Buyer's Guide to Fine Wristwatches
Get the most out of your purchase by understanding fine wristwatch value, resale, and buying from various sources
- What is the point of spending so much money on a watch?
- Why would I want a mechanical/automatic watch when quartz is more accurate?
- What is the real reason why mechanical versions -- even of the same watch -- are more expensive?
- Which watches are collectible?
- What is and is not important when choosing which NEW watch to buy?
- What does a COSC certification or Chronometer rating on a watch really mean to me?
- I am worried after reading on the Internet about some people having a problem with the watch I'm thinking about buying.
- What are the real advantages and disadvantages of buying from authorized dealers?
- Watches with a good resale value are a good investment, right?
- Watches not a good investment? But many classic watches sell for far more now than when new!
- So what makes a watch have good resale value?
- Why is the warranty sometimes longer depending on where you buy the watch?
- What does it mean when someone sells a watch with an 'open warranty' or 'open papers?'
- What are 'gray market' watches?
- What about fake, replica, look-similar, and counterfeit watches?
- What should I know about buying NEW watches from Internet dealers?
- What should I know about buying watches on Internet auctions and 'for sale' boards?
What is the point of spending so much money on a watch?
"Time is an illusion. Lunchtime doubly so."
The Hitchhiker's Guide To The Galaxy.
There has long been elegance and prestige associated with a fine watch made with
precious metals and jewels. Originally, finely crafted, precision mechanical timepieces
also served a serious need in accurate timekeeping needed to facilitate travel
and communications across moderate to significant distances.
But now, technology has made it possible to have an accurate wristwatch as the free
toy in a fast-food kid's meal. Yet the aspects of watches as fine functional jewelry
with poetic and nostalgic ties to their origins remain. I'm sure others can better
describe and explain the value people find in owning and wearing fine jewelry.
What it really boils down to is this: any wristwatch over US $200 is more jewelry
than a timepiece. So forget about evaluating such items by adding up the cost of
components, factoring in the value of precious metals or imagining some supreme value
hidden in the mechanism inside. That takes you on a slippery slope to the insanity of
people who argue over technical specifications they don't truly understand, trying to
intellectually justify wristwatch values for technical and logical reasons that hold
little, if any, tangible merit or benefit.
Since an inexpensive quartz watch will look fine on your wrist and tell you the time accurately,
there is no real functional value to paying more for a watch. Choosing a timepiece that
accomplishes the same function using a more complicated older mechanical technology, a
premium quartz technology that is marginally more precise, in a casing with highly refined
detailing or of precious metal, or bearing the design hallmarks of a famous maker are all
values that exist only to bring personal and intellectual satisfaction and enjoyment.
In other words, jewelry value.
The truth is that the value of jewelry is entirely emotional. Any penny spent over
$200 on the price of a watch is buying you only more jewelry value and greater emotional
satisfaction in having something more unique--nothing more.
Why would I want a mechanical/automatic watch when quartz is more accurate?
Simple. Quartz is clearly better on accuracy. But there are many other advantages and pleasures
from wristwatch ownership beyond just measures of precision levels that are beyond the notice of
Frankly, quartz watches and many other technologies don't really do anything significant to
better people's lives. People with quartz watches are no more reliably on time than people
with mechanical ones. People driving cars with manual or automatic transmissions still get where
they are going equally well. People still enjoy music about as much as they used to, even
though CDs play it more clearly that tape or LPs did. You are not likely to have any smarter
thoughts simply because you wrote them down with a computer than with an ink pen. You can easily
spend as much time playing golf or football on an accurate computer simulation game as on a real
playing field, but the experience is not any more fulfilling at the end of the day. And you can
certainly do a lap around the lake faster in a speedboat than in a rowboat, but what have you
The newer technologies often gain a level of efficiency that makes them... uninteresting.
In many cases, the older ways and technologies were more than sufficient, and it is their minor
failings that give variety and character to doing things that way. With the older ways, you
usually have to be more aware of details, understand more of what you are doing, and take more
time being involved in the process. That greater interaction makes the process more personal and
enjoyable for some people.
With the newer ways, you can be pretty assured your quartz watch is on the right time, your
car's automatic transmission won't miss downshift on the way home, your CD will play exactly the
same as it did yesterday, your computer will catch and correct your typos and misspellings,
your video game won't stop in the middle because of rain or a player injured in a tackle, and
you certainly won't be bothered seeing much of the detail and wildlife on the lake at high speed
from your motorboat. How boring.
Mechanical watch enthusiasts often compare the movements, the finishing, the level of adjustment,
types of certifications, performance under different circumstances and other esoteric measures of
Quartz watch enthusiasts compare... mostly accuracy measures.
So if efficiency is your main desire, then quartz is for you. If you are tired of efficiency and
want something interesting instead, try a mechanical watch.
What is the real reason why mechanical versions -- even of the same watch -- are more expensive?
You will often find mechanical and automatic watches at a significantly higher price than a
comparable quartz model. In some cases, a manufacturer will even offer the identical watch with
your choice of a mechanical or quartz movement. The mechanical watch will be more expensive.
Some people will tell you it is because the mechanical movements are highly refined, others that
mechanical movements are very expensive and quartz very inexpensive. Most of that is baloney or
exaggerations. Here are the real reasons why.
- Cost to Manufacture: The high quality quartz movements used in better luxury watches
are slightly cheaper to make than their mechanical counterparts, though the
difference is not that great. Keep in mind that cost of the movement in most
luxury watches accounts for only a small portion of the final retail price -- less than 5%.
- Warranty Service: Since there is almost nothing to go wrong with a quartz
movement, warranty claims for quartz watches are very small. Mechanical movements are
more likely to incur an in-warranty service, so that cost is factored into the price.
- Distribution: Mechanical movement watches are sold in much smaller quantities,
so have less economies of scale in the distribution system. While collectors and
enthusiasts often prefer mechanical watches, the general public still predominantly
buys quartz. So mechanical watches do not turn over in inventory as fast as quartz,
causing the manufacturer and dealers to have a somewhat slower return on their investment
in stocking them.
- Exclusivity: As with virtually all jewelry -- and don't kid yourself, any
wristwatch over US $200 is mainly jewelry -- there are premiums you pay for certain above
average features. Precious metals, synthetic sapphire crystals, mechanical movements,
advanced timekeeping modes (complications) and precious stones all are at significant
premiums over their mere cost.
Which watches are collectible?
The whole concept of specific watches--or anything else--being "collectible" is a falsehood.
People become mindless lemmings because of some mystic significance to items being called
"collectible." They hear things called that and go out and spend money because they blindly
think it is a good thing to buy them. There is a broad public perception that things that are
labeled "collectible" are good investments--when in most cases, they are far from it.
Beanie babies are a good example. Trivial little toys that ought to cost well under $1, yet
people pay outrageous prices in the tens to hundreds of dollars to get them to complete the
collections they feel compelled to build. If you ever wish to get your money back out of this
'investment,' you have to find someone even more driven by the collectibility craze than you
to sell it to.
The latest form of this collectibility craze began back in the 1970's or so when people started
discovering that some items they or their relatives had gathered over the years were suddenly
in demand by buyers of memorabilia. This created a 'gold-rush' mentality as everyone started
hoping that some of the old items in their basements or attics would be worth huge sums of
money. The $1 million find: a first edition comic book, a one of a kind early work of a later famous
artist, or some other rare, special or in-demand item from the past.
Once people rummaged through all their current family possessions looking for hidden treasure,
they were still unsatisfied--because most of it really was worthless junk. So to continue the
gold-rush of trying to get rich off items that collectors desired, people then started buying up
things they hoped would magically become valuable. This has led to a society of people who spend
tremendous amounts of money buying items old and new, hoping some of it will become like a
lottery ticket, magically paying off in the future.
You should NEVER buy something just because anyone tells you it is collectible. Instead,
buy what really appeals to you without regard to whether anyone else is collecting them. The
term "collectible" has become a cheap label that sellers will slap onto anything--knowing that
it causes people to mindlessly associate greater value--usually without even questioning the
validity of the claim.
However, keep in mind that "rare" and "hard to find" (if truthfully applied to an item) are
positive attributes that make things interesting additions to your collection. But anything being
automatically or inherently "collectible" itself is a completely meaningless concept. You should
be listening only to your own counsel on what is meaningful or interesting to you to own.
The truth is that anything is collectible if someone wants to collect it. Some of the most
valuable collections were items that people had no idea would be valuable in the future.
And if your objective really is to try to make money, you would likely be much more successful
putting your money in traditional financial investments rather than betting on 'rare finds.'
For more detail on what aspects make some watches more valuable or sellable, see the
section below titled So what makes a watch have good resale value?
What is and is not important when choosing which NEW watch to buy
Often, you will find yourself choosing between two or more intriguing NEW watch purchase options. So
how do you determine what factors you should most and least consider?
BRAND REPUTATION is IMPORTANT-- Learn about the reputation of the watch manufacturer.
Don't ask watch-store sales people, they often are staggeringly ignorant on watches and often speak a lot of
authoritative sounding nonsense, half-facts and downright wrong information. Instead, ask people who already own the
types and brands of watches you are considering. Post questions on Internet forums dedicated to watches. And certainly,
read all you can here on the Chronocentric site.
RESALE VALUE is IMPORTANT, but ONLY IF YOU UNDERSTAND IT CORRECTLY-- Many
buyers have lost lots of their money on poor watch purchase decisions made based on poorly understood
measures of "high resale" value. People usually incorrectly focus on how much of their investment they will get back
if they resell a watch. But you should instead be focusing on how much you gain or lose in the transaction. Read the next
section down titled Watches with a good resale value are a good investment, right? for a more
comprehensive look at this issue.
TYPE OF DEALER you shop at is IMPORTANT-- Look at what types of stores are the authorized dealers
for the brands you are considering. If you are spending a lot of money on a watch, do not just shop at general department stores
or stores that sell mainly low to mid price jewelry. Look at what choices are only available at the much better jewelry stores
to get a fuller understanding of the whole spectrum of watches available. The "best" brand at a department store is not necessarily
your best choice or best value for your money. Also, make sure you understand whether the dealer you are considering buying a
watch from is an authorized dealer for that specific brand. If they are not, then you need to understand the issues involved
in buying from unauthorized dealers as described below in the section titled What are 'gray market' watches?.
UNDERSTANDING YOUR WANTS AND NEEDS is IMPORTANT-- You will make the best choice in your
purchase if you understand what you want and what is really important to you in owning a fine watch. Many people get caught
up in excessive details that end up impairing, rather than increasing, their enjoyment. Consider what you want: a watch to
impress other people, one to impress you, something stylish, something that makes a statement, one that only you know it is
special, with unusual functions, of specific metals, for dress/casual/recreational/active/sports wear, so accurate that you
never need to think of resetting it between time changes, or any of dozens of other attributes. Once you have a good handle on
these aspects, it will be much easier to select a watch.
KNOWING WHAT YOU BUY is MORE IMPORTANT than BUYING WHAT YOU KNOW-- Often, the best brands
of luxury products in terms of quality and value are ones the 'average Joe' may seldom if ever hear of. Rolex and Tag Heuer
are the two premium watch brands that are best known to the general public. But simply being popular is not a guarantee that those
brands are your best choice or the only high quality, high value products the market has to offer. It is far more beneficial
for you to research all your options instead of blindly selecting among the few brands that are 'household names.' You may still
end up choosing one of their watches--but do so out of knowledge of your choices, not ignorance of them.
BRAND HISTORY is of SOME IMPORTANCE-- While many brands trace their heritage back 100 years or
more, you need to consider how informative this is based on whether the watch you are about to purchase is better because of the
experience this history implies, or is merely riding on the coat-tails of ancient successes or bought out fine names of long ago.
A number of modern brands bearing fine names are mere shells of what their companies meant decades ago. Look at their new models
and compare them to the older models for sale on used watch dealer sites and Internet auctions. Are 5 year old models of this brand
worth anything? Are the much older models worth more than more recent ones? These can be signs of dramatic changes in the quality of
watches from a manufacturer.
WATCH MOVEMENT DETAILS are usually of LITTLE IMPORTANCE-- Unless you are an expert,
connoisseur or collector, do not worry to much about the details of the movement inside a watch beyond whether it is a) quartz,
b) certified mechanical (Chronometer), or c) non-certified mechanical. Frankly, most watches from any premium brand are sufficiently
fine devices for keeping time that will give you several decades of use if properly maintained.
Technical details of the mechanical "movement" (the actual mechanism inside the watch) are seldom particularly important unless the
watch you are buying is over $10,000 or has some unique functions. Over 98% of mechanical watches made mainly tell the time, date, and
maybe include chronograph functions. All mechanical watches with just these basic features use technology invented over 75 years ago,
and nobody has really improved it since then. So do not waste time fooling yourself into believing one standard mechanical watch
mechanism is perceptibly different from another--especially to the extent of paying more for one watch over another based on that
ROMANTIC NOTIONS OF WATCHMAKING are MOSTLY UNIMPORTANT and OFTEN FALSE OR MISLEADING--
Many fine watchmakers try to give the feel that their expensive products are finely hand crafted. They do this by creating an
image of your watch being made by generation old families of dedicated watch craftsmen, in a quaint village in the
Swiss Alps, with movements made by the same people who make the rest of the watch, each crafted over long periods of time. But
all of that is nothing more than romantic baloney designed to make you feel better about spending so much money on a watch. The truth is
that very few watches under US $20,000 are hand crafted. Most are mass produced by machines in large quantities. Even the highly
reputed Rolex is mass produced--they make over a million watches a year! Notions of the movement of the watch being better if made
'in-house' than if made by a separate company (even if owned by the same parent organization) are antiquated concepts
that have little to no meaning in the modern age of large corporations and mass production. In fact, it is the modern techniques
of mass production that ensure the higher level of consistency and quality that we enjoy of modern watches.
PRICE is NOT IMPORTANT -- "What?" you say? Price not important? That's right--it is not!!
Price is only one measure of the value and deal you are getting. What good is a low price alone when the dealer is unable
or unwilling to resolve a problem and you have no recourse with the manufacturer because you bought through an unauthorized
cut-price dealer? What good is saving an extra few percent on a very expensive purchase if the product never arrives, turns out
to be a counterfeit look-alike product, lacks good
warranty coverage, or otherwise will disappoint you or cost you more money in the long run? So always choose your watch over the
value you will receive for your money, not simply the lowest price for something that looks like what you wanted.
NUMBER OF JEWELS INSIDE THE WATCH is NOT IMPORTANT -- The number of jewels in the watch movement
are normally prominently mentioned as if they really meant something. But in fact they are a just a red herring.
These are not jewels of value. They are small synthetic ruby elements used as extremely low friction pivots
for a few critical parts of a watch mechanism. They are worth only a few pennies and do not add value to a
watch. The exact number that is appropriate for any watch movement depends on the exact design and functions of
the movement. It is perfectly normal for two watch movements with identical performance and functions to use a different
number of jewels. A standard mechanical movement usually requires a minimum of 17 jewels--but beyond that, more is not
better in any way that you could interpret.
What are the real advantages and disadvantages of buying from authorized dealers?
While authorized dealers are normally the safest choice for buying an expensive watch, there are many
other options. Making the most informed decision is always the best choice.
Authorized dealers normally offer these advantages over unauthorized (gray market) dealers:
- If you buy from an authorized dealer, then have a problem that they can not or will not solve, you can
get the manufacturer to intervene on your behalf. But manufacturers have no control over or influence
with unauthorized dealers, so won't be able to bail you out of a problem with them.
- *Some* authorized dealers are adding their own 1 or 2 year warranty extensions over the
manufacturer's factory warranty.
- The factory warranty you get through an authorized dealer can be honored by any other
authorized dealer and the manufacturer's service center. But the warranty from an unauthorized dealer
will only be honored by that specific dealer. If your unauthorized dealer goes out of business, your
warranty coverage goes up in smoke.
- An authorized dealer can special order accessories and unusual versions (like on optional
bracelets/straps or special purpose calibrated chronograph bezels) that non-authorized dealers
- Many people do not realize that you can mail order from an authorized dealer. If you know
what you want, you do not have to physically visit an authorized dealer's store to make a purchase.
Most can accept a credit card purchase by telephone or fax and ship the watch to you. If you give
them the measurement of the diameter of your wrist, they can even pre-size the watch bracelet for you.
But authorized dealers are far from consistent or perfect. In addition to usually offering only modest
discounts off of the manufacturer's retail price, authorized dealers sometimes come with these disadvantages:
- Highly variable in knowledge, courtesy and willingness to negotiate. Sometimes staffed by sales people with only
basic sales experience from working in non-jewelry stores. Some will not take you seriously as a customer if you do not
look like an extravagant or wealthy person.
- You may have multiple dealers in your area, requiring you to shop multiple locations and different stores to
find the item you want or negotiate your best deal.
- You may have no dealers in your area. Authorized dealers are concentrated mostly in and near highly populated
cities, so are convenient shopping venues for only a moderately small portion of the watch buying public.
- It can be difficult to find out what all the authorized dealers are in your area. Not all manufacturers are able
to provide complete or current lists when you contact them for dealer information.
- Typically, you must travel to them during the days and hours they are open.
- Dealers often have very limited subsets of the watches available from any one manufacturer. They will usually
offer to order other models for you. But at that point you are no better off than ordering it direct by telephone
- May have watches that have been excessively handled by browsing customers, faded or otherwise impaired from being
left in a sunny display window, are no longer with their correct box and other packaging, or have had parts like
straps, clasps or premium display boxes swapped out with other watches of the same brand to make one customer happy
at another's expense.
- Dealers seldom bother to carry original accessories for the brands they sell. If pressed, they might offer to
special order them for you. But it is often less trouble ordering them yourself from the manufacturer's service center.
- Often unaware of new models and options due to insufficiently updated manufacturer's catalogs and lack of access
or desire to read the manufacturer's website.
- Often use ploys of creating fear, uncertainty and doubt to scare you away from other dealers--rather than offering
a true value advantage to earn your business.
What does a COSC certification or Chronometer rating on a watch really mean to me?
While highly touted, a COSC certification or Chronometer rating on a mechanical (manual wind or
automatic) watch really doesn't mean all that much anymore. Most any modern mechanical watch from a luxury
watch brand is capable of operating at the performance level tested to receive these certifications. The
rare case of a certified quartz movement is a different issue, which is addressed in article
Aren't some quartz watches certified as Chronometers, too? in
the section on Accuracy.
People frequently mistake a chronometer rating as an absolute guarantee of performance to a particular
specification--usually the often quoted -4 to +6 seconds per day which is actually only one of the seven
performance measurements used in the test. In fact, the certification testing is nothing more than an
additional quality control test that the movement in the watch passed at some time in the past, long before
it was even assembled into your watch. It is not a guarantee that the watch will never deviate outside a
particular range. In fact, mechanical watches are normal to deviate--that's why the chronometer rating
exists in the first place. The range of these tests were established decades ago, when the average
mechanical watch was nowhere near as accurate as they are today.
Imagine getting an A+ in math in high school and then being expected to never ever make a mathematical
mistake the rest of your life. That's not how performance tests work. They only certify that you have
proven once to have achieved a specific measure of performance under reasonable conditions. They neither
mandate that you can never vary below that level in the future, nor do they prove that someone else who
did not take that same test can never meet or exceed your level of performance. But having once established
that you can achieve that level, the certification gives greater public confidence that you can perform
similarly well in the future.
Same with your mechanical watch. It may have passed a test in the past, showing it was capable of
getting an A+ in performance. But the actual day-to day performance of any mechanical watch--certified
or not--can change a lot based on how well the watch is wound, what position it is left in overnight
on your dresser, whether it takes a significant bump during the day and other factors. So do not give
tremendous amount of weight to the significance of these certifications. In particular, do not assume
that a specific watch is inferior because it lacks a certification--it did not take the test and fail,
it simply never took this optional extra test.
The reason that some watches are still submitted for these certifications is more as a marketing and
sales tool among competing brands. The presense of a certification can give you a small measure of
additional confidence in the selection of your watch, but nothing more than that. Most any mechanical watch
from a premium brand, when adjusted properly, will perform to within the certification ratings.
For additional information, see the section on Accuracy of Fine Wristwatches.
I am worried after reading on the Internet about some people having a problem with the watch I'm thinking about buying.
Virtually none of any of the 'problems' you might hear about are more than isolated cases. Expensive
watches are not different from any other elaborate mechanical item, whether it is Rolex, Omega, BMW,
Mercedes, or other such items that are simultaneously high-end and large production volume products.
Despite superior quality control procedures, all are subject to minor manufacturing inconsistencies and
technical glitches. It is virtually impossible to find any luxury brand of technical product that
at least a few people have not had a problem with.
In addition, many first-time owners of luxury and mechanical watches have misunderstandings and
unreasonable expectations of the operation, accuracy, durability and limits of these fine timepieces.
So often, complaints or criticisms come from concerns not actually related to any real defect
or problem with the watch itself.
To give some perspective to the issue, consider the largest of the luxury watch manufacturers, Rolex,
who manufactures over 1,000,000 watches a year. Even if they have an astronomically high 99.995% perfection
rate (they do not publish their actual rate, so this number is purely an example of an extremely high perfection
rate), that means that over the past ten years, 50,000 watches may have been sold with imperfections that
might need to be addressed.
Most of the people you see posting on Internet watch forums have bought at least one and frequently three
to five new expensive watches in the past 10 years. When these people mention any bugs they experienced,
you are seeing a sampling of problems across a huge number of watches and a large number of years.
Certainly any brand will have some reported problems. But given the relatively small number of problems
mentioned of Omega, Rolex and most other premium watches in the online forums, that sampling rate proves
that these watch manufacturers have an excellent success rate. The unfortunate but inevitable imperfections
appear to be at an extreme minimum and are normally addressed within the warranty period.
Occasionally an unhappy customer of a product will post an anti-company propaganda web site to harass the
company--often out of vengeance or a 'pay me off to shut me up' motive. Despite a lot of emotional wording,
these crusades attempting to scare customers away from the company's products are seldom based on anything
more than an isolated case of customer confusion or mishandled customer service. Some continue to post
disparaging information long after the issue was amicably resolved with the dealer or manufacturer.
So do not let any isolated complaints or problem reports scare you off any of these fine brands. For
every isolated problem report for a top brand luxury watch, there are thousands of satisfied owners who
never experience any difficulties.
Watches with a good resale value are a good investment, right?
Watches can be a good investment--but not for everybody. One really important thing to remember,
watches, like automobiles, normally lose value over time and are not good investments unless you
really know a lot about the market and specific items you are investing in. Anytime you buy a watch or car
new, the value immediately drops. For fine wristwatches, many can be resold for only 40% to 80% of what
you will pay for them from a new watch dealer.
For the average watch enthusiast, buying and selling of watches is usually at a loss. Maybe a break even
at best. Most consider this simply the cost of owning the watch for the months or years they enjoy it.
Do not be confused or misled by statements that certain watches have a 'higher resale value' than others.
Since almost all watches (except the truly rare and special collectibles) lose value over time, you have to
judge the resale value of a watch by what you lose, not what you get back.
For example, say you have a choice between a $3500 watch that has an 80% resale value versus a
$1750 watch with only a 60% resale value. The more expensive watch sounds like the better investment.
But when you look at how much you will lose, the result may be surprising.
$3500 new, resell for $2800 (80%), net loss $700
$1750 new, resell for $1050 (60%), net loss $700
While these numbers are only examples, they show that you need to specifically evaluate your choices
rather than simply relying on generalizations about 'better resale.' For investing and resale, used watches are
often a better financial deal because they are already depreciated to the resale value--so you are much more
likely to be able to resell them at close to what you paid for them.
Watches not a good investment? But many classic watches sell for far more now than when new!
Sure, there are many stories of watches that are worth much more than was paid for them years ago.
But as described above, do not let general statements and shallow analyses mislead you on what truly
is or is not a good investment. Again, watches are seldom a good financial investment--and then only for
the people who are truly lucky, truly knowledgable or are dealing with one of a few very high-demand
For example, someone asked about a Omega Speedmaster Professional bought in 1969 for $300 which today
sells in good condition for a minimum of $1000. Sounds like the watch has more than tripled in value by looking
at just the raw numbers. But has it really? Let's look at the same scenario converted to "real dollars."
Based on the Consumer Price Index in the USA, $300 in 1969 translates to about 4.7 times as many dollars
in 2000. So spending $300 on a watch back then is equal to buying a $1400 watch today. If that watch is now
worth at least $1000, then it has retained over 70% of its real value. In "real" terms, that watch has only
cost 400 modern dollars (plus maintenance) for 31 years of enjoyment. Quite respectable, but certainly not the
astounding "tripled in value" story that it initially appeared.
In another example, a basic Rolex DateJust bought in 1981 for $900 would equal $1700 spent in 2000. This
watch is now worth at least $1400, so has also retained over 80% of its "real" value. That translates to a cost of
300 modern dollars (plus maintenance) for 20 years of enjoyment of this watch.
So while almost all watches are depreciating investments--meaning they will lose, not gain, value over time--many
if cared for well maintain enough value that their cost of ownership is not only very affordable, but potentially
less than many lower priced watches.
So what makes a watch have good resale value?
Firstly, there is no magic formula for making money off of watches with high resale values. As described
above, watches are generally quite poor as financial investments. The best you should expect is to buy a watch
that you will enjoy. If you think yourself likely to ever resell your watch--something only a small percentage
of luxury watch owners ever actually do--then the tips below should help you choose
with a clearer understanding of what does and does not contribute to resale value.
The primary factors in why resale values vary among brands, models and individual pieces are:
- The objectives of used watch buyers are somewhat different than for new watch buyers.
Used watch buyers seek greater value in their purchase in return for foregoing some of the
benefits of purchasing their watch new. Therefore, the appeal and attraction of various watches
may be noticeably different on the new versus used market.
- New watches are priced with 'exclusivity' premiums for certain luxury features such as
precious metals, diamonds, mechanical movements or special editions. The resale market still
values such premium features, just not at the heavily inflated values of the new market prices.
- Condition plays a major part of used watch values. All new watches are assumed to be in new
condition and warranted. But used watches bear additional variability and risk. Specific brands, models
and movement calibres may have reputations for better or worse than average reliability.
- General interest and demand for specific brands and styles fluctuate. Sometimes a positive
review of a particular model will notably increase demand for them on the used market.
To understand what makes a watch have a good or bad resale value, you really need to look at it from
the perspective of what makes a buyer more or less willing to pay for a particular used watch?
Aspects that have a very positive influence on resale value:
- RARE or HARD TO FIND-- Following the basic economic principle of supply and
demand, anything people want but is hard to get, they will be willing to pay more for.
- LIMITED EDITIONS-- Watchmakers occasionally release "limited editions,"
often tied to celebrating some company anniversary, historic event, or to boost enthusiasm for a model line.
These editions are often uniquely numbered. If adequately limited to a small number, these have a very
decent resale value later.
- ACTIVE WARRANTY-- Definitely a plus if the factory or dealer warranty
is still valid and transferrable to the buyer.
- TRACEABLE TO A FAMOUS PREVIOUS OWNER-- One unique category of valued
watches are those worn by some person of note. In particular, specific watches documented to have been worn
by movie stars or historical figures--especially during the filming of a movie or at an historical event--do
command premium prices on the used and collector markets.
Aspects that may have only a small influence the resale price:
- NOT SO LIMITED "LIMITED EDITIONS"-- Releases of limited editions of a
model are not very limited when quantities reach 5,000 to 10,000 or more. These numbers may sound fairly small,
but are not that far from how many of a specific model variation the company would sell in a year or more anyway.
When a company releases too many of a supposedly 'limited' release, the resale values drop to close to what
a regular edition of the watch would sell for.
- MECHANICAL VERSUS QUARTZ VERSIONS OF THE SAME WATCH-- Some
watchmakers release identical or similar models in quartz and mechanical movement versions. The finer
brands usually add a moderate 'exclusivity' premium to the prices of their mechanical watches. At resale, the
mechanical versions still command a premium over quartz counterparts. But the differential is often reduced
enough to make the quartz versions have a slightly better resale value compared to their original price.
- ORIGINAL BOX AND PAPERS-- While many people like receiving the original
boxes with their purchase, few people do anything with them but store them in a closet. So the original
packaging may improve the salability of a watch, especially if the watch is to be a gift. But the boxes
and papers do not add much to the selling price unless the watch is close to new.
- INTERESTING SERIAL NUMBERS-- On rare occasions, a watch will surface
with an interesting serial number. Examples include: even numbers; numbers with interesting patterns;
numbers that relate to beginning, end or year changeover in production; or hidden meanings like an Omega
Speedmaster Moonwatch with the date of the moon landing appearing in the serial number or a James Bond
Rolex Submariner or Omega Seamaster Pro with serial number ending in 007. While these add a novelty
interest to the watch, the influence on resale value is usually trivial.
Aspects that lose the most value on resale:
- GOLD, PLATINUM or other PREMIUM METALS-- While precious metal watches do sell
well on the used market, they do not command the same premium that they did when new. Such watches carry very
inflated 'exclusivity' prices when new--often 10 to 20 times the value of the metals used. Upon resale, the
values better reflect the market value--not the exclusivity premium.
- DIAMONDS-- Diamonds on dials, bezels and other parts of a watch are an
expensive addition on new watches. But like with precious metal on watches, these bear a significant
'exclusivity' premium in the new watch pricing that is several times the value of the diamonds themselves.
- BOTTOM OF THE LINE MODELS-- A few premium brands have a clearly bottom of
the line model that lacks the features and status of their main product lines. Rolex in particular does this
with their "Air-King" series and other models where the least expensive version lacks the date or COSC
certification. Buyers of new watches are sometimes attracted to these models as the least expensive way to
get close to the watch they want for less money. But these step-down versions almost always lack the better
values and desirability on the resale market, so are often a poor choice when resale is of concern.
And finally, aspects that notably hurt resale values:
- WATCHES WHERE SERIAL NUMBERS HAVE BEEN REMOVED-- An unacceptable but
somewhat frequent practice of gray-market dealers is to remove serial numbers from discounted watches.
For some brands, the manufacturer may refuse to service the watch at any authorized service center or
supply certain replacement parts to independent watch repairers for that watch. That risk reduces resale
the value, especially for brands that have publicly declared they will not service such watches.
- CUSTOMIZED WATCHES-- Watches, like automobiles, sometimes get customized
by their owners. Often this is done by inscribing names, dates or memento information on the back, or by
using aftermarket parts or parts from different models to make a unique piece. While these modifications
cost the owner more money, they usually devalue the watch and reduce the chances of finding someone else
that would want one customized in that manner.
- BRANDS WITH POOR DURABILITY-- Not all expensive brands are made equal. Some
mid range brands sacrifice long term durability in their products.
- BRANDS WITH HEAVY RETAIL DISCOUNTS-- Resale prices are usually based on
the retail selling price, even when some discounts are customarily available. But brands sold officially
through cut rate stores or places where they are often marked down heavily usually have poorer resale as
they are readily available cheaply. Note that this does not effect premium brands that sometimes found--quite
unofficially--through warehouse stores like Costco and Sam's Club and other clearly non-authorized dealers.
Why is the warranty sometimes longer depending on where you buy the watch?
Watch manufacturers typically offer limited--often only 1-year-- factory warranties on their products. But in
this modern world, that is a pretty nominal warranty period for such an expensive purchase. To give customers a greater feeling of confidence (and combat the tactics of unauthorized dealers), many authorized dealers offer to extend the
warranty out an additional one or two years.
What is important for you to know is that--in most cases--this additional warranty coverage is not
through the manufacturer or their official and international service networks. The watch manufacturer's
warranty obligation to you ends under the terms of the original factory warranty, which usually covers just the first
year. After that time, the manufacturer's service center any other authorized dealers will not be able to provide
free service under the "extended" portion of the warranty. Those additional year(s) of coverage are between you
and the specific dealer who sold you the watch. So should you need service during the "extended" period, you
must take the watch back to that specific dealer.
Unauthorized (gray market) dealers, who cannot include even the initial factory warranty with watches they
sell, have been trying to gain a competitive advantage by offering their own warranties of longer durations. But again,
any such warranty is through that specific dealer and will not be recognized or honored by the manufacturer or any
other watch dealer.
What does it mean when someone sells a watch with an 'open warranty' or 'open papers?'
The phrases "open warranty" and "open papers" create an impression in the novice watch buyer's mind that
the warranty is transferrable and opened ended--so it can be activated whenever they want to start the
(usually one year) warranty period. But beware, this is often far from the truth!
What it actually means is the warranty paperwork was inadequately completed. Incomplete paperwork
can cause your warranty to be effectively null and void. In some cases, the warranty is validated by a
dealer stamp, but the date is left blank. In other cases, it may mean the warranty card is totally blank.
In either case, the warranty is likely useless.
A warranty card is not a pass to free service all by itself. A dealer or manufacturer's service center may
well request further documentation beyond just the card to establish the date of purchase or authorized
dealer status of the point of initial sale. This is not unusual as many warranty cards are lost, unreadable
or incomplete--even coming from many of the authorized dealers.
So no matter what the warranty card says, it is not by itself a guarantee of service. If it cannot be
backed up with the owner providing a sales receipt from an authorized dealer that matches the date of sale,
then the warranty card will likely NOT be honored. People have tried playing games with warranty cards for
decades and the manufacturers' service centers know what to look for to spot bogus warranty claims.
What are 'gray market' watches?
Gray market watches are genuine watches from the original manufacturer. They are not fakes or factory
seconds. The only thing that makes them different is that they passed through an unauthorized dealer or
reseller on the way to you. Where this becomes an issue is that the manufacturer's warranties are
not valid on these watches.
For more information, see the main section on Gray Market Watches.
What about fake, replica, look-similar, and counterfeit watches?
Most popular makes of fine watches are prone to having their designs copied by manufacturers of
replica watches. These watches sell from as little as $10 to several hundred dollars--but $100-150
appears to be the most common range. They vary from generic look-alike to exacting reproductions of
the exteriors of the genuine watch. Often, even details such as the manufacturers logo, serial numbers,
and other markings are reproduced.
For more information, see the main section on Fake And Counterfeit Watches.
Also, some of the department store brands of watches including Peugeot, ESQ, Fossil, Citizen, Wilson, Timex,
and even Seiko will make watches that look suspiciously similar (but not quite close enough to get them
in trouble) to the popular models of the high end brands like Omega, Rolex, and Breitling.
What should I know about buying NEW watches from Internet dealers?
Omega and many other fine watch makers' official positions are that you should not purchase new watches
from dealers who sell over the Internet. They say you should visit an authorized reseller of their products to make
your purchase. Almost none of the fine watch manufacturers have allowed authorized dealers to sell over the Internet,
but I am happy to report that there are an increasing number of exceptions.
Ironically, many of these manufacturers who object to the mass of unauthorized dealers on the Internet
offer only very limited information on their watches on their official web sites. So they essentially force people who have
no easy access to an authorized dealer--or have an unknowledgable authorized dealer--to seek out the unauthorized
Internet vendors to get adequate information on the majority those products.
Buying through an authorized dealer is the safest way to acquire any fine watch. You should have no
problems obtaining warranty service directly from the manufacturer or any of their authorized retailers or repair
centers. You should have no risk of receiving a fake, gray market, or serial-number-less watch. While many
will initially quote you retail price, in many areas, you should be able to negotiate 10-20% off that price. Increasingly,
even authorized dealers are including an extra year or two on top of the manufacturer's warranty.
You do have alternatives, but each entails some risk in return for saving more money on your watch
purchase. A number of the risks are described in the sections above on Gray Market and Fake/Replica watches.
Since most fine watch makers do not permit authorized dealers to sell over the Internet, then it is likely that
any watch purchased over the Internet would be a gray market item at best. Many people have had excellent
experiences buying from reputable gray market dealers who are honest and stand behind their products. There
are also reports of people who have had very unsatisfying experiences buying from authorized dealers. As with
any expensive purchase, ask a lot of questions and learn as much as you can about the product and the seller
before making any purchase.
Also, do not confuse authorized dealers that communicate over the Internet with unauthorized dealers
that sell directly on the Internet. Most fine watchmakers use the Internet to
display their products and communicate to their customers. An increasing number of reputable, authorized dealers
can be reached through the Internet for information and will accept telephone or fax orders and ship the product to you.
What should I know about buying watches on Internet auctions and 'for sale' boards?
The increasing popularity of online auctions and for sale forums opens a larger number of watch
buying opportunities along with a chance to deal with hundreds of different and potentially completely
unknown sellers. Beyond the common risks of dealing with dishonorable sellers, the biggest thing you need
to protect yourself from are sellers that prey on people in individual or private sales over the Internet. Use
appropriate cautions buying watches off of online auction houses, such as eBay.
Here is the list of warning signs to watch out for:
- Does the seller claim to know little to nothing about the watch?
Occasionally you will see a genuine-looking watch that the seller appears to know little to nothing about.
This may lead an enthusiastic buyer to think they are getting a killer deal on a genuine watch from an
uninformed seller. But the seller may be being intentionally evasive on details so you cannot go back
against them for any misrepresentations when you discover that the watch was not what you thought.
- Does the seller use a vague or untraceable explanation of where they obtained the watch?
Explanations such as receiving the watch as a gift, winning it in a poker game, finding it at an estate sale,
buying it while drunk, or similar shaggy-dog stories obscure the watch's true origin and make it difficult
to hold the seller accountable for the authenticity of the watch. I even saw one auction where the seller claimed
to have won the watch in a bet--yet his photo showed two versions of the same watch side by side.
- Does the seller say they cannot guarantee the authenticity of the watch?
Think about it.
Can you seriously believe that the seller is so foolish as to take several hundreds of dollars less for an expensive
watch--instead of paying a jeweler a few dollars to verify it first? Never buy a watch that the seller does not
guarantee the authenticity or you cannot have verified by an independent party before giving the seller any money.
- Does the seller show a photo of what should be the actual watch for sale? Or did they use a
professional photo swiped from a catalog or manufacturer's website?
Never buy a watch without seeing a photo of the actual one you are getting! If you do, you may be quite
unpleasantly surprised at the condition or authenticity of what you receive.
- Are there any oddities or inconsistencies in the seller's description of the watch?
If the watch is a recent model, compare the seller's photos and descriptions to the known fake watches on display in the
zOwie Rogues Gallery of Fakes. Do they mention a see through
back on a watch that should not have one? Check every attribute that they mention against what you know and
can find out that the real one should have.
- Is the seller truly a private individual selling just one or two watches from their collection as they imply?
Look for prior sales of similar watches from the same individual. Some people make a business of selling fake or
otherwise questionable watches every couple of weeks.
- Are the other bidders on a watch actually real people and legitimate buyers?
A further devious tactic is for a questionable seller to have multiple identities on the Internet or friends acting as
'shills.' These additional fake buyers will submit bids to make it look like people are fighting to get an item. This
frequently prompts real bidders to join in on the frenzy--assuming that the popularity means the item is genuine
and worth more than is being asked. Baloney! Look for other bidders that may have recently changed the name
on their accounts or that have very low feedback counts.
For sale forums on watch collector oriented sites may be safer. Since they are public forums frequented
by watch experts, you are more likely to see knowledgable people jump in to comment on suspicious-looking
watch descriptions, photos, or other claims by sellers. You'll also have easy access to experts that enjoy
answering questions on their favorite subject--watches!