Went to try on a couple watches with a renowned grey market dealer in my area and had a little chat about how they are able to “order” brand new Rolex watches. Just thought I’d share with fellow Rolex fans here, no hate.
TLDR; ADs need to sell to grey dealers to survive and Rolex doesn’t care.
Grey market dealers make orders directly with ADs. When AD stores used to get 400-500 watches a year (edited: not month), they have no problems supporting the expenses of their stores and could even give discount to clients off retail price. However, in recent years (whether due to Covid19 or not), ADs have seen dramatic cuts to their supplies. Don’t get me wrong, they are still getting watches, just less. But their expenses have not dropped. This means that they will have to find a way to pay for the same or higher level of expenses with significantly less Rolex watches. Inevitably, all this means that they have to sell directly to grey market dealers who can keep paying high price and gobble up watches quickly to make up for the shortfall and keep the Rolex stock coming. The ADs apparently also require proof that the grey market dealer has sold the watches before selling more watches to them.
The grey market dealer also said even if Rolex knows this, Rolex doesn’t quite care (even if they appear as if they do), because Rolex is the one responsible for intentionally cutting supply to create an impression of higher demand in the first place. This insatiable and never ending demand for Rolex watches is an endless loop that feeds itself because it will create more demand as the high price in the grey market shows how precious and unattainable these watches are, and this in turn benefits Rolex.
Of course, not all ADs are as described above, and although nothing above is all that surprising, it’s a fresh reminder that scarcity is driven by Rolex but unfortunately targeted at the middle income class. There is only scarcity for those who can’t afford the wait or the grey price. There is no scarcity for the rich – they can afford the grey and don’t care. In fact, a friend of mine regularly buys Daytonas from that grey dealer I spoke to. It’s a shame because the brand name and the beauty and romance of a Rolex watch is truly amazing.
To those that are still waiting for the call (like me), good luck and hope you get it sooner than later! Don’t go grey! Happy Sunday!