A major reason watchmakers need to be careful with hiking prices is that luxury watch pricing is very much a one-way street – where going backward is a very painful and unsustainable experience. Why? Because it is very easy to become a discounted luxury brand where customers quickly grow accustomed to calculating with and expecting an ever greater discount – once you’ve become a discounted brand, with a damaged image and pricing power, reestablishing the practice of systematically selling at retail becomes an extremely costly and often borderline impossible undertaking to accomplish. This is why, in 2018, for example, Cartier has ended a two-year inventory buy-back spree where it has purchased back 500 million Euros worth of stuck Cartier luxury watch inventory, all in an effort to avoid becoming a heavily discounted brand.

And so, the wiser luxury brands tend to exercise caution when increasing their suggested retail prices – which, mind you, already contain a hefty profit margin. For that to happen, at least one of two things has to be in effect, and to a sustained and heightened extent. For one, costs related to manufacturing, distribution, or marketing have to have climbed considerably, and without the promise of a decrease. Two, there has to be a demand that greatly exceeds supply. There have been luxury brands in every industry that have enjoyed momentary success, empowering them to jump the trigger and raise prices on existing products too fast – or abandon bread-and-butter collections and jump into a price bracket a category or two higher. Making a successful return after the often inevitable falling from the grace of the buying public is an even greater accomplishment than building a successful brand.

In short, there are many mid-to-long-term reasons why exercising great caution when hiking prices on luxury products is the prudent thing to do. And if there is one luxury brand that gives itself all the time in the world, planning for the long-to-very-long-term, free from the pressure of growth- and dividend-hungry investors of any kind – well, that would be Rolex. And so, for Rolex to increase prices, it is safe to say that both those aforementioned factors have to come into play – and come into play they have. It is fair to assume that pandemic-related safety measures, an admitted shortage in capable watchmakers (and all other professionals involved in the designing, manufacturing, finishing, and assembling of a fake luxury watches), and inter-industry cost increases (affecting suppliers of base materials, tools, etc.) have all taken effect.

The first days of 2022 introduced considerable and noticeable Rolex price increases, especially on steel luxury watch models. In this article, you will find the retail price increases on the most sought-after Rolex watch collections, along with our commentary.
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Relentless inflation, increasing wages, and other costs of manufacturing, pandemic-related extra expenses, and a host of other catalysts have recently been driving prices of just about every consumer product sold in the developed world. Singling out watches, let alone a single watch brand, isn’t exactly fair, but it is necessary. So, let’s begin by saying two things.

First, given the aforementioned, it really is no surprise that wristwatch retail prices across the board will increase in 2022. Second, we are going with Rolex as an example because, in many ways, it dictates the actions, mood, and strategy of the greater watch industry – even by the admission of other major luxury watch manufacturers. According to Morgan Stanley research, Rolex accounts for one-quarter of the entire swiss replica watches industry’s annual turnover, based on an implied retail sales value of CHF 8 billion in 2020. So what you are about to read regarding Rolex is likely to soon happen to the luxury watchmaker of your choice.

Contrary to the practice of most other major luxury watchmakers, Rolex admirably publishes the manufacturer’s suggested retail price (MSRP) of just about every regular production model prominently on the product’s respective page. Excluded from this rule are some of the ultra-high-end precious metal, high-jewelry, and “if you have to ask, you definitely can’t afford it” types of pieces. In a world where a great variety of regular-production Rolex watches are selling for 30-50% over retail, and sometimes a whole lot more, one thing Rolex can’t be blamed for is not making this piece of information available to you. How wrong / desperate / stupid / vulgar (pick one or more) it is to severely overpay for any watch beyond its retail price, we at Watch have authored many articles about, as well as on the supply and distribution issues and global dynamics in demand – including this year’s April’s Fools article where the joke was on Patek Philippe.