﻿Ever heard of the multi-billion dollar Grey Market and the many
shady deals of Rolex authorized dealers within these markets,
which now constitute one of the world’s most closely guarded secrets?
Whenever you step into your Rolex dealership seeking to acquire a bespoke piece of the luxury
wristwatch, do you get to buy your Rolexes at the recommended Rolex retail price from your
authorized dealer, or you’re being consistently overcharged and getting massively charged more
on every purchase? While Rolex cannot force its authorized dealers or retailers to sell at an
official price, it issues a Recommended Retail Price that all of its authorized dealerships
across the world are encouraged and expected to comply with. But what exactly happens when these
independent authorized dealers choose to focus on their goal of being in business rather than
seeking to live up to the expectations of one of the world’s most valuable luxury brands?
In this video, we’ll be detailing the dirty secrets of some authorized Rolex dealers
and just how you might be coughing up way more than the regular and recommended price
for a piece of your bespoke luxury accessory. The details we’ve unraveled in this video would
leave you awe-struck, so, keep up! While Rolex is continually striving
to achieve uniform prices for its bespoke timepieces across the world,
great differences still exist in the prices of the brand’s wristwatches among its authorized dealers,
and reports of unusual occurrences about unlawful sales have continued to persist, making Rolex’s
best efforts at stopping this rather common practice ineffective. The Rolex market is without
a doubt very distinct and unique when compared to any of the world’s other regular markets. It’s a
market that’s become essentially characterized for many decades by decades-long waiting lists
for many of the brand’s bespoke models and a huge demand that far exceeds what the brand supplies.
With the demand for Rolexes far exceeding its supply and consistently remaining so for many
decades now, what’s followed naturally is that the unit prices for Rolexes have hit the roof and have
remained so for a similarly long time period. But while Rolex itself benefits greatly from
this rather unusual market situation, one that contradicts basic economics, it actively seeks to
reduce the extent to which its authorized dealers are able to push its product prices even further
up, especially by selling via other unauthorized channels like the secondary or grey markets.
While Rolex has tacitly dictated the price of its product for many decades now, it has outrightly
refused to allow retail prices to rise to a level where a greater balance can be achieved.
This rather delicate situation has no doubt created a problem between the brand and many
of its authorized dealers, one which both parties apparently remain to find level ground to squash.
And despite the recent unexpected crash in the market;
one that’s made the prices of Rolexes plunge to never seen before levels,
many authorized dealers have only identified this as a perfect opportunity
and have continued to charge way more than recommended prices at their dealerships.
For many bonafide Rolex customers, news of this alleged unlawful practice by some of their
favorite authorized dealers has been particularly disgusting. Although Rolex authorized dealers
now charge more than the retail price especially for specific models of the brand’s wristwatches,
especially with the prevailing situation of the market, Rolex strictly expects its retailers
to sell their watches for the recommended retail prices, and not for more or less. But
the reality however is that when these authorized dealers are not selling these more popular models
in secondary markets at the highest possible price, they discretely engage in racketeering
within the official channel and still get to sell for way beyond the recommended retail price.
This unlawful practice by some of the brand’s Authorized dealers
has allowed them to quote far higher countless numbers of the brand's esteemed customers
and is a direct violation of the guiding policies in their contract with the brand.
Every official Rolex dealer is bound by a contract that clearly states the rules and policies
that they are expected to follow and basically specifies what they are allowed to do or not do.
But many authorized dealers continue to make a clear distinction between what they are allowed
to do as stipulated in their contract and what they can actually do as independent dealers.
A known fact is that only a single dealership of the 1816
authorized retailers presently operational worldwide is directly owned and controlled
by Rolex. This rather delicate situation makes the contract between Rolex and any of its authorized
dealers, the only channel of control the brand has over these independent retailers, and which is a
very slim one if we’re being honest. And although retailers found of misconduct have been punished
appropriately, a lot of them have mastered the act of discreteness in their shady dealings with
customers, so establishing that some authorized dealers actually sell above the recommended price
is excruciatingly difficult. These authorized dealers likewise
exploit Rolex’s inability to regulate prices in the countries they operate in
due to existing local laws that prohibit this such as the anti-trust laws in the U.S. An attempt by
the brand to regulate prices in countries where such laws exist would constitute price-fixing; a
crime with grave legal consequences. The apparent reality is that many Rolex authorized dealers,
while flagrantly going against the clauses of their contract with the brand,
now exploit the antitrust laws and other similar laws in perpetuating some of the worst known cases
of customer exploitation in the world. To put this prevailing situation into perspective,
a major Rolex authorized dealer was accused of racketeering and selling directly to grey markets
in February 2021. This accusation was made by a whistle-blower staff who refused to be a part of
the scheme and alleged that the said authorized dealer, which also happens to be one of Chicago’s
oldest jewelers and Rolex authorized dealers engaged in these flagrant illegal activities
on several occasions. The said dealer in retaliation terminated her employment right
after the allegations were filed to the District Court for the Northern District of Illinois.
There is quite a plethora of similar cases to this, all alluding to how difficult it
is for Rolex to fish out authorized dealers that rip off customers by selling for way
higher than the recommended prices, except where there is a whistleblower who uncovers the ruse
or where the deals go badly wrong and all involved parties are out seeking
blood. The authorized dealer in question in this case not only illicitly sold Rolex wristwatches in
secondary markets, but he also did so with other popular brands like Patek Philippe. Selling to
grey markets is evidently where and how these authorized dealers are able to make the largest
gains, with this necessarily implying that customers seeking to identify with the luxury
brand get more ripped off in these markets than when they are sold to the authorized dealership
where many dealers now customarily sell at prices way beyond Rolex's recommendation.
But while authorized dealers also commonly sell above-recommended prices at their official
dealerships, the clandestine manner in which such deals are conducted makes them nearly impossible
for Rolex to independently identify. But the question of the possible role of customers in
this scheme also arises? Could desperate Rolex customers also have blame in all of these,
especially as these dealers are only able to rip them off with their connivance?
What's become evident from the situation is that these fast-spreading rip-offs are primarily
borne out of customers' desperation to collect a piece of the luxury brand’s bespoke collection.
An increasing number of Rolex customers also appear to be showing a preference for buying
on the grey market to avoid decades-long waiting lists, especially for rare models.
Rolex’s rules on product sales for its authorized dealers specifically state that the dealers must
“sell the Rolex products in a manner consistent with the high standards,
goodwill and prestigious reputation of the Rolex name.”
Many authorized dealers do not only flagrantly flout this policy in their attempt to rip
customers off, but they also appear to be flouting a much wider set of rules. Another increasingly
famous practice among authorized dealers is that as against the clause in their binding contract
with the brand that stipulates that they would acquire new Rolex products exclusively from Rolex,
an increasing number of the authorized dealers are now sourcing wristwatches on grey markets
and reselling likewise on the same market for very exorbitant gains.
Asides from authorized dealers constantly charging customers more than recommended prices
via a series of discrete transactions involving exchanges at higher than usual amounts,
Rolex can also not force these retailers to not charge more than the retail price.
Every authorized retailer knows that they run the risk of having their contract with the brand
canceled if caught and that Rolex doesn’t like it if they do it. The only tool Rolex has to combat
these irregularities especially with consistently deviating retailers is to cancel the retail
agreement with them. It is the strongest tool that Rolex has, and it has used it many times.
Still, the menace remains and Rolex customers across many authorized dealerships continue to be
ripped off by retailers seeking abnormal gains. Even as the prices of Rolexes remain low in
the market, the brand's authorized dealers are continuously seeking ways to make high profits
and quote higher than recommended prices for a growing number of Rolex customers
who are wealthy or desperate enough to close a deal. Rolex is completely in the know of
these second-hand dealings but appears to be largely incapacitated by existing local
laws in many nations and by the ingenuity of dealers who engage in these unlawful trades.