IN FOCUS: The demand for luxury watches in Singapore and why collectors are turning to the gray market
SINGAPORE: It took Mr Jay Tun nearly two years of brainstorming before buying his first luxury watch in 2018.
The S$16,480 Rolex Sea-Dweller, which is still in his possession, started him on a journey that was “hard to stop”.
The 35-year-old has since spent over S$300,000 on these watches. He now views his watches, now valued at around S$400,000, not just as a passion, but also as an investment.
“I don’t just like watches for their value. I love watches for the different movements, the different subtleties of the movements themselves. It’s very intriguing… It’s like art to me,” he explained.
“Whatever purchase I want to buy, especially for watches, the numbers have to make sense first. But of course the piece has to be something I love.
For luxury watches like some of those Mr. Tun collects, demand far exceeds supply. Watches from brands such as Rolex, Patek Philippe and Audemars Piguet are among the most popular.
Buyers cannot just walk into stores and purchase these watches. There are usually long waiting or interest lists, especially for popular models, watch dealers and collectors said.
Mr Jarod Ng, co-founder of retailer Watch Capital which sells new and used luxury watches, said many people find the waiting time too long.
“Let’s just say you want to buy it as a wedding anniversary gift or you want to buy it for your son as a graduation gift. You can’t wait two years when he graduates within six coming months,” Ng said.
Getting your name on the list in no way guarantees you a watch.
“With the authorized dealer, I think a lot of people have the same frustration I did. You go there and they’ll give you the standard SOP (standard operating procedure) – that it’s a highly sought after part, there’s has this interest list,” Mr. Tun said.
“If you don’t follow up, if you don’t buy anything from them again, you’ll probably never hear from them again.”
Even VIP customers have to wait a few months for a watch of their choice, said Mr. Tan Khai Hsiang, who runs an online store on Carousell called KHF Watch.
Mr. Tan started as a watch collector himself and started buying and marketing luxury watches in the e-commerce market in 2019. He also buys watches overseas on behalf of other dealers at Singapore.
New customers are often told the watches they want are out of stock, so they turn to the gray market, Tan said. The gray market is made up of retailers who are not officially authorized by brands to sell their watches.
Mr. Tan likened the process to buying an exclusive bag like the Hermes Birkin. “For normal people, it’s unobtainable,” he said.
Mr Charles Lee, founder of Good Time Luxury in Far East Plaza, said it had become more difficult to obtain watches amid the pandemic as customers could not travel overseas to purchase them.
“Even if they come into stores, you can’t get the popular models. You can’t get the Rolexes, the shelves are empty. That’s why people need to buy from gray dealers like us. »
And some customers don’t mind paying more to get what they want right away.
The most popular brands and models can cost 20-30% more on the gray market, while some can be almost double the retail price.
CNA’s checks of authorized dealer websites revealed that an entry-level Rolex Submariner model is listed for around S$12,000. On Chrono24, an online marketplace for watch buyers and sellers, the same model costs around S$22,000.