Sunday, December 23, 2018

We Sail Tonight For Singapore - Part the Third

From Singapore, by Tom Waits - 

We sail tonight for Singapore
Take your blankets from the floor
Wash your mouth out by the door
The whole town is made of iron ore
Every witness turns to steam
They all become Italian dreams
Fill your pockets up with earth
Get yourself a dollar’s worth
Away boys, away boys, heave away

So the November numbers are in, and because it appears to be my lot in life to be (if not the lone) one of the few contrarians out there in the watch world, here goes -

Courtesy of the FH
Again, the image is sort of fuzzy, and I do apologize for that.  But truth be told, the results are more than just a wee-bit fuzzy themselves.

The first thing to notice is that the numbers are going rather retro.  Now in fairness, they are much better than this time last year.  But if we are looking at them objectively, it is safe to say that they have been slipping the last 3 months.  And it is also safe to say that the only reason that they are as good as they are, is the push to shove as much product across the borders of the various cantons before the new regulations go into force.  

But then it gets more interesting when you factor in the countries that are "up" versus "not-so-up".

Curious to relate?

Mighty Singapore is once again back with one of their semi-annual market surges this time of (wait for it) +9.5%.

Now in the interest of total transparency, the closest I have ever come to Singapore was when my girlfriend (at the time) left Japan to return home to the UK and spent a week in Singapore and sent me postcards and letters from the Raffles Hotel in, you guessed it, Singapore.  Well, needless to say that relationship did not stand the test of time, nor do I suspect that the recent (again, semi-annual surge) of watch exports to Singapore, truly signals their emergence as a world hub for buying watches.  Now as a source to "source" grey market watches for global "discharge"?  Sure!

Even stranger, the US is apparently the darling of the industry with a mighty surge of + 17.6%.  Curious to relate (again) this export figure does not nearly match the (granted anecdotal) evidence provided by several US retailers that I have spoken with.  Of those I have spoken with?  Sales are pretty flat.  

Once again, at the risk of being, well, honest?  If the export numbers don't correlate with the "on the ground" feedback about actual sales, it tells you one clear thing that further informs other points -

1.  Watches are being exported to subsidiary offices to get them off the books at Swiss HQ.

2.  Watch sales are flat in North America.

3.  The grey market has PLENTY of product to sell.

The industry has not recovered.  Sorry, but it hasn't.  On the positive side?  Several brands have reduced their production to match real world demand.  The problem?  There was way too much product sloshing around that had to be flushed through the system.  And short of crushing watches?  That means our old friend the grey market.  The good news?  Lot's of affordable (let's call them price adjusted to reality) watches will now be available!  And hey, don't worry about the warranty!  You'll get some chicken-shit after market warranty for your pennies on the dollar purchase.  

It is a tired, skipped record from this d-jay, but simply put.  If you buy a grey market watch at a bargain price?  Don't lose your shit when that watch is worth even less than you paid for it when you are hoping to re-sell it.  Along with the grey market?  The Sunk Cost Trap is alive an well!

Enjoy your watches, and spend your money carefully!

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