Is buying a luxury watch from the grey market a good idea? Are these marketplaces illegal or not?
Let’s answer those questions and more by reading our detailed guide about these grey market watches and how this process works.
The grey market dealers have been the go-to place for many watch enthusiasts who want to purchase a new watch for a discounted price and avoid the almost unending waiting lists that authorized dealers often have.
In fact, almost 25% of luxury watches in the watch world are sold through these marketplaces.
But just like any other market, there are pros and cons when it comes to purchasing from there.
And if you want to know our honest thoughts about the grey market, continue reading this article specially tailored for watch enthusiasts!
Grey Market – What Does It Mean?
The grey market (or gray market for others) is a marketplace where watches are sold by non-official resellers of luxury watchmakers.
This means that grey market dealers are not authorized nor official partners permitted to sell watches by luxury watch companies.
Despite not being an official distribution channel of a watch brand, selling these watches is legal and in accordance with the law.
In fact, a grey market dealer often buys overstock watches from authorized dealers who want to clear their excess inventory, making their products authentic and going through the “proper” process.
Sometimes, other dealers also buy pre-owned watches from collectors who want to sell their timepieces just to make a profit.
In recent years, many grey market dealers have gained a respectable reputation in the luxury watch industry for their exceptional service to their clients. Online platforms such as Jomashop.com are one example of this trend.
How Does The Watch Grey Market Work?
Famous luxury watch brands such as Rolex and Patek Philippe have partnered with authorized dealers to control where and how their watches are sold. This is done to maintain its exclusivity and reputation as a luxury watch brand.
This marketing strategy has done wonders for heavyweight brands in the watch industry for decades.
But when these authorized dealers have surplus stock that is not going out very fast or need to clear some space to make room for high-demand watches, one of their last resorts is to sell some of their timepieces to a grey market dealer to make money to get new orders.
After these watches are sold wholesale or retail, these gray market watches will be sold again through another physical store or online platform for a much lower price compared to the original retail price.
Are Watch Grey Markets Legitimate?
First of all, you must be aware that the grey market is different from the black market.
As we said earlier, the grey market is where you can spend your money and buy an authentic luxury watch legally, even if the seller is not an authorized dealer.
On the other hand, the black market refers to a place where transactions are shady (stolen or illegally acquired) or fake watches are sold.
Another misconception we often hear is that a grey market watch is in some way different in quality and design if you compare it to a timepiece from an authorized dealer.
This is not true.
Grey market watches are produced in the same factory as the models you see in authorized watch retailers’ boutiques. The only difference between them is the price and the official warranty of the manufacturers who made the timepieces.
Benefits Of Grey Market Watches
#1. Cheaper Prices
Because gray market watch dealers buy watches at a much lower cost, they most likely sell them below the true market price of the model, which is why this is where you can buy the most affordable luxury watches in the market today.
In fact, this is where you can find the cheapest Rolex models for as low as $5,000.
And if you are lucky enough, you can even find some models in limited editions, such as different variations of the Rolex Daytona, for a very reasonable price.
#2. Warranty
As dealers in this marketplace are not authorized by watch manufacturers, gray market watches are sold without the manufacturer’s warranty.
But don’t worry. Besides giving huge discounts, most prominent gray market dealers today offer their own warranty system to protect their customers from malfunctioning and defective watches and to give their clients exceptional shopping experience.
Some even offer a full refund option if you don’t like the watch you received.
#3. Large Marketplace
For genuine watch collectors and enthusiasts, the gray market is a paradise where they can find some of the rarest timepieces and vintage models that cannot be found in any other authorized dealer’s boutique.
Moreover, they offer a wide variety of brands and models that you can choose from. From the cheapest Audemars Piguet watches to the limited editions and million-dollar models of the Richard Mille brand.
Disadvantages Of Grey Market Watches
#1. Fake Watches
Although there’s only a small chance, the possibility of encountering fake or counterfeit watches when buying in the gray market is still possible.
That is why buyers should always keep an eagle eye whenever they make a purchase in this marketplace.
Remember to always do your research first before purchasing a watch. Always buy from a reputable and trustworthy gray market watch dealer to avoid these instances.
#2. No Packaging Or Paperwork
Gray market watches often don’t come with a box or paperwork. This is due to many possible reasons, such as the original owner losing them or the timepiece being vintage and having been passed down, and many others.
But although they don’t have the original box and papers, bigger and reputable gray market dealers often offer new elegant boxes and authentication forms to compensate for the lack of these accessories.
#3. Illiquid
Due to the absence of boxes and papers, reselling watches from the gray market is not easy to do.
That’s why watches purchased from authorized dealers or official distributors sell the fattest compared to watches that don’t have any official papers to prove their authenticity.
What To Look For In Grey Market Watches
The Watch Dealer
Before considering a watch purchase, always look for a reputable watch dealer you can trust or a seller that has a long history of good customer service.
A good watch dealer often offers their own warranty system and easy return policy. They also employed professional watchmakers to authenticate watches sold to them to prevent counterfeit products.
What Is Included In The Sale
If you happen to buy a watch online, always read the details of the deal and know what is included in the sale.
Reading this can give you thorough information about the timepiece, its warranty card, and other accessories that are included in the deal, such as extra straps and other watch necessities.
Watch Quality
Most grey market sellers have their own grading system that tells the quality of the watch.
They may most likely indicate particulars about the model, such as if it is a new or pre-owned piece that has some scratches and other appropriate details about the timepiece.
Moreover, trusted sellers often display the actual pictures of the model they sell for you to check the current state of the timepiece you are eyeing.
Watch Service
Another important thing to consider when purchasing a timepiece from a gray market dealer is whether the model you like has been serviced before or not.
Most likely, if you buy it from trusted dealers, they will service the watch before they sell it to clients.
But this is not always the case. For example, a Rolex watch servicing can cost you $600 to $1000. This may not be a huge amount for some, but still, these fees would pile up, eventually costing you more money, time, and effort.
Urgency
If you happen to bump into watch dealers forcing you to buy a watch while offering an “irresistible” promo, think again because this is a major red flag.
Most likely, these are scammers who are preying on clients who are allured with their “so good-to-be true” promises.
Specialized Dealers
If you are looking for a particular type of watch, look for gray market watch dealers that specialize in this type of watch model.
For example, if you are into vintage watches, find a seller known to sell authenticated watches like this. You can read the reviews on their website, ask their former clients, or even use watch forums to gather information about the dealer and the watch you are looking for.
Grey Market vs Authorized Watch Dealers
Pricing
Generally, watches in the grey market are much cheaper compared to an authorized watch dealer. Mainly, this is because they are most often pre-owned models.
But sometimes, it’s the other way around.
Prices of watches in the gray market depend mainly on the current demand for the exact model on the market. This is especially true for limited-edition models and highly collectible timepieces from Rolex, Richard Mille, and Patek Philippe.
But the good thing here is that you won’t need to wait for years before receiving the model you like.
Availability
Have you ever tried to enter a Rolex boutique to buy a watch, only to find out that they don’t have the stock for the timepiece you are looking for?
If yes, then you are not the only person who has experienced that. In fact, most buyers have experienced that too.
Remember that authorized dealers only sell to people at the top of their waiting lists, which are most likely clients with an excellent purchase history with them.
Unlike these ADs, gray market dealers prioritized customers depending on which of them had paid for the watch first. In short, buying on these platforms is more convenient and hassle-free.
Authenticity
As we said earlier, although there is only a small chance of buying counterfeit items on the gray market, there is still a possibility.
That is why we would like to repeat and seriously reiterate to do your research first, look for red flags, and only trust a reputable dealer on the gray market to protect your hard-earned savings from scammers.
Warranty
Want to fully protect and ensure your watch from any unexpected accidents? If so, it is best to buy a timepiece from an authorized dealer who can provide a manufacturer’s warranty.
But if you really want to buy a model in the gray market for its benefit, then be sure to choose a gray market dealer that offers its own warranty system.
But do take note that this warranty only applies to certain damages, and the dealer has the right to refuse if he thinks that the problem with the watch is not covered by the warranty.
Waiting List Priority
If you really want to buy a brand new Daytona or the newest Submariner from a local authorized dealer, prepare yourself for a long wait game, as Rolex watches are also synonymous with its long waitlist.
But don’t worry. There are ways to shorten the Rolex watch waiting list. In fact, we created a guide that shares some expert tips on how to get on this process, from creating a great relationship with your AD to building a good purchase history with them.
But if you want a much effortless experience in buying your first luxury watch, the gray market is the place to go.
Should You Buy Grey Market Watches?
Of course, yes!
Purchasing watches from a grey market dealer has some advantages and disadvantages. But the benefits of buying from them totally outweigh any possible drawbacks you might experience.
Just like what we mentioned before, this platform is a large marketplace where you can find a variety of limited edition and vintage watches. Moreover, they offer reasonable prices that come with the dealer’s own warranty system.
Grey Market Watches – Conclusion
And that’s it!
Those are all the things you need to know about grey market watches, including their advantages and disadvantages, as well as the factors to consider if you plan to purchase a timepiece from these platforms.
We hope that you can use this guide for your watch-collecting journey.
If you want to learn how to spot a fake Rolex watch from a real one, you can also check out our informative guide here.
And if you have questions, comments, or suggestions, please feel free to leave a message below!
