Has the Rolex bubble finally burst? Perhaps it has

Has the Rolex bubble finally burst? Perhaps it has

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Discussion

Louis Balfour

26,534 posts

224 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
Carl_Manchester said:
If you believe the structural decline thing then start shorting Richemont shares. There's a whole basket of watch brands in there inc. Panerai and IWC.
Caution here. Management reprice up hard, so their financials improve. They have also shifted business models with tighter controls on arms length distribution. Inventory is piling up. Basic models are being flogged at exorbitant prices. Plenty of capital to support stock price via HFT.

The watch market is pretty much dead in the water and the luxury companies are being propped up as the entire industry is in poor health.
Whilst I could not claim this to be a reliable barometer of the watch or luxury market, when I was on Bond Street last week it didn't FEEL like it was in rude health.

Wempe has gone, citing an incoming Rolex boutique on the street, though I am not sure that is the whole story. Russell and Bromley has closed both its stores, it appears, and there were one or two empty units. Some brands were moving along the street. Maybe I just caught it at a bad time, but it felt flat.





GilletteFan

672 posts

33 months

Tuesday 4th April 2023
quotequote all
Louis Balfour said:
Whilst I could not claim this to be a reliable barometer of the watch or luxury market, when I was on Bond Street last week it didn't FEEL like it was in rude health.

Wempe has gone, citing an incoming Rolex boutique on the street, though I am not sure that is the whole story. Russell and Bromley has closed both its stores, it appears, and there were one or two empty units. Some brands were moving along the street. Maybe I just caught it at a bad time, but it felt flat.
If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision. And let's not get the intricacies of commercial property involved here too. The luxury industry has a lot of capital behind it - if you know what is meant - and spending must happen, so you will see "people" buying. However, it has been on decline for some time. I felt a marked decline just after the Apple Watch was launched. Almost my entire professional and personal circles gave up wearing their luxury time pieces. This is when pricing really skyrocketed and value was difficult to come by. Good luck getting a ten plus year old beater for a bargain now. You will be paying much more than the hoarder did when the acquired it. What a rort.

Out with the old and in with the new.

Edited by GilletteFan on Tuesday 4th April 08:49

Louis Balfour

26,534 posts

224 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
If it didn't feel like things were not in rude health it means someone is doing their job properly.

Edited by GilletteFan on Tuesday 4th April 08:49
Presumably you mean "isn't"?


GilletteFan

672 posts

33 months

Tuesday 4th April 2023
quotequote all
Louis Balfour said:
Presumably you mean "isn't"?
No, I meant what I wrote. I hope this still makes sense in context. I've read my statement a few times and it does. One has to think commercially to make sense of it.

Louis Balfour

26,534 posts

224 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
Louis Balfour said:
Presumably you mean "isn't"?
No, I meant what I wrote. I hope this still makes sense in context. I've read my statement a few times and it does. One has to think commercially to make sense of it.
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.

GilletteFan

672 posts

33 months

Tuesday 4th April 2023
quotequote all
Louis Balfour said:
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.
Watch transactions are down. If things appeared flat, they are doing a hell of a good job at keeping up appearances. Well done to them. Especially considering the environment and what's been happening in the UK behind the scenes. Again, the goal is to appear like things are slowing in line with the economy and headwinds.

Louis Balfour

26,534 posts

224 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
Louis Balfour said:
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.
Watch transactions are down. If things appeared flat, they are doing a hell of a good job at keeping up appearances. Well done to them. Especially considering the environment and what's been happening in the UK behind the scenes. Again, the goal is to appear like things are slowing in line with the economy and headwinds.
So you're saying that it looked flat, but if the true picture had been clear it would have been deserted?

Saweep

6,613 posts

188 months

Tuesday 4th April 2023
quotequote all
Louis Balfour said:
GilletteFan said:
Louis Balfour said:
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.
Watch transactions are down. If things appeared flat, they are doing a hell of a good job at keeping up appearances. Well done to them. Especially considering the environment and what's been happening in the UK behind the scenes. Again, the goal is to appear like things are slowing in line with the economy and headwinds.
So you're saying that it looked flat, but if the true picture had been clear it would have been deserted?
This is all very confusing.

eccles

13,747 posts

224 months

Tuesday 4th April 2023
quotequote all
Saweep said:
Louis Balfour said:
GilletteFan said:
Louis Balfour said:
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.
Watch transactions are down. If things appeared flat, they are doing a hell of a good job at keeping up appearances. Well done to them. Especially considering the environment and what's been happening in the UK behind the scenes. Again, the goal is to appear like things are slowing in line with the economy and headwinds.
So you're saying that it looked flat, but if the true picture had been clear it would have been deserted?
This is all very confusing.
That's because you're not thinking 'Commercially' wink

NDA

21,719 posts

227 months

Tuesday 4th April 2023
quotequote all
In other news:

"There was no sign of a slowdown in the luxury watch market, as Watches of Switzerland reported a 17% increase in revenue for the three months to 29 January 2023..."

"In its latest accounts (Pragnells), for 12 months turnover rose by 35%."

I am sure it's not all beer and skittles in some corners of the luxury watch market, particularly for dealers in second-hand watches who have been stung by the fall from earlier ridiculous pricing.

I also doubt that the billions being invested in the sector, from Bremont to Rolex is being done recklessly.

GilletteFan

672 posts

33 months

Tuesday 4th April 2023
quotequote all
eccles said:
That's because you're not thinking 'Commercially' wink
It's apparent some people don't work in strategy, finance and other stuff that makes investor presentations/ analyst days look all snazzy and fine.

It's ok. Please continue to pay the asking prices. If you do get a discount, just know you are still overpaying. There is no coming back for the Swiss watch industry. No matter how much left pocket/ right pocket antics are being used.

Out with the old and in with the new.

tangerine_sedge

4,867 posts

220 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
eccles said:
That's because you're not thinking 'Commercially' wink
It's apparent some people don't work in strategy, finance and other stuff that makes investor presentations/ analyst days look all snazzy and fine.

It's ok. Please continue to pay the asking prices. If you do get a discount, just know you are still overpaying. There is no coming back for the Swiss watch industry. No matter how much left pocket/ right pocket antics are being used.

Out with the old and in with the new.
Oh! You work in finance, I can remember another poster who worked in finance who left PH for a while. Interesting posting history you've got, huuuuuge gaps in posting then suddenly a flurry across several threads.

Apropos of nothing, have you bought a Porsche on Ebay recently?

iphonedyou

9,283 posts

159 months

Tuesday 4th April 2023
quotequote all
GilletteFan said:
It's apparent some people don't work in strategy, finance and other stuff that makes investor presentations/ analyst days look all snazzy and fine.

It's ok. Please continue to pay the asking prices. If you do get a discount, just know you are still overpaying. There is no coming back for the Swiss watch industry. No matter how much left pocket/ right pocket antics are being used.

Out with the old and in with the new.
I don't think you'd face much argument from anybody on this thread in stating that luxury watches are overpriced for what they are, to be honest. It's a case of whether people are willing to pay that premium, and of course many are.

minimalist

1,494 posts

207 months

Tuesday 4th April 2023
quotequote all
A Dublin jeweller and watch dealer must be feeling nervous with six new boutiques. Some of them opened just before Christmas. I haven't been recently but they should be all open now. I assume he signed the leases and supplier contracts when the watch market was much more buoyant.

THE IRISH TIMES - Paul Sheeran Jewellers to open six luxury watch ‘boutiques’ off Grafton Street

Edited by minimalist on Tuesday 4th April 12:44

okgo

38,389 posts

200 months

Tuesday 4th April 2023
quotequote all
tangerine_sedge said:
Oh! You work in finance, I can remember another poster who worked in finance who left PH for a while. Interesting posting history you've got, huuuuuge gaps in posting then suddenly a flurry across several threads.

Apropos of nothing, have you bought a Porsche on Ebay recently?
WB posts made even less sense than this guys.

As NDA reports above, numbers are the numbers. I’m on a conference currently, many folk wearing luxury watches. Some wearing smart watches.

Deep

2,076 posts

245 months

Tuesday 4th April 2023
quotequote all
NDA said:
In other news:

"There was no sign of a slowdown in the luxury watch market, as Watches of Switzerland reported a 17% increase in revenue for the three months to 29 January 2023..."

"In its latest accounts (Pragnells), for 12 months turnover rose by 35%."

I am sure it's not all beer and skittles in some corners of the luxury watch market, particularly for dealers in second-hand watches who have been stung by the fall from earlier ridiculous pricing.

I also doubt that the billions being invested in the sector, from Bremont to Rolex is being done recklessly.
But....all the cool kids have had their fun and got out!

GilletteFan

672 posts

33 months

Tuesday 4th April 2023
quotequote all
I'm totally convinced things are all good with the luxury watch industry even though Morgan Stanley provided some insightful research figures. And, the lower the base, the easier it is to demonstrate a higher percentage improvement. For example, Random Swiss Watch Company using Manufacture movement with amazing history is up 25% quarter-on-quarter. In real numbers, I sold 5 watches versus 4 the last reporting quarter. And all of them were to my good pals.

Having said this, I totally believe all the statistics, rhyme and reason conveyed. Don't worry too much as I doubt anyone reading my posts on this topic would believe me anyways that the watch industry is dead in the water. After all, what would I know?


eccles

13,747 posts

224 months

Tuesday 4th April 2023
quotequote all
iphonedyou said:
GilletteFan said:
It's apparent some people don't work in strategy, finance and other stuff that makes investor presentations/ analyst days look all snazzy and fine.

It's ok. Please continue to pay the asking prices. If you do get a discount, just know you are still overpaying. There is no coming back for the Swiss watch industry. No matter how much left pocket/ right pocket antics are being used.

Out with the old and in with the new.
I don't think you'd face much argument from anybody on this thread in stating that luxury watches are overpriced for what they are, to be honest. It's a case of whether people are willing to pay that premium, and of course many are.
It's Ok, he's such a good bloke at finance he buys Apple products, which we all know are in no way luxury goods and overpriced! rofl

Louis Balfour

26,534 posts

224 months

Tuesday 4th April 2023
quotequote all
Saweep said:
Louis Balfour said:
GilletteFan said:
Louis Balfour said:
You said:

"If it didn't feel like things were not in rude health it means someone is doing their job properly. It costs less money to keep up appearances than to become bankrupt. It's an easy commercial decision."

So if someone was doing their job properly I would not have got the impression that Bond Street was flat. I.e. they'd have been keeping up appearances. Which they weren't.
Watch transactions are down. If things appeared flat, they are doing a hell of a good job at keeping up appearances. Well done to them. Especially considering the environment and what's been happening in the UK behind the scenes. Again, the goal is to appear like things are slowing in line with the economy and headwinds.
So you're saying that it looked flat, but if the true picture had been clear it would have been deserted?
This is all very confusing.
I think he means that someone is or isn't doing their job properly, that Bond Street is busier than it appears or might be quieter depending upon whether someone works in finance and thinks commercially in strategy. Maybe.


gregs656

10,949 posts

183 months

Tuesday 4th April 2023
quotequote all
NDA said:
l

I also doubt that the billions being invested in the sector, from Bremont to Rolex is being done recklessly.
These are all slow ships aren’t they. It does feel a little like these companies were investing and increasing prices while the sun shined, but now it isn’t.

The watch industry took blows in 2008 as well, but it’s still here.