Rolex Dumping their AD's?

[Cavester]

There seems to be a consensus between some that Rolex are dumping their AD's to bring sales in house.

What are people's opinions on here of this, truth or slander?

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[-Ally-]

Consensus between some?

Nonsense.

[Cavester]

Originally Posted by -Ally-

Consensus between some?

Yes, I've heard of various people now commenting on this due to "leaks" coming out of Rolex.

Just trying to understand how much of a consensus people think this is.

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[Kevin of Larchmont]

Originally Posted by Cavester

Yes, I've heard of various people now commenting on this due to "leaks" coming out of Rolex.

Just trying to understand how much of a consensus people think this is.

“Many people are saying….” Yeah no, never gonna happen. The illusion of exclusivity is reinforced by ADs and their empty cases. Retail is an entirely different business than manufacturing and marketing and Rolex has no interest in upending their entire business model especially when they are destroying their competitors with it. Sure, Rolex is cleaning house and tightening their distribution but this is to better control that distribution, not to eliminate it.

This is all my opinion of course based on life experience beyond watches. Of course I can’t prove or support it but I know it.

[GW44]

Originally Posted by Cavester

Yes, I've heard of various people now commenting on this due to "leaks" coming out of Rolex.

Just trying to understand how much of a consensus people think this is.

Sent from my SM-G991B using Tapatalk

Remember what Winston Churchill once said…..”don’t believe everything you read on the internet…”

[ChipotleBanana]

Originally Posted by Cavester

There seems to be a consensus between some that Rolex are dumping their AD's to bring sales in house.

What are people's opinions on here of this, truth or slander?

Sent from my SM-G991B using Tapatalk

Rolex will not dump all of their AD's. Many of these retailers are directly responsible for the success that the brand has had. Rolex does NOT partake in the retail side of their business whatsoever.

[GB-man]

They’d be better for it but it would be cold blooded and would require a lot of work. Depends how ambitious the CEO is. My guess is they don’t do that but rather cull the herd.

[SDGT3]

I could see it happening in order to control rogue dealers who are selling out the back door. One could make the argument that this environment has helped Rolex, but it's simply not sustainable and better to get out in front of it and control distribution directly than experience the alternative.

[RolexSimon]

Originally Posted by SDGT3

I could see it happening in order to control rogue dealers who are selling out the back door. One could make the argument that this environment has helped Rolex, but it's simply not sustainable and better to get out in front of it and control distribution directly than experience the alternative.

Agree - Rolex is trying to get a handle on this. Perhaps ADs they aren't 100% sure about are in the firing line. As big multiple-franchise dealers have so much more to loose, perhaps Rolex feels they can apply the pressure to them a bit more (stopping sales to known flippers, releasing data on individuals and watch purchases etc.). See it happening with Rolex (only in some countries I accept) wanting a form filled out with individuals' name / occupation and purchase history for allocation of top-end watches now.

[whiskyrolex]

Originally Posted by RolexSimon

releasing data on individuals and watch purchases etc.).

Highly doubtful as it would would violate privacy laws in many of the regions Rolex operates in.

[UK AP]

Rolex are wholesalers, who sell their products through retailers, I don’t see that changing any time soon, they may however going forward be more particular with whom they partner.

[RolexSimon]

Originally Posted by whiskyrolex

Highly doubtful as it would would violate privacy laws in many of the regions Rolex operates in.

I accept this is a legal issue. I'd imagine there may be some way of doing this for warranty registration? Also, if you want a particular top end watch and by agreeing for your details to be provided to Rolex is the only way to even be considered, I suppose it's a personal choice whether you want that Meteorite Daytona or not.......
Rolex has tried the warranty withholding method before, but failed due to legal requirements, I'd imagine they're trying to close the holes by other methods now......Getting rid of dodgy ADs might be one of them.

[SDR581]

Originally Posted by Cavester

There seems to be a consensus between some that Rolex are dumping their AD's to bring sales in house.

What are people's opinions on here of this, truth or slander?

Sent from my SM-G991B using Tapatalk

Rolex is definitely trimming down and consolidating ADs to have a more streamlined logistics due to the high demand. However, I think some of the rumors are due to some YouTube channels pushing this theory (Paul Thorpe).

Nothing he has said has ever come to term.

[WatchGuy1966]

Originally Posted by SDR581

(Paul Thorpe).

Nothing he has said has ever come to term.

^^^ this^^^

He's nothing but click-bait

[vh2k]

Originally Posted by SDR581

I think some of the rumors are due to some YouTube channels pushing this theory (Paul Thorpe).

Nothing he has said has ever come to term.

Originally Posted by WatchGuy1966

^^^ this^^^

He's nothing but click-bait

He has ZERO credible sources and is consistently wrong more than any other watch industry prognosticator.

ROLEX IS NOT GOING DIRECT. PERIOD!

[grimps]

Originally Posted by SDR581

Rolex is definitely trimming down and consolidating ADs to have a more streamlined logistics due to the high demand. However, I think some of the rumors are due to some YouTube channels pushing this theory (Paul Thorpe).

Nothing he has said has ever come to term.

Paul Thorpe is no lover of AD's , he's just trying to stir the pot a little as his mates aren't able to get their usual supply like the old days

[mbalmz]

Originally Posted by Cavester

There seems to be a consensus between some that Rolex are dumping their AD's to bring sales in house.

What are people's opinions on here of this, truth or slander?

Sent from my SM-G991B using Tapatalk

They do seem to be actively opening more "rolex boutiques", but in the US the "boutiques" are all run by large ADs (wempe, watches of switzerland, etc).

If your point is that they’re moving to boutiques only vs multi-brand stores, I could see that being the plan long term.

If you literally mean Rolex exclusively running their own retail (a la Apple) and not using the AD brand names at all, there is zero chance of this.

[absoluteczech]

If you think Rolex doing direct to consumer would benefit distribution and supply you'll be sorely mistaken. It will be scalped by the individuals online using bots, etc. I for one hope that they don't go down that road

[Laszlo]

I am ignorant to the insides of how the watch world functions, but as an outsider, or an outside-in perspective, other major luxury brands changed their business strategy and models many years ago and sell exclusively online and through their own stores. 80% of luxury customers prefer online discovery, purchase, and/or drivers to the brand store. Who really wants to go to a jewelry store (AD) anymore and beg for a watch or have to establish a relationship? Really? That's crazy old school and borderline mafia tactics. It might work for customers who've been conditioned to this over the past 20-years, but the young money won't buy into that at all. It's a turn off for them. This Rolex model doesn't cut it in today's luxury good commerce. The current Rolex model is dated and old fashioned. It's time to evolve like everyone else has and I believe they're very much engaged in this strategy and change now.

[WatchGuy1966]

Originally Posted by Laszlo

borderline mafia tactics.

This is where I abandon reading your post and toss it all out as hyperbole

[Laszlo]

Originally Posted by WatchGuy1966

This is where I abandon reading your post and toss it all out as hyperbole

They’re strong arm tactics, ‘If you buy this or two of those we’ll give you that.’

It’s just sleazy.

That stuff turns a lot of people off.

Imagine if Chanel did this? Or LV?

Anyway, this is just my opinion and it just rubs me the wrong way.

These are old school tactics and not welcome in modern business.

[teck21]

Originally Posted by Laszlo

They’re strong arm tactics, ‘If you buy this or two of those we’ll give you that.’

It’s just sleazy.

That stuff turns a lot of people off.

Imagine if Chanel did this? Or LV?

Anyway, this is just my opinion and it just rubs me the wrong way.

These are old school tactics and not welcome in modern business.

Do you have any suggestions to ADs on how to maximise profit without doing this since they are not able to sell at above msrp?

Or perhaps you think they should not be allowed to make more money?


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[Laszlo]

Originally Posted by teck21

Do you have any suggestions to ADs on how to maximise profit without doing this since they are not able to sell at above msrp?

Or perhaps you think they should not be allowed to make more money?


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This way of business by ADs has been going on for decades and has nothing to do with the current climate.

If an AD needs to resort to these tactics to stay in business then it’s a broken business model.

I would think that’s a sensible thing to say.

[Puppysmasher]

Rolex boutiques are still privately owned, they just only sell exclusively Rolex. From what I've seen here in the Bay Area Rolex has culled some smaller time family ADs and switched others at more prime locations (major malls in cities) to Rolex exclusive boutiques. It looks like Rolex wants to upgrade to more upscale locations and floorplan for their ADs. I remember being shocked by how small time some of their previous ADs were when I first visited one a few years ago. It definitely was a stark contrast to the brands marketed prestige so I can see why Rolex is making the change now.

This shouldn't be confused with boutiques like Omega whom are owned and operated by Omega itself.

[Wine4Golf]

Originally Posted by Laszlo

I am ignorant to the insides of how the watch world functions, but as an outsider, or an outside-in perspective, other major luxury brands changed their business strategy and models many years ago and sell exclusively online and through their own stores. 80% of luxury customers prefer online discovery, purchase, and/or drivers to the brand store. Who really wants to go to a jewelry store (AD) anymore and beg for a watch or have to establish a relationship? Really? That's crazy old school and borderline mafia tactics. It might work for customers who've been conditioned to this over the past 20-years, but the young money won't buy into that at all. It's a turn off for them. This Rolex model doesn't cut it in today's luxury good commerce. The current Rolex model is dated and old fashioned. It's time to evolve like everyone else has and I believe they're very much engaged in this strategy and change now.

Definitely agree with what you’re saying. This beg for a watch nonsense is not sustainable. Young people want no part of this.

[JPARICE]

My humble opinion I believe this is history repeating itself based on the strong demand in China and Southeast Asia it appears Rolex will shift some of their resources there. It is common knowledge that Rolex only produce and are only able to produce about 900,000 watches a year. But there's nothing to dictate what kind of watch are to be manufacture, in my humble opinion they will manufacture high value watches and send to South East Asia.

[dannyp]

To paraphrase William H. Macy in Wag The Dog:

Rolex know's two things to be true: Owning one of the world's most coveted trademarks and being the sole producer of products bearing it is awesome, and being in retail sucks.

[Chiboy]

Originally Posted by dannyp

To paraphrase William H. Macy in Wag The Dog:

Rolex know's two things to be true: Owning one of the world's most coveted trademarks and being the sole producer of products bearing it is awesome, and being in retail sucks.

Being in Rolex retail sure doesn't suck these days. They have lines for virtually everything, so all they have to do to make a 4 or 5 digit margin is call the next in line. As if that wasn't enough, the retailers can even leverage that more by requiring customers to buy some non-Rolex stuff in order to get that call.

The downside? They have to waste a bunch of retail square footage on empty, Rolex-ordered and sold display cases.

[dannyp]

Originally Posted by Chiboy

Being in Rolex retail sure doesn't suck these days. They have lines for virtually everything, so all they have to do to make a 4 or 5 digit margin is call the next in line. As if that wasn't enough, the retailers can even leverage that more by requiring customers to buy some non-Rolex stuff in order to get that call.

The downside? They have to waste a bunch of retail square footage on empty, Rolex-ordered and sold display cases.

There’s a difference between “it doesn’t suck to be in retail” and “it doesn’t suck to have the Rolex line if you’re in retail”

It still sucks to be in retail, some retail just sucks less.

[misterpeanut]

I welcome the change as distribution will be more straightforward, but this doesn't mean watches will become cheaper or more available, especially for average joes like us. It will likely be similar to the distribution for Hermes and Birkin bags. Still some gray selling but they have more control, and waitlists will still be a thing.

Those who say "But but it's so profitable now!! Why would they change?!?!!" are missing the mark. They are getting 60% of a $9600 of MSRP but 25% of the watch's market price, when they could be getting 100% of a $23,000 pie. Don't think that number has been lost on them.