For A Few Euros More

Word reached the North Shore offices of Henki Time this morning that as many as 65 former Chrono24 loyalists are now footloose and fancy free. Or put more bluntly, approximately 13% of the staff got the fuzzy end of the lollypop. Chances are not this guy though...

Courtesy of Chrono24

But I would rather light a candle than curse their darkness. 

How did this happen? Chrono24 is considered the biggest and the best site of its kind and it certainly had ample funding and a fairly large number of staff members. It even had a media wing of sorts to help convey the message. Ultimately, they might have overestimated the true strength of the "Pre-Owned" watch market. And this is perhaps down to several contributing factors.

So as a public service announcement, your old pal Henki thought he'd shed some light on the reality that is the big-time pre-owned watch bonanza you've all been hearing about. Now many of you boys and girls are operating under the (fair and reasonable) assumption that pre-owned means used (be it gentle or rough). Well... maybe not so much, actually, at least if you go by volume.

Former readers of "The Blog Formerly Known as Tempus Fugit" will recall my ongoing query as to the veracity of the strength of the pre-owned market. For those of you new to this brave new world of up-cycled horological retail, allow me to inform you that virtually all of the watches found on various pre-owned sales sites are (by definition) pre-owned. Yes, some other person (sometimes in the person of the watch brand itself) did, in fact, own the watch before the intrepid and clever watch bargain hunter bought it for pennies on the dollar ! What seems to be a phenomenal stroke of good fortune and shrewd purchasing is often just Kabuki Theatre for the semi-gullible. So allow me to show you the man behind the curtain that you have been told to "pay no attention to"...

When it comes to recent vintages in large numbers, more often than not, there is only one (and sometimes even less than one) degree of separation from the the watch brand itself and the platform selling its "fresher" wares to you, the watch buying public. In other words, while it sounds sexy to share with "Talking Watches" about how you bought a 2-year old model "pre-owned", more often than not you have likely bought a brand, distributor, or retail partner's unwanted inventory. In the "new/unworn in-box with papers" world of buying and selling you are providing a very valuable service. Because you have made it possible for everyone to get paid - and even kicked a little into the pockets of the "pre-owned" website owner who connected all of the dots.

Watch brands have, for decades now, greatly overproduced what the visible market can consume and digest. The result has been mountains of timekeepers that needed to be "washed" out of the factories and storage facilities and off of the company books. Now back at the turn of the century you could transship, utilize parallel markets, or use e-commerce websites that specialized in selling very large volumes of over-stocked products to clear your vaults. Some of us still remember those halcyon days when you could buy the late 90's Omega Dynamic, or the Cartier Tank Basculante for truly stupid prices. I still regret not clicking that "buy now" button. Well, it's all just Tank Basulantes under the bridge now...

But the net impact is even more profound - imagine that you as an individual are hoping to sell your gently used (insert name of large watch company here) and have given it what you feel is a realistic and fair price. But then, (insert name of large watch company here) decides to jettison a large amount of inventory which just happens to include several examples of your gently used model. And they have priced it 10% less than yours, and list it as "new, in box, with papers".  Which do you think will sell first? More than likely if you are anxious to make the sale to fund a new purchase, you will lower your price, which then has the knock-on effect of further devaluing (insert name of large watch company here's) watch, be it new or pre-owned.

And at the higher end, with Rolex going into the "Certified" pre-owned business, it is likely just a matter of time before others jump on that particular bandwagon. And then the question becomes:

Would you feel more comfortable with a Nautilus that Mr. Stern's crew is vouching for, or one that an algorithm acts as the trusted, knowledgable resource?

Courtesy of GQ

"This is a Rouchefoucauld. The thinnest water-resistant watch in the world. Singularly unique, sculptured in design, hand-crafted in Switzerland, and water resistant to three atmospheres. This is "the" sports watch of the '80s. Six thousand, nine hundred and fifty five dollars retail!  It tells time simultaneously in Monte Carlo, Beverly Hills, London, Paris, Rome, and Gstaad!"

As conveyed by Louis Winthorpe (as played by Dan Akroyd in Trading Places) to a clearly unimpressed pawn broker (as played by Bo Diddley), it is hard not to be distracted from your common sense by shiny things. As that other great commentator on the watch business, Gordon Gekko (as played by Michael Douglas) once opined -

"A fool and his money are lucky enough to get together in the first place."

On the one hand, I don't think it is reasonable or realistic to expect a website that acts as (to a large extent) a third-party intermediary to have the time and / or resources to authenticate every single watch (out of several thousands). But ultimately, these third-party intermediaries are on the hook if something goes sideways. 

Now what has really gone wrong with Chrono24 is not something that is really knowable for most of us. We have theories, but in truth the old adage still holds true -

Those who know won't say, and those who will say don't know.

For me, it is safe to say that I am not a participant in this game of horological musical chairs. And if I did have the itch for something pre-owned, I would likely spend my money with a smaller organization like Wind Vintage. But then again, that's just me, your mileage may vary.