The Bubble is still inflating!

[murkeywaters]

Demand for Rolex watches is on the rise as the super-rich shrug off the inflation crisis gripping Britain.

Watches of Switzerland, the UK’s largest seller of luxury timepieces, said that waiting lists are growing longer because buyers are overlooking a jump in selling prices...............

https://www.telegraph.co.uk/business...off-inflation/

[kevkojak]

But waiting lists have far exceeded production for years now... the fact that they are getting longer doesn't mean anything. Certainly not that the bubble is growing (in my eyes) - quite the opposite. People are queuing for Rolex at RRP while the massively inflated grey market shrinks. I was amazed to see the "discounts" on the BLNR last time I looked. Those were approaching £18k not too long ago, these days they are listing at up to 5 grand less than that.
Obviously the bubble as we call it changes with the wind, but I think most models have reached a peak and started to roll back (albeit very slightly in most cases).

[Wallasey Runner]

I’m not subscribing to read the article, in lay man’s terms what does it say.

[NigeG]

I’m not subscribing to read the article, in lay man’s terms what does it say.

Ditto…..can’t afford a newspaper subscription. Too busy putting every spare penny into my GMT Master pot ready for the call :-)


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[chrisparker]

I’m not subscribing to read the article, in lay man’s terms what does it say.

Firm who sells watches in a declining market says demand is still high.

[theancientmariner]

I'm not subscribing either as from the first couple of lines that I can read it simply says that WoS overall sales were up 20 percent. Now either Rolex are supplying 20 percent more watches to WoS or WoS are selling 20 percent more watches overall which is probably taken up by the lower demand luxury watches. I imagine it's the latter.

there's not really a Rolex watch that I like but I feel as though I should become part of a waiting list just for fun, I almost feel like I'm missing out on something exciting if the Telegraph are writing an article on it!

[Wallasey Runner]

Firm who sells watches in a declining market says demand is still high.

Pisses me off that people on here attach links that require subscription.

Just bloody screenshot the article and post it.

[murkeywaters]

I’m not subscribing to read the article, in lay man’s terms what does it say.

For some reason I can see the article even though I dont subscribe, here is what it says -

Demand for Rolex watches is on the rise as the super-rich shrug off the inflation crisis gripping Britain.

Watches of Switzerland, the UK’s largest seller of luxury timepieces, said that waiting lists are growing longer because buyers are overlooking a jump in selling prices.

This has meant growing wait-lists for the pieces. Watches of Switzerland said overall sales rose by a fifth to £1.5bn in the year to the end of April. The company’s share surged almost 10pc, making it the biggest riser on the FTSE 250.

It is the latest sign that the super rich are continuing to spend despite rising prices for many of the most in-demand items. According to watch specialist Luxe Watches, some Rolex watches are selling for more than 11pc more in the UK this year compared to last, with the price for the Day Date White Gold model rising to £35,000 – £31,450 in early 2022,. according to the website Luxe Watches.

Meanwhile, other luxury watches have also been in high demand. Separately on Thursday, Swatch Group, the owner of Omega, said its revenue could hit record highs this year, amid a boom in sales in China and the US. Average sales per store were up 30pc across the world, Swatch said. Shares were up 5.6pc in the Swiss manufacturer.

It follows the lifting of Covid restrictions across the world, which has sparked a surge in spending on luxury goods – particularly among Chinese shoppers. LVMH earlier this year became the first company in Europe to hit a $500bn (£382bn) market value, thanks to significant appetite for its brands including Louis Vuitton and Christian Dior.

Spending on timepieces, in particular, has been on the rise amid mounting concerns of an economic downturn, since some investors regard certain watches as almost recession-proof.

Burlington Arcade dealer David Duggan told the Telegraph late last year that the Rolex Daytona was a good example of this.

“It may carry a big premium, but over a decade or so, it will still rise in value. It has been this way since 1989. Prices dropped slightly in 2008, but they quickly bounced back. What other product has kept its premium for 33 years?”

Watches of Switzerland chief executive Brian Duffy earlier this year said: “Watches are seen as a logical one to invest in, with inflation.

“These are products which last forever and they’re more likely to appreciate than depreciate.”

[helidoc]

I read the article as a subscriber, and thought it was basically nonsense. Prices peaked March last year didn’t they?

Fairly disinterested observer as I’m pretty much out, barring one call I won’t get.

D


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[pete-r]

Err that's a really odd article and they have it all wrong. The super rich were the ones buying 25k OPs and 50k Daytona steel etc and those markets are known to be falling hard.

The folk waiting years for watches are not the wealthy (I want it now) crowd, they are the either the principled enthusiasts or the wannabe profiteers who can't/won't pay over retail.

Statistically when times are tough the lottery sells more tickets, and the Rolex lottery is similar so more people are trying to play. Once they fall in popularity demand (in no way inflation linked) then the waiting lists will consist of many who no longer want that watch because there's no quick buck to be made.

Typical Telegraph.

[jukeboxs]

Makes me feel particularly honoured for getting "the call" this week.

[Dr Wolff]

“It may carry a big premium, but over a decade or so, it will still rise in value. It has been this way since 1989. Prices dropped slightly in 2008, but they quickly bounced back. What other product has kept its premium for 33 years?”
Houses?
Equities?
Classic cars?
Whisky?
Wine?
Gold?

[deepreddave]

Surely more people will want to buy from ADs if the gap between retail and grey price narrows so lists would lengthen. Then again the whole smoozing ADs and buying what you don't want to get what you do is a mystery to me!

[Dave+63]

It must be true, they said it three times in the first three sentences!

[mijyou]

Try this link for the article

https://12ft.io/proxy?q=https%3A%2F%...f-inflation%2F

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[David_D]

Even with a rally on the back of recent results, WoS shares are down 30% since early February and off more than 50% since January 2022.

[erics]

Of course they are going to talk the market up! What do you expect?

Watch company saying huge demand for watches <shocker>.

If all was going swimmingly, they would not have to published articles in popular newspapers...

[TheTigerUK]

Of course they are going to talk the market up! What do you expect?

Watch company saying huge demand for watches <shocker>.

If all was going swimmingly, they would not have to published articles in popular newspapers...

This !!

[theancientmariner]

If all was going swimmingly, they would not have to published articles in popular newspapers...

that's like saying Rolex must be struggling as they advertise at lots of major sports events. Everything does seem to be going swimmingly for WoS and a little positive PR never harmed anyone.

[robert75]

that's like saying Rolex must be struggling as they advertise at lots of major sports events. Everything does seem to be going swimmingly for WoS and a little positive PR never harmed anyone.

You think so? its almost a cut and paste of similar articles post covid

The market is up, everyone in China is desperate to come to the UK and hoover up cheap luxury watches (even though on another thread someone pointed out brands like Rolex can be had in Singapore with little issue oh no they would rather travel halfway across the globe to support British business)

If you go out into the garden in the evening time you might catch the flocks of flying pigs heading south for winter

[smokey99]

It just a bit of clickbait and uses the Rolex name to increase traffic.

The real story is just the massive increase in WoS turnover / profits since last year despite the economic challenges.

Their reporting shows a 28% increase in the sales of luxury watches and I’d be surprised if they’d suddenly found another 28% Rolex models to sell?

I’m assuming that’s just as a result of the new paradigm that involves all ‘luxury Swiss’ watches being super expensive now.

Customers just keep lapping it up despite the crazy pricing for decent but fairly ordinary watches.


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[dandanthewatchman]

The article in the Times is more factual. My take is
1. PLC company has results scrutinised and publicised
2. An element of story that sales are up in a luxury sector despite the economic woes
3. WOS happy to add some fluffy comments to all the above
4. TZers fail to believe that the polarisation in wealth means people are still buying …. And it doesn’t suit a typical TZ’ers narrative as they want to believe the clock will go back to a time when they can get the likes of Omega and JLC at 20% off list and any Rolex model (save steel Daytona) at list without a wait


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[Daddelvirks]

I don't love watches that much to throw silly amounts of money at them or start begging at my 'local' jeweller.

There's often not to much difference between a micro-brand watch and an expensive 'premium' brand watch.

And you can't buy status, you have to earn it, so I'm out.

[Gareth-W]

The article in the Times is more factual. My take is
1. PLC company has results scrutinised and publicised
2. An element of story that sales are up in a luxury sector despite the economic woes
3. WOS happy to add some fluffy comments to all the above
4. TZers fail to believe that the polarisation in wealth means people are still buying …. And it doesn’t suit a typical TZ’ers narrative as they want to believe the clock will go back to a time when they can get the likes of Omega and JLC at 20% off list and any Rolex model (save steel Daytona) at list without a wait


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You've got no future here at TZ with that kind of common sense post Dan........!!

[earlofsodbury]

Firm who sells watches in a declining market says demand is still high.

[theancientmariner]

The market is up, everyone in China is desperate to come to the UK and hoover up cheap luxury watches (even though on another thread someone pointed out brands like Rolex can be had in Singapore with little issue oh no they would rather travel halfway across the globe to support British business)

Don't ask me why but the Chinese love coming to the UK. I suspect it's because they have such spending power that they have access to Rolex etc. at RRP and then they're also entitled to a 20 percent reduction when they export the item back to China. I suspect that Singapore don't have a similar arrangement.

[TKH]

WOSG are lets be honest selling their products at ‘rrp’ so yes whilst the greys have taken a hit having bought in stock at multiples over rrp and buyers who couldn’t wait have negative equity,WOSG have simply carried on selling everything that arrives from Rolex & PP at full rrp and other brands such as Omega and IWC are also performing well as such they are turning in solid results.

WOSG a bit like JD Sports have insulated themselves from pitfalls of UK market dependency by buying up overseas outlets in Europe and US which is working well and Airport sales are back.

There are very few businesses that can sell almost everything at full margin and have lists of buyers in the wings should someone decline, they can almost write their FYE accounts in advance if they know exact supply for the year and have well controlled fixed costs.

No doubt lists have halved so instead of 10 waiting for a Sub there might only be 5 but the half that have evaporated are the speculators which is good news for genuine enthusiasts they might get a watch sooner and are more likely to be a brand fan and keep it.

There is a sector of buyers for whom an interest rate hike is a blessing and not a curse.



The group’s statutory pre-tax profit jumped by nearly a quarter, from £126 million to £155 million in the latest year.
The record year for revenues and profitability came despite a more challenging trading environment during the second half of the financial year, Watches of Switzerland said.
It was also driven by a surge in revenues in the US of more than a third.
In the UK, tourist sales remain “very low” and demand was driven by domestic customers, but more shoppers returned to airports during the year, it revealed.

[uwtc]

Of course they are going to talk the market up! What do you expect?

Watch company saying huge demand for watches <shocker>.

If all was going swimmingly, they would not have to published articles in popular newspapers...

It is all going swimmingly though according to their FY23 results:


Group revenue £1,543 million, +25% at reported rates, +19% at constant currency on prior year

o Luxury watch sales grew 28% year-on-year (representing 87% of Group revenue) driven by a combination of increased average selling price (ASP) as well as volume growth

o Luxury jewellery sales grew 10% driven by an increase in ASP with focus on full price sell through.


Newspapers have journalists. I imagine they contacted WoS for comment after they published their results..

[gbn13]

The article in the Times is more factual. My take is
1. PLC company has results scrutinised and publicised
2. An element of story that sales are up in a luxury sector despite the economic woes
3. WOS happy to add some fluffy comments to all the above
4. TZers fail to believe that the polarisation in wealth means people are still buying …. And it doesn’t suit a typical TZ’ers narrative as they want to believe the clock will go back to a time when they can get the likes of Omega and JLC at 20% off list and any Rolex model (save steel Daytona) at list without a wait


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A reasonable interpretation.

[threescoops]

Don't ask me why but the Chinese love coming to the UK. I suspect it's because they have such spending power that they have access to Rolex etc. at RRP and then they're also entitled to a 20 percent reduction when they export the item back to China. I suspect that Singapore don't have a similar arrangement.

I’m assuming that 20% is VAT. If so, tourists are no longer able to claim it back.

Burberry mentioned here as seeing more trade in Paris and Milan than London, with the lack of VAT reclamation as a possible factor: https://www.theguardian.com/business...-says-burberry

[Passenger]

Don't ask me why but the Chinese love coming to the UK. I suspect it's because they have such spending power that they have access to Rolex etc. at RRP and then they're also entitled to a 20 percent reduction when they export the item back to China. I suspect that Singapore don't have a similar arrangement.

It seems the gloss has come off a bit...obvs the covid interruption´ll will have had an impact but visitor numbers are currently wayheyhey down,

https://www.statista.com/statistics/...nd%20in%202022.