£437m of Watches "recycled"

[reecie]

From https://www.theguardian.com/business...buyback-policy

The Swiss watchmaker Richemont has destroyed nearly €500m (£437m) of its designer timepieces over the past two years to avoid them being sold at knockdown prices.
The Geneva-based luxury goods group behind Cartier and Montblanc said it bought back €203m of unsold watches last year. That was on top of the €278m of Cartier watches, which start at £1,000 but can cost more than £20,000, it reclaimed from jewellers in 2017.

Aka Keep the scarcity and prices up. Lot of money spent to do it though.

[Papa Hotel]

Surely slightly off to say "destroyed"? Movements will be reused, I'd imagine hands, dials, casebacks, all that stuff will be retained as service replacements. No company would destroy half a billion quid of stock to maintain exclusivity, that's bonkers.

[200mwaterresistant]

This does make sense. Nothing destroys a luxury brand like being sold off as clearance. Look what Sports Direct have done to the North Face which they now sell, and are being worn by chavs everywhere. It used to be a good brand!

[-Ally-]

I heard Rolex do this with Cellinis...

[Omegamanic]

I heard Rolex do this with Cellinis...

Lol, really?

But...

They did it with unsold precious metal DD & DJII’s I believe.

[Dave O'Sullivan]

I'd also imagine that's the value at rrp.
Cost would be much less to them.

[P9CLY]

This does make sense. Nothing destroys a luxury brand like being sold off as clearance. Look what Sports Direct have done to the North Face which they now sell, and are being worn by chavs everywhere. It used to be a good brand!

Maybe they should sell the watches at bargain prices to the chavs wearing North Face gear init,which will enhance their chaviness and so look dead cool init,or to all estate chavs in grey tracksuits tucked into their socks!!!!......init.

[Kitz]

I heard Rolex did it with Sea Dwellers which is why they are exclusive.


Sent from my iPad using TZ-UK mobile app

[anz3001]

I suspect very little went to waste.

[I AM LATE!]

Quoted from the article:

“The watches are dismantled and recycled, with the most recent stockpile stemming from its specialist watchmakers division, which includes brands such as Piaget, IWC and Vacheron Constantin.”

[Caruso]

If only they had Sports models with long waiting lists they could use this as leverage to sell off some of the more dressy stock.

[chejay]

Oh my god. Interesting post:)

[ajpac]

Similar to a company buying its shares back?

[alfat33]

Similar to a company buying its shares back?

Not really. That is a way of returning surplus cash to shareholders as the value of the remaining shares will increase. In this instance, all the work and cost that went into making and shipping the watches is wasted and written off, so the shareholders lose money (even if parts are reused etc.).

[anz3001]

I’m surprised that they buy back to be honest. I always assumed most stock was on sale or return.

[endo]

Louis Vuitton have done this for years, if it doesn't sell it gets destroyed. Hence why there is never a sale or discount to be had.

I think it's a good model to have, stops all the stagnatnt stock that shops have on display, andnothing is more annoying than buying something only to have it pop up for half price a week later.

[animalone]

And yet they still made a £1.8 billion profit !

[MST]

Look what Sports Direct have done to the North Face which they now sell, and are being worn by chavs everywhere. It used to be a good brand!

I couldn't agree more, bought a North Face triclimate jacket from Cotswold Outdoor just before Christmas and the quality is NOTHING like it used to be, not quite Sports Direct pricing though...funny that!

[200mwaterresistant]

Louis Vuitton have done this for years, if it doesn't sell it gets destroyed. Hence why there is never a sale or discount to be had.

I think it's a good model to have, stops all the stagnatnt stock that shops have on display, andnothing is more annoying than buying something only to have it pop up for half price a week later.

If you haven't already then read the book Gomorrah on which the TV series is based. An eye opening insight into high fashion.

[Gruntfuttock]

If you haven't already then read the book Gomorrah on which the TV series is based. An eye opening insight into high fashion.

Well nobody wants to be seen with last year's handbag now do they! Where watches are concerned, I am not remotely surprised this happens, seeing how awful some of those Richmont brands look in the shop window. If they weren't put away in the safe each day they would need regular dusting, as they clearly don't sell.

[dave.charlton]

Its interesting to see how the watch business works, I imagine the retailer can send back any stock over a certain age and get full credit for it as long as they take at least the same value in new stock, therefore making their stock less dated, and more attractive.
Everything they return will be up cycled as parts etc - so no real loss to Richmont.

[robert75]

This does make sense. Nothing destroys a luxury brand like being sold off as clearance. Look what Sports Direct have done to the North Face which they now sell, and are being worn by chavs everywhere. It used to be a good brand!

North Face was the brand of choice for scallies for years, if anything sports direct are about 10 years too late and as much as I dislike sports direct I don’t think it was them that dragged the brand down.