by John Keil
Though this cautionary example of buying a new watch online is not new, with the current influx (or perhaps “flood” is a better word) of grey market watches to mainstream channels it’s perhaps more poignant today than ever before.
Know who you are buying from before you put your money down!
I probably don’t need to preach that well-worn refrain if you’ve been reading Quill & Pad for a while, but it’s always good to hear again: buying watches through unauthorized channels has its risks. Having worked directly for a brand as a national sales manager, then managing an authorized retailer of more than 20 brands, I’ve seen a lot of crazy stuff with regard to watch sales.
One story stands out for me, and in retelling it I hope it helps you know what you’re buying and how to avoid being misled.
Your homework today is to read this!
Back in 2005, I was working with the wife of a good client who was looking to buy her husband a special watch for a big anniversary. Knowing his taste as well as his current collection inside and out, I’d helped her narrow down her decision to an awesome piece: the Ulysse Nardin Marine Aqua Perpetual Limited Edition.
It was stainless steel with a white gold bezel and a stunning blue enameled dial and bezel inlay. Making it even more special, it was limited to 500 pieces worldwide and had been out for almost two years by this point. The model was all but sold out; there was one remaining brand-new example at the Ulysse Nardin headquarters in the U.S. at the time that I knew of.
Ulysse Nardin Marine Aqua Perpetual Limited Edition
When the client and his wife came back to tell me that they had found a better deal online than I could provide, I was a naturally little bit concerned about not making the sale. But my greater concern was protecting my client and looking out for his best interest.
I asked my clients for a favor before I returned their deposit: to call the online contact they spoke with and ask a few questions first, including whether the watch was brand-new and if so what was the serial number. They did that and the answer was yes, the watch was new. They also learned the exact serial number.
With that information, I dialed my Ulysse Nardin representative on speaker phone for my client and his wife to hear. Without explaining the scenario at hand, I asked the rep to do me a favor and research this particular watch with its serial number. I told him that I simply needed to know if it was a watch sold through an authorized retailer in the United States.
The answer that came back on speaker phone was, “Yes, this watch was sold to one of our authorized retailers about 19 months ago and it was sold very quickly afterward to a client.” I thanked him for his help and hung up.
I looked up to find Chuck and his wife staring at me wondering how this online retailer had the watch and why he’d been advertising it as new.
I told them that it was quite simple: Ulysse Nardin had delivered to its authorized retailer. The retailer sold it to a client, who wore it for a year and half. The client then proceeded to sell or trade it in to this online retailer. Where it got crappy is that instead of the online retailer selling it as a pre-owned watch, he lied and advertised it as new.
Needless to say, my client ended up with the watch brand-new from me. He never considered buying watches from anywhere else again after that. Lesson learned.
How can this story help you?
- Know who you’re buying watches from. Reputation is all anyone has in the watch industry!
- If you’re buying a new watch, buy from authorized retailers. It is the only way to guarantee that you are getting what is advertised.
- If you’re buying a pre-owned watch, don’t be afraid to ask questions. Find out the model and serial number and contact the brand for further information.
- If the deal seems too good to be true, trust me, it probably is! For peace of mind, when buying an expensive timepiece, spend the extra few dollars to get it from a trusted channel.
- Don’t be afraid to contact me here or put a question in the comments. We are always willing to offer our best advice to keep you safe and we aren’t affiliated with any brand or store.
What’s important to note is – like many brands these days – Ulvsse Nardin’s watches must be registered through their website once purchased from an authorized retailer.
Going forward, Ulysse Nardin (and, again, many other brands) have detailed accountability for each watch and will be more than willing to help you, the client, either directly or through its authorized retail network.
Quick Facts Ulysse Nardin Marine Aqua Perpetual Limited Edition Reference 333-77-7
Movement: automatic Caliber UN 33 with patented perpetual calendar mechanism settable backward and forward; officially certified as a chronometer by the C.O.S.C.
Case: stainless steel with white gold bezel, 42.7 x 12.7 mm
Dial: blue enamel
Functions: hours, minutes, seconds; perpetual calendar with large date, day, month, year
Limitation: 500 pieces
Price, new in 2003: $24,800
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Hi, a quick question! I am considering buying a Tudor from Jomashop.com. Do you have any previous experience/ knowledge about that website? Thanks!
I bought a Oris 65 Diver At Joma and has no situations. My experience was good.
I bought an “unworn” (new) watch from Jomashop and it stopped working after a few weeks. It had been sitting and passed from retailer to grey market for years while the oils inside dried out.
Buyer beware.
The trouble is, of course, that, with current massively inflated prices, buying at an AD usually costs mucj more than ‘the extra few dollars’!
Nah. Sorry. This is not up to Q&P’s usual very high standards of journalism.
You are asserting two things as fact here, without any evidence for either of them.
Firstly, you state the watch was sold by the authorised retailer to a client.
What evidence do you have that this client wasn’t the grey market dealer? You certainly don’t present any. And let’s be honest now – everyone knows this goes on all the time.
More importantly however, you state that this alleged client “wore the watch for a year and a half” before then selling it on to the grey market dealer.
Even if one is to give you a pass on the first question, there is absolutely no way you can make that statement based on any facts. For all you know, the initial customer may have bought it and never worn it at all.
A disappointingly disingenuous article that one has no option but to ponder the motivation for it.
Yes. Caveat emptor. Always. But please, treat your readers’ intelligence with a little more respect.
If you are so sure that the facts you present are absolutely correct, name the grey market dealer.
I would like to support every word written.
Maybe I have been lucky so far, but I had never a problem with a watch bought on the grey market (and this after being willing to buy from an AD/manufacturer boutique but being treat like an idiot by clueless and disinterested sales persons). This included hand delivery from the Ukraine… I always got the full set and of course papers stamped and dated by an official dealer of the brand. Registering with the manufacturer for an extended warranty brought no problems. And if manufacturers of hand-made watches of the upper league supply them to WatchUWant and others, you get factory fresh beauties at roughly a third of the retail price, even if they are advertised as “pre-owned”, for whatever reason.
While you get always superb service at places like the PP Salon in Geneva (or I recently in the Chopard Boutique also in Geneva), most of the time your intelligence is insulted by the unbelievably low standards of the sales personal even in factory boutiques, at least here in Switzerland. Why should you pay the considerable sums of a 40-50% margin on the more expensive watches for such non-experiences?
Bruno
Bruno,
I think it is less luck and more that you’ve utilized caution, done your homework, and found a gray market dealer who is reputable and takes good care of you.
My post wasn’t supposed to be a rebuke of the gray market, more of a caution as to what to look out for when purchasing brand new watches online.
I am curious, though, how you would be able to register a watch on a brand’s site and receive an extended warranty when to the best of my experience, you must provide where you’d purchased the watch. I’d be interested to know what brands allow this.
John,
sorry, a small inaccuracy on my part: registration for extended warranty (if offered) was by letter (and in one case done by the grey marked dealer!) and registration as owner was via internet. The factory warranty is honoured in Switzerland as long as the originally stated (or extended) date is not yet expired. The factory warranty is transferable; all you need is an AD stamped and signed warranty card. And with two independent brand watches bought on the grey market I had direct contact with the manufacturer for straps etc. and openly mentioned where I had got the watch from. There was no change of amicable treatment when they knew it…
Bruno
Hazem, I get this question a lot!
It is my personal belief and habit to always go through authorized retailers for many reasons. With that in mind, I always tell people to weigh your options. Find out from an AD or two how much they’re willing to sell it to you for. Between the prices offered and the online price you can decide if the online savings are worth not going through an Authorized Retailer.
The one thing that I’ll caution you is that if you don’t purchase through an AD, the brand won’t touch your watch for repair, service, etc.
Either route you go, congrats and good luck!
John
Not true about the last point. Brands WILL DEFINITELY take care of your watch and honour any kinds of warranty regardless the channel of purchase.
Not under warranty. They require a stamped and dated warranty card from an authorized retailer. More commonly, recently the watches must be registered online through the brand’s website and they’ll offer an additional year warranty for doing so.
If you’re saying that you can purchase a brand new watch from a gray market retailer without the stamped and dated warranty card, send the watch in for service and they’ll do it under warranty with no charge, it’d be the first I’m hearing about it and in my 17 years in the industry have never experienced it happening.
Don’t MB&F currently offer a 2 year warranty for any watch, regardless of age, and how it was acquired, if the current owner registers it online?
Something that should absolutely be applauded BTW.
You may be correct. I haven’t had the pleasure of doing business with them so I couldn’t be sure.
One thing that makes a company like MB&F, as well as Richard Mille, Louis Moinet, and other very high-end boutique brands, unique is that they make very few watches every year and because they don’t over-produce just because they can, the demand for their product remains very high, therefore the brands themselves as well as their international distribution and retail network don’t supply them to the gray market often (or at all). Retailers sell most of these types of brands at or very close to the MSRP so they have no incentive to sell it at discounted prices to the GM.
I suppose it is for this reason that MB&F and others offer warranties that transfer from client to client regardless of where it was purchased.
Gerald, sorry to have disappointed.
You’re correct, the sale of watches from ADs to GMDs does happen regularly. When it does, it is because the GMD has every watch from every brand listed at 30-35% off msrp and “ships in 7-10 days.” When a watch is ordered from a GMD, they call an AD with whom they have a relationship and purchase the watch at 10% over the AD cost. In this case, the watch discussed had been on their site for a few weeks at a price lower than retailer cost. It makes no sense that an AD would sell a watch for lower than their cost to a GMD to have it show up a year and a half later as BNIB. So in this case, yes, it was in fact pre-owned.
With regards to it being worn for some time, I concede it is certainly possible that a client paid good money for a watch, kept it in the box and never wore it, then sold it to a gray market dealer for a hefty loss. My bad.
With regards to the motivation, ponder away. But if you’d asked I’d have said that I write this and many other posts with the sole motivation of educating and entertaining. I’m not in wholesale nor in retail any longer, so there’s nothing to be gained.
Naming the gray market retailer? First, I honestly don’t remember which one it was since it was 12 years ago. Second, even if I could recall I wouldn’t call them out by name publicly simply because I have no interest in getting into a pissing match with an online gray market retailer worried about their reputation.
Woah. Hold on a moment.
This is now getting extremely interesting.
Here is what you are claiming –
1. Authorised dealers sell to grey market dealers all the time. Thanks for validating that. This needs to be out in the open and customers need to know about it.
2. Authorised dealers sell to GMD’s at 10% above their cost price.
Given your clearly extensive experience on this subject perhaps you could be so kind as to offer an explanation for the following –
If authorised dealers are happy to sell watches to grey market dealers for 10% above their cost price, why are they not offering the same deal to their “regular” customers?
Great questions Gerald. I will do my best to answer them efficiently, but so you know, I plan on writing a comprehensive post on the subject of the Gray Market in the near future that you’ll find here on Quill & Pad.
Answer to Q1 – I agree that the industry should become more transparent. Maybe if it were, it wouldn’t be in the dismal shape it’s in right now. Not all retailers sell to the gray market. On the contrary, it is only a very few of them do. Why they do it will be addressed in my future blog post.
Answer to Q2 – The reason they will not extend the same pricing to their “regular” customers is that it wouldn’t make any business sense. They’ve got rent, utilities, payroll, insurance, security, and store appearance to pay for and the small margin would easily have them operating at a loss. Again, the reason they do sell to the GM will be addressed in that post.
John your last comment says a lot about the state of the watch industry. It’s outdated and without the grey market dealers keeping inventory levels in check things would be a lot worse. It’s time to recognize this and create a new buying experience with less overhead. Small boutiques and dealers bad mouthing the grey market these days is silly when the consumer knows better and leaves a bad taste in everyone’s mouth. Time to move forward into a fair but transparent marketplace.
And here is where the word “transparency” comes into play, “Sleepy.” I truly think that if the grey market is here to stay (and the fact that the brands/authorized retailers feed it more than ever before right now makes it seem so), it’s time to really talk about it in the open from every side. I do not feel anyone here is badmouthing the grey market in general; John’s goal (and mine) was to make it clear that not everything is as it seems every time and that doing one’s homework is essential….This is an element that sorely needs to be fixed for the grey market to be viable in a transparent way. Or better yet, why don’t the brands just adjust to real market conditions?
Great discussion here. I’ve purchased from both AD and GMD and still hold my breath each time regardless. This running post is insightful.
Hi, this is an excellent idea to buy new watches online. Love this.