Rolex Wants To Control Everything — From Making Watches To Distributing, Selling, Servicing, Repurchasing, And Reselling Them

Control. It’s all about control. If you’re not in complete control, others can and will mess things up, and you will be held responsible for it, resulting in a negative image. That’s one thing no luxury brand wants to have to deal with. That’s why Rolex intends to control everything, from creating its alloy to making the parts, assembling the watches, distributing them, selling them, servicing them, repurchasing them, and selling them again. “The Crown” wants to get a grip on every aspect of its watches’ life cycle. What are the implications of this?

In 2023, Rolex made history when it became the first Swiss watch brand to surpass the CHF 10 billion threshold in sales. That year, it reinforced its dominance by cornering an impressive 30.3% retail market share. According to Morgan Stanley and Luxe Consult, a year later, the market share went up to 32.1%. To put that number in perspective, that’s 300% more than the closest competitor, Cartier, with an 8% retail market share. And do you know what? Rolex’s share of the pre-owned luxury watch market is much bigger. According to vintage Rolex seller Bob’s Watches, The Crown has a market share of 73.8%. The brand dominating the market also wants a firm grip on other key elements involving its product. Rolex wants to do it all, and this includes, among other things, controlling where the product is sold and serviced.

Rolex’s headquarters in Geneva

Rolex wants to control everything

When you sell over a million watches annually, keeping them close after the initial purchase is potentially very lucrative. When you sell your in-house product at an in-house point of sale, service it in an in-house service center, buy it back, and sell it again at an in-house pre-owned dealer, the principle from the cradle to the grave applies to watches and their buyers. Rolex wants to be involved in the full life cycle of its product, from its creation to its demise, although a cared-for and well-serviced watch, theoretically, has eternal life.

Rolex Explorer II ref. 16570

Roll-out of the Rolex Certified Pre-Owned program

Rolex has been making watches since the early 20th century and has steadily worked on becoming the number-one manufacturer of luxury watches. Recently, the brand seemed to have upped its pace to further strengthen its position in the lucrative luxury watch market. In 2022, Rolex started its Certified Pre-Owned program. This began with Rolex “CPO” watches for sale at Bucherer boutiques in Switzerland, Austria, Germany, France, Denmark, and the United Kingdom. In two years, the CPO program saw a fourfold expansion. Apart from Bucherer, some approved retailers, like Dutch retailer Gassan and US-based dealers Mayors and Tourneau, also became part of the program. The number of approved retail partners rapidly grew from 25 to 107, meaning 217 physical locations globally.

Rolex CPO seal of approval

The program works as follows. First, the CPO retail partner sources used Rolex watches at least three years old. Rolex then checks these watches for authenticity; they are certified and guaranteed if they pass the test. A CPO Rolex comes with a fresh two-year international factory guarantee and shows a physical seal to prove it. A CPO Rolex is a safe choice, but prices are above retail for most pre-owned offerings. That’s the price for peace of mind, something many (inexperienced) watch buyers are willing to pay. Rolex profits from this in every single way.

Bucherer’s flagship store in Lucerne, Switzerland — Image: Bucherer

In-house sales

Speaking of in-house sales, in 2023, Rolex acquired Bucherer, a multibrand retail store with more than 100 locations worldwide, to gain greater control over brand sales and the overall customer experience. This move strengthens Rolex’s retail presence and allows tighter control over pricing and the availability of its watches, especially for high-demand models. The strategic purchase also positions Rolex to reduce reliance on third-party authorized dealers while potentially expanding its access to additional production capacity. Thus far, 53 Bucherer locations operate as authorized Rolex dealers. Besides that, Bucherer also operates a large after-sales service operation for the brand, and it’s on this aspect of a watch’s life cycle that Rolex is now focusing.

The entrance of a Rolex after-sales service center

In-house after-sales servicing

According to Jing Daily, a leading digital publication that focuses on luxury consumer trends in China, Rolex is reportedly taking decisive action to consolidate its control over distribution and after-sales service. Reportedly, the brand is shuttering third-party service centers, particularly in key markets like China, to likely strengthen its grip on every aspect of its timepieces’ life cycle. The closure of independent service hubs would suggest more than just a logistical step in gaining complete control over the product. It would also mean more control over customers. If you don’t buy your new or pre-owned Rolex from Rolex for the price Rolex dictates and have it serviced by Rolex for a fee Rolex sets, you’re on your own and cut loose.

Who’s out?

Rolex controlling every aspect of its watches’ life cycle also means the company tries to cut out scalping gray-market dealers. This will also affect how collectors buy, sell, and maintain new and pre-owned watches from The Crown. If Jing Daily is correct, this strategy will lead to Rolex hubs containing a regional distribution center, sales salons in carefully curated Rolex style in which new and CPO watches can be bought, and an after-sales service center.

Scalpers might become welcome victims to this one-stop-shop strategy, but what about those existing independent Rolex-certified service centers? Additionally, the quality of the service seems to be guaranteed when controlled by Rolex, but what about the speed of the after-sales service?

The answer to the first question is that once this program rolls out, it will cut out third-party service centers, regardless of the certification. As for the speed of operation at a centralized service hub, it will take a lot of experienced manpower and a flawless logistics operation to have such a large service center at the level of excellence Rolex swears to uphold. Are these hubs a rumor or a certainty? We will see in time. And remember, like the CPO program, once the initiative starts, it will continue to roll out worldwide.

In-house everything

Former Rolex CEO Patrick Heiniger (1950–2013) would have been proud to see virtually every aspect of the watch business under the brand’s direct control. Heiniger marked the company’s history throughout the 16 years he was at the helm from 1992 to 2008. Under his leadership, Rolex made a pivotal strategic decision in the mid-1990s to vertically integrate its production processes. This move aimed to secure control over the manufacturing of key watch components, thereby ensuring the brand’s autonomy.

Controlling every aspect of the watch game in and outside the production facilities — thus, making the rules — is taking Heiniger’s vision a step further. It’s a strategy that requires a serious investment. Rolex can afford it. Although the company is under the management of the non-profit Hans Wilsdorf Foundation, which keeps Rolex’s annual profits a closely guarded secret, considering the very healthy margins in the world of luxury watches, the brand’s 2024 revenue of CHF 10.58 billion means it’s very profitable indeed. So, if Rolex wants to do it all, the company will. It does feel a bit like Big (Watch) Brother is watching you, though.

What are your thoughts on this development? Does the Rolex strategy comfort you or just the opposite? Please let me know in the comments section below.

All images are courtesy of Rolex unless otherwise stated.