Why Is There A Shortage Of Rolex Watches?
There is a shortage on Rolex watches for many reasons but the main two simply are due to supply and demand. Rolex is by far the most popular watch brand so naturally demand will be high. The interesting thing with this situation is that Rolex appears to not be interested in matching supply with demand.
This has been a source of frustration with Rolex buyers for many years. One would think that the next natural progression to end the Rolex shortage would be to invest in more manufacturing but that hasn’t happened. The result of this inaction has lead to acquiring Rolex a competition between buyers across the world.
If you are wanting to know how to get the Rolex you want at MSRP, check out our article Tips On Buying A Rolex.
We should give credit to Rolex and I don’t think I blame them for not taking action even though I wish they would invest in more manufacturing to end the Rolex shortage. Credit is due to the quality of the product they make. All the reasons why people don’t like Rolex has nothing to do with their watches, it’s all their business practices.
Results Of The Shortage Of Rolex Watches
What isn’t helping is that Rolex authorized dealers fully understand the shortage in Rolex inventory and use it against their customers. How the ADs play this scenario to their advantage is quite simple. They only sell the most popular models, most often stainless steel sport models, to their best customers or ones that will buy watches in bulk purchases to get the one they want. Doesn’t sound like a quality buying experience but don’t blame them for continuing this practice. If buyers stopped falling for it, it wouldn’t happen but because the practice continues it shows how extreme the Rolex shortage is in the market.
If you aren’t lucky enough to buy the Rolex you want new at MSRP you’ll almost certainly pay over retail on the pre-owned market. All of this has to do with access and limited inventory. Because there is so much competition between Rolex buyers, pre-owned pricing are skyrocketing. In some cases models command 100%+ over MSRP all due to the shortage of inventory for Rolex watches. The Rolex GMT Master II Pepsi or The Rolex GMT Master II Batman are a great example.
These results have made the brand unattainable for some buyers and for others unattractive. It’s a shame really because Rolex produces such a great product.
When Will The Rolex Shortage End?
Unfortunately we don’t see the shortage of Rolex watches ending anytime soon. That doesn’t mean that Rolex isn’t making steps to improve supply. We now have most of the collections sharing the same movements which will make room for more efficient production. Their sister company, Tudor, has also been making improvements and investments in their production so Rolex might have the opportunity to free up more space for their production and let Tudor branch more out on their own.
Rolex is aware that there is a major shortage of their watches given the current demand. What I expect over time is a slow shift to increase production, moves that will be best long term instead of short term.
Which Rolex Watches Have Been Effected The Most By The Shortage?
Stainless steel sport models have been effected the most most by the Rolex shortage. These are the references that don’t even hit the case at authorized dealers and command the largest increase in value on the pre-owned market.
Check out our article Will Rolex Produce More Stainless Steel Sports Models? for our analysis if this will happen.
Many want Rolex to shift production from other models to the stainless steel sport models but that seems like something Rolex is unwilling to do. I understand their rationale. Rolex is a luxury watch brand and to abandon precious metals or limit their collections to a few would be a giant mistake.
Long Term Outlook On The Rolex Shortage Of Watches
Rolex is methodical and calculated in their decision making. What that means is that it takes time for decisions to be made and also implemented. What is encouraging about this is that we can be confident whatever changes they do make, it will most likely strengthen the business and supply. It may be years before we see improvements but once we do they will most likely satisfy what we’ve all been wanting for the last couple years, the shortage of Rolex watches to end!
