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Rolex Says Shortage Of Product Is Not Deliberate September 27, 2021 (0 comments)


Geneva, Switzerland—Like many products ranging from cars to coffee beans, many Rolex watches are in short supply these days. But while scarcity drives up the value of luxury products, the company issued a rare statement denying that it’s an intentional strategy. 

While sales of luxury watches dipped during the height of the pandemic in 2020, sales have not only rebounded but also increased: figures from Swiss watch industry research group FHS show Swiss watch sales were up 7.6% in July compared to 2019. Sales growth jumped a whopping 48.5% in the U.S. in July compared to 2019 levels, and even 75% in China, says this report.

But Paul Altieri, CEO of online watch retailer Bob’s Watchestold Yahoo! News that Rolex scarcity was an issue long before COVID-19. The pandemic’s impact on global supply chains exacerbated the problem, he said, but it didn’t cause it.

“Global demand has steadily increased the last five years, and supply has kind of stayed constant, it’s a classic supply-demand situation going on,” he told Yahoo! News in an interview, and this puts an “upward pressure on prices.”

In the same article, renowned watch blogger Ariel Adams said that while Rolex has adamantly refused to increase production to meet growing demand—ensuring the brand retains its long-term value—the pandemic created a perfect storm that both scrupulous and unscrupulous players are using to advantage.

For instance, authorized dealers sometimes ask customers to purchase a less-popular model first before they’re put on the waiting list for a coveted model, says the article. While some might look askance at the practice, it’s not illegal. Meanwhile, unscrupulous dealers will sell the coveted models above cost to a gray market dealer, who then sells them to consumers at even higher cost.

Like the practice long familiar to diamond sightholders, Rolex dealers don’t know what models they’ll get in their shipments, but they are responsible for selling them, one way or another.

After the Yahoo! News story came out, Rolex issued the rare statement saying the scarcity of its popular models was not deliberate. Here is the complete statement:

“The scarcity of our products is not a strategy on our part. Our current production cannot meet the existing demand in an exhaustive way, at least not without reducing the quality of our watches – something we refuse to do as the quality of our products must never be compromised. This level of excellence requires time, and as we have always done, we will continue to take the necessary time to ensure that all our watches not only comply with our standards of excellence, but also meet the expectations of our customers in terms of quality, reliability and robustness. Rolex does not compromise on what it takes to produce exceptional watches.

All Rolex watches are developed and produced in-house at our four sites in Switzerland. They are assembled by hand, with extreme care, to meet the brand's unique and high-quality standards of quality, performance and aesthetics. Understandably, this naturally restricts our production capacities – which we continue to increase as much as possible and always according to our quality criteria.

Finally, it should be noted that Rolex watches are available exclusively from official retailers, who independently manage the allocation of watches to customers.”

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