Why high-end watch brands are moving into pre-owned markets

Why high-end watch brands are moving into pre-owned markets

The global second-hand watch market is worth $6.8 billion a year. These tantalising figures have not gone unnoticed by industry chiefs.

Lower prices, side-stepping that first hit of depreciation on a brand-new watch, or obtaining timepieces that have gone out of production: These are some local watch collectors’ oft-cited reasons for embracing the pre-owned timepiece market. Sales director Paul Cheong, who has been collecting timepieces for some 15 years (and appears in the collectors’ feature elsewhere in this magazine), often scours websites for older pieces that you won’t see on retail shelves. He shares: “I don’t believe in paying a premium for watches. Also, today, you won’t be able to find many of my watches new, such as those by Gerald Genta and Daniel Roth.”

Cheong is not alone. In the Trends Report 2018 published by the Fondation de la Haute Horlogerie, financial consultancy Kepler Cheuvreux estimated the global market for second-hand watches to be worth US$5 billion a year. Size aside, this segment has posted annual growth rates of 5 per cent, outperforming the market for new watches.

BRANDS WANT IN

These tantalising figures have not gone unnoticed by industry chiefs, several of whom have recently made statements about their plans to enter the pre-owned watch game. These include Audemars Piguet, MB&F, Richard Mille and Breitling, although Richemont Group – the conglomerate behind brands like Jaeger-LeCoultre and Cartier – also made its intentions clear when it acquired Watchfinder, a UK-based pre-owned watch retailer, this June. No longer are brands content with watching from the sidelines.

For Audemars Piguet CEO Francois-Henry Bennahmias, the main reason for moving the brand into the pre-owned market is to minimise leaving money on the table. He is keen to cut out the middleman for the business, and engage with clients directly through various channels. Says Bennahmias: “I want to be there when you buy your AP watch, and help you sell it off when you want to trade it in for another one. Why would you go to an auction house when you can come to us? These auction houses will come to us (for information on the watches) anyway, and charge you for it. No, it’s about time we recapture this business, which could be 10 times bigger than the one for new watches.”

While Audemars Piguet does not have firm plans yet, it has begun experimenting with different ideas, such as trade-in programmes, and does not rule out opening boutiques selling pre-owned timepieces within the next three years. MB&F founder and CEO Maximilian Busser shares that his brand is building a pre-owned department that will curate out-of-production timepieces by buying them back, refurbishing them, and reselling them.

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02 INDIE MOVEMENT

MB&F chief Maximilian Busser has pointed out that pieces like the Music Machine 3 have done well at auction in past years.

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