It was a strange sight. Globally, the retail displays of one of the world’s most influential and prestigious brands are largely empty. They should include Rolex watches.
We live in strange times but the state of the luxury watch industry is particularly surreal: there aren’t enough Rolex watches to go around. The result? Waitlists, unscrupulous dealers, empty display cases, balloon prices and record-breaking auctions.
What on earth is happening?
The origins of this phenomenon are hotly debated and theorized in watch-collecting circles. Yes, it’s a matter of supply, demand and wanting what you don’t have. But there is more to the story. Some call it a “perfect storm” of interrelated factors driving the watch world into hyperdrive.
Here’s why Rolex watches are so hard to buy right now:
- 1 Only Some Rolex watches are rare
- 2 The Rolex shortage isn’t new, but it’s a serious one
- 3 Rolex is not artificially limiting supply
- 4 The pandemic has affected supply, but that’s not the whole story
- 5 Pandemic conditions have also boosted the demand for luxury watches
- 6 You can still buy a Rolex, you just pay more for it
Only Some Rolex watches are rare
What watches are we talking about exactly? It’s not like there’s a general watch shortage: rather, the phenomenon applies to highly hyped and coveted models, mostly from a few brands. The most common examples are Rolex steel sport (or “professional”) watches — Submariners, GMT Master IIs, Explorers and, of course, Daytonas.
But even some Rolex Oyster Perpetuals are hard to sell above retail. As a popular model became harder to come by, people looked to alternatives, which were picked up by themselves.
Outside of Rolex, there are also exclusive steel watches like the Patek Philippe Nautilus unobtanium. (Moonswatch madness is another, but completely unrelated story.) You know exactly how psychology works, and it’s not unique to watches, but what’s the difference in the current situation?
The Rolex shortage isn’t new, but it’s a serious one
Rolex waiting lists are not an entirely new phenomenon, and general interest in the watches has been growing over the years – with many horological pundits seeing a real shortage in 2016 with the release of the current generation Rolex Daytona. But the roots of this frenzy go back further.
“Watch collecting used to be a closed community of very passionate people that held small private gatherings and events,” says Joshua Ganzi, CEO of the watch retailer. European watch company In Boston. “But with the rise of Internet blogs, watch-only forums, and Instagram, the hobby has truly been democratized.”
This democratization applies not only to the sharing of information and excitement, but it also provides more ways to buy and sell watches. Learning about and buying watches has become easier than ever – and so has speculative buying of hot-ticket items with a view to turning a profit.
Rolex is not artificially limiting supply
Many distraught netizens are upholding the theory that it’s all a sinister corporate conspiracy. A common belief is that Rolex is deliberately limiting supply. Perhaps, this was started on purpose and they felt that Rolex had done so well that they could not realistically keep up with the demand they had now created. Such speculations are rife but we cannot confirm one way or the other.
In a rare statement from Rolex, the brand categorically rejects the idea: “The scarcity of our products is not a strategy on our part,” Rolex said Yahoo Finance. “Our current product does not fully meet the existing demand, at least not without reducing the quality of our watches – which we refuse to do.”
The pandemic has affected supply, but that’s not the whole story
Rolex is unusual in that it manufactures almost every part of its watches, but if a key component or material is delayed or unavailable, everything grinds to a halt. And even simple, time-only mechanical watches have over a hundred small parts.
Like everything else in 2020, the Rolex factory was closed for a few months due to COVID-19, so supply was at least somewhat affected. Rolex does not publicly disclose its production numbers but is estimated to produce around 1 million watches in a typical year (though not all of them belong to its esteemed list of models).
Pandemic conditions have also boosted the demand for luxury watches
While many businesses have struggled since the onset of Covid-19, the luxury industry has had some of its best years.
Mr. Pandemic Impact on Rolex Availability Ganji emphasized: “The supercharged Rolex market over the last few years is the result of a perfect storm of factors. Covid has forced manufacturers to halt production for a while, leading to supply issues and a general. shortage of new watches.”
“At the same time,” he said, “people are stuck at home unable to spend money on travel, restaurants, etc., which means more people are looking to buy luxury goods online, including watches. Rolex sport watches are already highly desirable, but the pandemic has really pushed them into red-hot, almost unobtainable territory. Pushed.” There is no telling when the market will cool down.
You can still buy a Rolex, you just pay more for it
Rolex watches are not “rare”. They are everywhere. Of course, there’s a catch: the collector mentality, the brand’s cult following, and the conditions described above conspire and ping each other to drive up prices.
Even pre-owned models often sell for more than new retail prices. You can go to pre-owned and vintage dealers and often find hundreds of models for sale — sometimes even hundreds with the same reference number.
If you go the shopping pre-owned Rolex route, make sure you trust the seller or go to reputable dealers such as Watch box, Bob watches Or even eBay with their guarantee of authenticity. Although vintage Rolexes are a whole other story, you can check out outfits like A clock shop, Wind Vintage, Analog/Shift and others.
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