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Thad's avatar

People love to bash FHB at AP, but for me, this guy takes the cake. His position on CPO is preposterous, nonsensical. It reeks of snobbery and shortsightedness, "we can't soil our good name messing around in the muck with these, these FLIPPERS!" How is ALS doing as a business anyway? I actually have no idea. Anyway, good post once again.

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Sfwatchlover's avatar

I enjoyed reading this thoughtful article, as usual! I was not so surprised that Lange didn't want to pursue a CPO program. The sale of pre-owned watches in the boutiques will hurt the sale of new watches, and they don't have the resource to take on this task anyway. We may see this clearly when comparing to Rolex.

As many of the Rolex watches are sold at higher than retail prices, available of such watches in the AD stores will not hurt the sales of new watches. People will prefer to buy new ones at lower prices of course, and will consider pre-owned ones when they don't have a chance to obtain the new watches. In Lange's case, most of the watches are sold at lower prices than retail at the secondary markets. Imagine the available of certified watches at the Lange boutiques, many people will go for these watches with lower prices.

When Rolex launched the CPO program, it asked its retail partners to opt-in. Some decided to participate and others have not done so yet. I asked my local Rolex boutique if they would participate in CPO, they told me no, as they were already busy selling the new watches. True, there is always a line outside the boutique waiting to get in. Basically, the work would be done by the ADs, to buy and sell the pre-owned watches, not by Rolex directly. Even in the case of Bucherer, the CPO will be handled by a company it owns financially, but not tightly integrated in terms of operations. CPO to Rolex is risk-free, as its job is to inspect/repair/certify watches with fixed fees. The retail partners take on the risks of buying used watches and selling them, the same risks as WatchBox and Crowns and Calibers (Hodinkee).

Lange doesn't any ADs any more, so, their CPO will have to be handled by their own boutiques. I don't think that they have the resources or spaces to add the pre-owned watches.

If we consider Lange as business, it is selling the new watches at full retail prices (that are increasing every year), they have a great margin. Getting into CPO will hurt the new watch sales and drive down the margin. The CPO program may be even hard to make money, and it will tie up money to buy used watches.

Just my 2 cents. Thanks for writing and have a great weekend!

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