Source of this article: Times Finance Author: Wang Yan
Image source: Figureworm Creative
Since the announcement of price adjustments at the beginning of this year, "price increase" has become the key word for Rolex, and the market price of popular styles has soared, constantly refreshing record highs. However, in less than 3 months, the situation took a sharp turn for the worse.
In early April, the price of the Rolex hit began to dive downwards. At that time, industry insiders generally believed that this was just a "technical adjustment". However, to the surprise of the market, this adjustment has not yet ushered in an inflection point.
"A second-generation green water ghost, the cost price of the goods I took in February was 162,000 yuan, and the current market price is about 130,000 yuan, which has lost more than 30,000 yuan." Watch collector Li Qi lamented to Times Finance.
According to Times Finance, among the many Rolex styles, The biggest decline in The Green Jindi, the price of the watch at the craziest time in the market in February this year soared to 800,000 yuan, but the current price is only about 600,000 yuan. The price of other Rolex watches is also unstable - the price of White Steele fell from 400,000 yuan to 300,000 yuan, and the five-bead chain red and blue circle fell from 250,000 yuan to 150,000 yuan.
"Compared with the price changes in the past two or three years, this should be the most tragic decline in Rolex. How crazy the bezel was in February, how deserted it is now. Li Qi told Times Finance.
Speculating on Rolex is like speculating in stocks, and if you accidentally fall into a Hermès bag
As a luxury giant, Rolex has always been known for its high recognition, rare models, firm prices and high retention rate. There is a more "once and for all" saying in the industry, and many people hold value-added considerations to collect Rolex's limited edition watches.
In January this year, Rolex officially announced that it would simultaneously raise the official pricing of global brands, and the average increase in its watches was about 3% to 10%. Since then, Rolex has issued new sales regulations in 2022, requiring new arrivals in stores to be sold within 10 days, each counter is mandatory to display 10 watches and cannot be sold, real-time inventory should meet 60 and cannot be sold, and the number of monthly card opening places is about 20 to 30.
The implementation of the above policies has indirectly pushed up the price of Rolex in the second-hand market. From the end of last year to February this year, a black circle Daytona, which is officially priced at 231,900 yuan, has soared to more than 319,000 yuan. The most important reason for the surge is that in the official channels, the watch has been out of stock, and customers need to queue for more than 3 years to get the goods after making an appointment at the counter.
To the surprise of the industry, in just over a month, the Rolex market, known as hard currency, suffered "Waterloo". Since the beginning of April, the price of the second-hand Rolex market has begun to decline, and the price of some models has dropped by 40% compared with the highest point.
Falling with Rolex are well-known luxury watch brands such as Audemars Piguet. "Audemars Piguet is worse than a Rolex, a watch with a model of 15400OR, the price was 370,000 yuan a week ago, and now it is only 320,000 yuan. The most brutal fall is the Audemars Piguet 50th anniversary limited model, this watch was speculated as high as 2 million yuan, since then the price has been stable at 1.8 million yuan, but recently fell directly below 1.5 million yuan. Li Qi told Times Finance.
The decline in the price of Rolex has also caused many watch middlemen to suffer heavy losses.
2 months ago, Liu Cong, who opened a watch shop in Wuxi, hoarded several Popular Rolex watches such as Daytona and Water Ghost, but as the Market of Rolex went all the way down, the watches in his hands also depreciated rapidly.
"This month fell down almost a watch to lose nearly 100,000 yuan, which is still not counting the cost of funds, counting interest, the loss is even greater." Liu Cong said.
Wang Ping, who does Rolex business in Guangzhou, told Times Finance that in the past 2 months, in the second-hand market, Rolex's popular styles, such as water ghosts, Daytona, etc., have mostly seen declines ranging from tens of thousands of yuan to hundreds of thousands of yuan. At the beginning of the year, second-hand merchants who made a lot of money by reselling watches also began to give back profits, and many people collected inventory piled up at home.
"Speculating in Rolex is the same as the stock market, especially popular models such as Daytona and Green Gold, and slight price fluctuations may lose a Hermès leather bag." Wang Ping told Times Finance that the price of domestic Rolex has basically fallen back to the level at the end of last year.
For the reasons for the sudden decline in the Rolex market, Wang Ping said on the times financial analysis that in the past, the end of each year to the beginning of the second year was the peak of sales of luxury goods such as watches in the Chinese market, and now it has begun to enter the off-season, and the market demand is not strong. In addition, the outbreak of the epidemic in Shanghai has also affected the purchasing power of domestic luxury watches in the near future, and the market in the secondary market has naturally declined.
The market price is chaotic, some people stop losses, some people continue to wait and see
The market price quickly slipped, so that many people chose to stop loss and return blood.
Liu Cong told Times Finance that the recent hoarding capital costs and employee expenditures are huge, and can only temporarily sell a part of the watch at a loss to return blood. Just a few days ago, he sold a gold watch for 160,000 yuan, and finally sold it for 140,000 yuan. "Later, we will find opportunities to buy Rolex at a low price to dilute the previous losses." Liu Cong said.
Similar to Liu Cong's situation, there is also Zeng Wenlong, a watch enthusiast in Guangzhou. In February this year, he bought two Rolex watches for 60,000 yuan and 80,000 yuan respectively, hoping to appreciate the value of the investment. But in the next two months, Liu Cong failed to speculate in stocks and suffered heavy losses. Recently, he wanted to sell his watch to get back his blood, but it coincided with the decline in the Rolex market, and he could only sell at a loss. "The 2 watches are brand new, they haven't been used yet, and now they have to lose 20,000 yuan when they are sold." Zeng Wenlong told Times Finance.
In the case of merchants and speculators are eager to ship back to the blood, the market price system of Rolex has also begun to become chaotic. Times Finance noted that in the second-hand watch market, the same plate chain red and blue circle watches produced in 2021, some channel providers asked for 145,000 yuan, but some people claimed to have shipped at a price of 160,000 yuan.
Liu Cong explained to Times Finance that in order to ship quickly, some speculators will choose to release fake news. "For example, putting up news, rumors that some watch styles are discontinued, creating the illusion that supply is in short supply, and some people will also accompany videos and pictures."
"After experiencing a round of price surge, with the influx of collectors and speculators, a large number of Rolex watches have been squeezed in second-hand merchants and other channels, which makes Rolex's market price system become extremely fragile, once there are problems such as broken capital chains, there may be price reductions, sell-offs and so on." Wang Ping told Times Finance.
In contrast, Wang Ping was slightly lucky, he caught the last wave of soaring market, and made a small profit. At the end of last year, he bought a white steel watch for 220,000 yuan and sold it for 330,000 yuan in February this year. Recently, he also targeted a green water ghost watch, the watchmaker quoted 136,000 yuan, he thought the price was more cost-effective, but did not choose to start.
Wang Ping pointed out that whether it is popularity or retention rate, Rolex has risen rapidly in the famous watch circle in recent years, and has its own advantages in marketing and quality, but Rolex is not a top luxury watch, even if it has experienced a round of price correction, but the current second-hand price and the actual value are too different. "After a period of time, manufacturers continue to replenish, and second-hand prices will definitely continue to cool." Now blindly kill it, it is likely to go to pick up the plate. Wang Ping told Times Finance.
Second-hand prices plummeted, but counters still had to queue up to pick up goods
The price of the second-hand market has fallen and fallen, and it seems that there is no impact on the Rolex counter.
A staff member of the Rolex counter in Guangzhou told Times Finance that at present, the major styles of watches in the counter are in short supply, and the queuing cycle is relatively long. "Some popular watch styles, such as the Blackwater Ghost series, Daytona, etc., have been queuing for more than a year." In this Rolex store, even entry-level products such as Rolex's log series require consumers to queue up to buy.
Li Qi told Times Finance that even though the market price of Rolex has plummeted, the price of most models is still higher than the public price (counter price), and the supply of special counters is naturally in short supply. In addition, according to Li Qi, in some Rolex counters, the brand side will also use the method of tie-in sales to stimulate customer consumption.
"The official retail price of more than 200,000 yuan of a black universe Ditona, the current market price is more than 300,000 yuan, if you want to buy, the condition given by the counter is to tie up another counter price of more than 100,000 yuan of non-popular watches or directly pay 350,000 yuan to buy." Li Qi said.
Li Qi believes that strictly speaking, this is actually a signal of rolex market price stability, because the tie-in conditions of the counter have not been reduced, which also shows that the cost of secondary market products has not declined too much. In addition, although the recent decline in rolex's market, the volume is relatively stable. And compared with the sharp decline in the price of Patek Philippe and Audemars Piguet, the price of Rolex did not have a major decline, but returned to the market before the last wave of surge.
(At the request of the interviewee, Li Qi, Liu Cong, Wang Ping, and Zeng Wenlong are pseudonyms)