Profit Margin on PP

Anyone know the approximate profit margin.n on Patek watches for the dealer? Assume MSRP. Thx

 

I would expect % profit margins to vary greatly between models. A simple Calatrava certainly doesn't have the same % margin of a tourbillon minute repeater

 

I agree, and would guess the margin comes down as the price goes up. Don't know if it goes from 50% on the Calatrava to 30% on the repeater though.

 

Lots of lines are at 36 now.

 

My best guess is between 30 and 40 percent. Of course, it depends on the material...

I can get 30% off Rolex watches all day - I was told margin is around 40 percent. Sorry I can't be of more assistance!

I am beginning to yearn for a simple PP Calatrava now that my Rolex collection is complete!

 

Uh huh....

 

That's not an unreasonable discount for a gold Rolex. Probably not the SS.

-dsd

 

Correct, thank you. I get 30% on gold, 25% on two-tone, and 20% on Stainless, with the obvious exception of my new SS Daytona with the white dial, where I got a whopping ZERO percent discount.

Sorry for the late clarification.

There was a time when I could get 30% off on PP, but that was when the economy was in the can back in 2008.

 

20% off SS seems pretty good to me. I have not heard that deep before. However, I don't have strong AD ties and don't really price Rolex often.

 

What is a new PP Calatrava? Last I looked it was ~8500. I'd guess around $10,500 now?

Honestly, I think that is too much for what you get. Then again, I'm a Lange guy not a PP.

 

That's why I said what I said. Dealers aren't willing to risk losing the lines for the occasional sale to bottom feeders.

 

Correct, I have bought well into the six figures in Rolex alone from my AD. Plus, he sells nice pieces to me at a good price since he knows I don't flip them. I either buy them for family members or for myself. I've never sold a watch I have bought, and no family member has ever (or will ever) sell a Rolex I have gifted to them.

Look, these discounts aren't smoke & mirrors, they exist between the right buyer and seller. You can choose to believe what you want - I have no reason whatsoever to fabricate my point.

 

I'd agree with that.

I got a little over 30% on my wife's gold Yachtmaster from an AD. I'd never get that on a SS Daytona.

 

The average margin on Rolex is nowhere near 40%. Not even half of that.

An authorized Rolex dealer can correct me.

Matt

 

Can you please substantiate this claim? Are you suggesting that the profit margin on a Rolex is less than 20%? This should be interesting, because it implies I have gotten all of my Rolex watches at or below cost. Wow, I should buy a lottery ticket!

 

My info comes from a friend who is a Rolex dealer.

Ask your dealer what his average margins are on Rolex, Raj.

Matt

 

I hope you can understand why this is hard to believe. Rolex has contracts with their authorized dealers - in those contracts they discuss terms of selling the products at discounts (I have not personally reviewed this contract - it's not my place or my business). It isn't unheard of for Rolex to pull a line from a dealer who sells on terms not favored by the legal agreement - I have seen this with my own eyes in my hometown. Conversely, the discounts I have shared come from my relationship with one of the largest Rolex dealers in my state (by volume). So, I have a hard time swallowing this one - I'd be getting watches regularly below cost and I can't imagine that sits well legally. He also told me he'd never offer me a discount that jeopardizes his contract with Rolex, and I believe he has held to that.

I'm not sure if we're talking about the same thing - you had mentioned "average margin" in your post - I am referring to gross margin. Perhaps your dealer contact is referring to the margin after discounting? Everybody knows Rolex prices are negotiable, so I'd imagine they're probably giving away 5-10% to any warm body that walks in the door.

We're OT - the OP asked about Patek, and I took it to Rolex. Sorry about that. The OP had said to assume MSRP, so I believe he was referring to gross margin.

 

You're right, Raj. I am talking about after discounting, not off retail price.

Matt

 

I'm not saying you were. I just know and have worked with a lot of AD's and they don't jump through hoops or take risks for one off buyers, and why should they?

Favors are a different story, as you know.

 

Most swiss watch companies use to have a 50% margin with Rolex and and a few others at 40%. Now most are at 40% or less. Rolex will tolerate a 10% discount at authorized dealers Anything more on a consistant basis and they will pull their product

 

Makes you wonder where price fixing laws come into all of this.

 

This explains what you wonder:
Resale price maintenance - Wikipedia, the free encyclopedia

 

Agreed.


Jewelry equals 100 % market up, plus. Watches too.

 

I'm not going to argue the point. I have a friend who is an authorized dealer. His margins on Rolex are lower than anything else in his store.

I ask again for another Rolex AD to disagree.

Matt

 

There are other brands that used to be 50 + 20 that are now at 35 but Rolex was a trendsetter at that margin.

I bought my R/G Portugiser directly from the (then) President of IWC for 50/20 but even I can't get that now.