?

Thusly constraining the supply chain for movement production?

Thereby reducing availability because overall watch production dropped?

As for me, I say bollocks for a different reason - this theory would constrain all model production, not just the SS models. Methinks that AD is grasping for straws to explain their sparsely populated Rolex display case.


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[padi56]

Originally Posted by 77T

Peter - all factually correct but misses the OP’s questions.

Do you think Rolex could be experiencing some problems fabricating their own hairspring alloy in-house?

Thusly constraining the supply chain for movement production?

Thereby reducing availability because overall watch production dropped?

As for me, I say bollocks for a different reason - this theory would constrain all model production, not just the SS models. Methinks that AD is grasping for straws to explain their sparsely populated Rolex display case.


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Any manufacturing firm could experience problems with manufacture any part, but IMHO not the case this time with Rolex hairsprings no matter the name, and the OP information most probably came from AD fantasy island.

Fact Nivarox is not a machine as the OP stated its the name of a metal alloy.

[tyler1980]

Originally Posted by 77T

Peter - all factually correct but misses the OP’s questions.

Do you think Rolex could be experiencing some problems fabricating their own hairspring alloy in-house?

Thusly constraining the supply chain for movement production?

Thereby reducing availability because overall watch production dropped?

As for me, I say bollocks for a different reason - this theory would constrain all model production, not just the SS models. Methinks that AD is grasping for straws to explain their sparsely populated Rolex display case.


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IMO all this "they dont know what they are doing" stuff is being used in a lot of other areas. They cant get the colors right, so they just launched a new watch with the best they could do. They cant make parts. They didn't understand that certain watches would be popular so they underproduced by accident.

It makes me think the perception is they are making watches flying by the seat of their pants.

[BVLDARI]

I was once told that they only have one person making the two tone ceramic bezels so that's why they are so hard to get...

[RHJ]

Originally Posted by mulgogy

Rolex is also a charitable trust and doesnt need to do anything to meet a temporary demand in product when the brand has never been stronger. I would say they are exactly where they want to be.

Exactly! Seems that nobody wants to understand, that Rolex isn't a normal profit oriented company .... This changes everything.

[77T]

Originally Posted by padi56

Any manufacturing firm could experience problems with manufacture any part, but IMHO not the case this time with Rolex hairsprings no matter the name, and the OP information most probably came from AD fantasy island.

Fact Nivarox is not a machine as the OP stated its the name of a metal alloy.

I certainly agree Nivarox is not a machine - that is an entirely superfluous mistake in the AD’s story or the OP’s perception of the story.

The story is preposterous on the face of it. But would you agree with my conclusion - that even IF such a thing was true it would affect all models, not just the SS ones which people continue to believe are being constrained?

Originally Posted by tyler1980

IMO all this "they dont know what they are doing" stuff is being used in a lot of other areas. They cant get the colors right, so they just launched a new watch with the best they could do. They cant make parts. They didn't understand that certain watches would be popular so they underproduced by accident.

It makes me think the perception is they are making watches flying by the seat of their pants.

I agree. Rolex didn’t just start making watches yesterday. They experiment and do extensive testing of any new component, color, material or alloy well before introduction. That includes the fabrication impacts and supply chain integration.



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[2nastie]

OP's subject line is completely off vs. the post.

Either way, yes I know for a fact an AD holds stock back of certain models. Most of the time as inducements for Purchasers to buy "less desirable" models first. However, ADs are also pretty smart as they can not hold that particular watch for that long. Rolex does keep track on which inventory goes to which AD and gets sold. If the watch isn't registered at some point, the AD won't be shipped another one of that particular model (especially with a SS sports watch). Theoretically they can't just hold a bunch of Daytonas and BLRO as Rolex won't ship them another one until its "sold".

[05carbondrz]

Originally Posted by 2nastie

OP's subject line is completely off vs. the post.

Either way, yes I know for a fact an AD holds stock back of certain models. Most of the time as inducements for Purchasers to buy "less desirable" models first. However, ADs are also pretty smart as they can not hold that particular watch for that long. Rolex does keep track on which inventory goes to which AD and gets sold. If the watch isn't registered at some point, the AD won't be shipped another one of that particular model (especially with a SS sports watch). Theoretically they can't just hold a bunch of Daytonas and BLRO as Rolex won't ship them another one until its "sold".

That’s why they just “sell” it to Family Members/Friends who flip on the Grey Market for them.With up to 10K of extra profit on each Watch you’d be a Fool to think this isn’t happening Daily.

[2nastie]

Originally Posted by 05carbondrz

That’s why they just “sell” it to Family Members/Friends who flip on the Grey Market for them.With up to 10K of extra profit on each Watch you’d be a Fool to think this isn’t happening Daily.

I don't see how your comment relates to my post. Aren't we tackling the question of whether or not ADs hold stock and not if they flip to another source to capture more profit.

I'm sure certain ADs do what you suggested. There probably isn't any debate about that. But the fact is they do hold inventory in their safe for whatever reasons they choose. But as a business plan they still have to move it in whatever means they decide in order to free up space to get another one. They can't hoard of bunch of Daytonas. The watch has to sell and once it's sold regardless of what the intentions are, it is out the door and thus not held back.

[05carbondrz]

Originally Posted by 2nastie

I don't see how your comment relates to my post. Aren't we tackling the question of whether or not ADs hold stock and not if they flip to another source to capture more profit.

I'm sure certain ADs do what you suggested. There probably isn't any debate about that. But the fact is they do hold inventory in their safe for whatever reasons they choose. But as a business plan they still have to move it in whatever means they decide in order to free up space to get another one. They can't hoard of bunch of Daytonas. The watch has to sell and once it's sold regardless of what the intentions are, it is out the door and thus not held back.

I was simply explaining a way around your theory of “they have to be sold sometime”.When there is this much free $$ on the Table People get REALLY creative.