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Rolex to retailers: Stop charging premium for hot models
ROLEX has finally moved to end the years-old practice of its authorised Singapore retailers charging customers a premium for the hot Rolex models.
The move by the Swiss luxury watch-maker came about as the premiums charged for its Rolex Cosmograph Daytona sports watch hit new highs.
The Business Times understands that Rolex recently sent a letter to its authorised retailers in Singapore, instructing them to stick to the recommended prices from March 1, instead of inflating them, especially for the in-demand models.
Rolex Singapore and Cortina Holdings, one of the two major authorised Rolex watch dealers, declined to comment; The Hour Glass, the other major authorised retail chain, did not respond to BT's query.
Retailers usually offer Rolex customers a discount of up to the recommended cap of 15 per cent, but have been known to hit customers with fatter price tags for the sought-after models.
Such models - in stainless steel rather than gold - are normally those from the brand's sports and professional collections, such as the Daytona chronographs, the GMT-Master two-time zoners and the Submariner and Sea-Dweller diver's watches.
Even priced at a premium, they are hard to come by. The waiting period for the hot Rolex models can run into years.
It is still possible to buy them at the regular list price, but that is unlikely to happen in Singapore - and you are unlikely to get it immediately.
Customers who put their names on the waiting list with authorised dealers in Switzerland for the latest Daytona model have been told that they may have to wait eight years; the waiting time for this watch in Australia is a little shorter - five years.
The practice of charging a premium for the in-demand models has gone on for years in Singapore. Some 20 years ago, when the retail price of the Daytona was about S$8,000, the watch was going for S$12,000 here.
Five years ago, a new Submariner was selling at nearly S$3,000 above its recommended retail price; the premiums for the latest GMT-Master and Sea-Dweller are between S$2,000 to S$3,000.
The premiums for the new Daytona, launched last year with a new ceramic bezel, have hit record highs in Singapore, say retailers. Its list price is under S$18,000, but it was being sold for up to S$30,000 at one point. The premium price then settled at around S$27,000 - and that was if stock was even available.
After Rolex's letter ordering an end to the practice, the premium price fell to S$20,000 as authorised retailers tried to make extra money before the March 1 deadline.
Although the move to stop authorised retailers from charging these premiums is obviously bad news for retailers and good news for customers, industry observers say it may also mean that it will be harder for customers to buy what they desire. Without the premium, customers previously deterred by it will now join the queue to buy the watch.
Other observers say it will be difficult for Rolex to police the practice of selling above the list price.
Su Jia Xian, the publisher of watch-collecting website watchesbysjx.com, said: "Enforcement will be tough.
"There are always ways around it, for instance selling the desirable watches like the Daytona at official retail price to clients who also buy the less popular items," he added.
Rolex's move will also affect the grey market, though not directly. But observers are split on how grey dealers will be touched.
Some say they will lose customers to authorised retailers, who now have to adhere to the recommended price list. Others say the grey market can still get away with charging higher prices for the most desired models.