FEATURE: The Rolex Steel Sports Situation

I don't, and I have never owned a Rolex. I don't think I ever will either to be perfectly honest... and the more I hear about them the less I think I would want to. But you can't be interested in luxury watches and not take a passing interest in the brand, and you have to admire the way they have elevated themselves right to the top of the watch tree, whether it's fully deserved or not.

So if you watch videos by the likes of CRM Jewellers and Archie Luxury or frequent watch forums you'll probably be aware of the shortage of steel sports watches that is afflicting the Rolex fan at the moment. I don't usually pay much attention to Rolex, but a few weeks ago I was passing Goldsmiths and looked in the window and noticed that it was true. There was a decent number of watches in the window, but almost every single one was two tone. I can't remember now if they even had one steel watch, they may have but it was something fairly unexciting like an Air King... they certainly didn't have any Submariners or Daytonas that's for damn sure!

And this is seemingly the case everywhere. I read a post the other day on a watch forum where a guy was in Heathrow airport and wandered into a Rolex boutique to kill some time. This guy had bought Rolexes in the past and making conversation with the salesman he established that they had a couple of different steel watches in their safe that he wanted to buy. Now, as you may or may not know, at the moment you can't just walk in to a shop and buy a (popular model) steel Rolex, at the very least you will need to be able to prove that you have bought from an AD previously.

So the first question was 'are you on our system?' It tuned out that he wasn't, which wasn't a good start. So they asked if he could prove that he had bought their product from an AD before. Given that he was in an airport this was a bit of an ask, but he phoned his wife and she managed to find a receipt and sent it through. This satisfied the salesman and he rang his manager who was off site at the time to get the okay to sell the watches. However, the manager refused to let him process the sale because 1) the customer still wasn't on their system already, and 2) they couldn't establish for certain that he was a big spender. Eventually the guy gave up and left after having wasted an hour of everybody's time.

Sure, you shouldn't believe everything you read on the internet, but this is by no means the first thing I've read from people left frustrated in their dealings with Rolex ADs. The thing is, I just don't get how this is helping Rolex. Okay so you cut production and create 'demand', but they seem to have taken it too far. What's the point of creating demand unless you are going to satisfy it at some point? And how is this good for the ADs? According to Roman Sharf of Luxury Bazaar, ADs have to buy a load of pieces they don't want to qualify for steel sports watches and they can't sell them over-list to their customers so instead they sell them on for +50% to a reseller, who then puts another 10-15% on the price and hence you get the ridiculous situation we are in now.

Furthermore, Archie Luxury recently reported that some AD's were willing to sell watches 'at list' providing the customer was prepared to offer a substantial 'tip', essentially playing the system and selling over list while hiding what it was up to since the bill of sale would only show the list price being paid. Again, you shouldn't believe everything you hear, but it's not hard to imagine this situation arising, in fact you could well imagine this situation being initiated by a well heeled and deeply frustrated customer!

I can't help but think that if Rolex was a listed company (Rolex is actually a 'charity' believe it or not) this would not be allowed to happen. Why would shareholders put up with demand going unsupplied? All it's done is to artificially inflate the prices of pre-owned pieces, but again how does that help Rolex themselves? I don't get it. They are already by far the most famous and prestigious watch brand out there, how does making their watches more exclusive help them? Do they think that this will help them shift their two-tone and gold pieces? Because I really don't think it will.

Given that Rolex are actually a very secretive company, is it possible that there is some other undisclosed reason why this is happening? Rolex make a lot of their own components and even their own steel, so is it perhaps possible that there is some problem somewhere down the line that is causing this shortage, but in the absence of any word from Rolex people are just putting it down to the company 'cutting production'.

Maybe that's a long shot, but whatever the reason, surely this can't go on too much longer without the company risking a backlash of some sort. But then Rolex fanboys are a peculiar breed, it seems that far from being annoyed by the company's way of operating they just suck it up like some sort of collective masochism and accept it as the cost of being one of the chosen people entitled to own a Rolex.

I don't get it, and to be honest I don't get the watches either. So while I'm sure I would get short shrift in a Rolex AD, I'm not sorry. To be fair, I suppose the ADs are stuck between a rock and a hard place. They're short of stock and thus missing out on sales, which must be incredibly frustrating, no wonder they sell their stock on to the highest bidder. I've heard for instance that as a rule a Rolex AD will get an allocation of two steel Daytonas per year. Two. It's ridiculous! And yet, the ADs are terrified of losing their AD status. What a bizarre situation...

Kinda makes you glad you don't want one. At least I can get pretty much any TAG Heuer I want as long as I can afford it!