Time passes and things don’t change much in the Rolex shortage of watches. Customers still complain about the time to wait to get a Rolex timepiece, especially a sports one. So, people still wonder about the reason for this phenomenon. Is this a deliberate marketing strategy of the big brand? Or, the number of millionaires around the world constantly increases and the brand indeed is restrained in satisfying the market needs? The possible hypotheses go beyond these two potential explanations. People don’t stop talking about this issue and the brand seems to be ignorant about it.
I’ve met plenty of people who have enough money to buy a genuine Rolex. But they opt for high-end imitations. The reason? They say to be frazzled about the endless waiting list. Some even say that is not about the company itself producing this shortage; it’s rather about the authorized dealers that seem to have fun from this chaos. Why would dealers do so, you may ask? Well, this holding-back “strategy” leads to the increase in the street price of Rolex watches. But, again, this is just one of the available speculations.
Either way…
Rolex did react to this whole fuss, explaining that the shortage is a pure consequence of the extraordinary demand never met before. It makes sense, but only to a certain extent. The skepticism gets bigger when you just begin contemplating a little bit: are there really THAT many people affording an expensive watch? And did the number of wealthy persons become THAT high for a giant like Rolex to not be able to meet the demand? This question is going round and round in my head. I just can’t help to compare Rolex with, let’s say, Apple, which is also a giant in its field. The demand for Apple devices is astonishing. This brand is by far the cheapest one and still, everyone can get an Apple device. So, what’s really going on out there?!
Supply
The first thing that comes to mind is that the company technically cannot face the market demand. And it doesn’t really matter what the official position of Rolex is. It can explain the way it wants, but the fact is that the number of timepieces it produces is simply not enough. And it’s not me saying this, it’s the numbers, which never lie.
To go a little deeper into the subject, let’s do the math together. Rolex never reveals its numbers, and that’s understandable why. Still, professional journalists from reliable magazines have done their own research on the matter. They state that the approximate number of watches produced is about 1,05 million watches a year, at least, for the last two years. If we look retrospectively, Rolex has increased its watches’ prices several times during the last 5 years.
Why would it do so?
Some of the reasons include inflation, the stock market, increase in materials prices. But, one of the hidden reasons for increasing prices is to lower demand, don’t you think? With higher prices, the number of people being ready to pay them would significantly drop, in theory.
On the other hand, another curious thing refers to the fact that back in 2015, the COSC agency revealed some numbers about several watchmaking brands. According to statistics, Rolex had certified about 800,000 timepieces in those times, which means that it produced fewer watches in the past than it did in the last two years. So a hypothetical conclusion is that the brand did increase its number of produced watches if all the data are realistic. Still, the shortage is more imminent than ever.
Demand
To be fair, I had to look at both sides of the coin. The truth is that it’s much harder to analyze the “demand” aspect, as it’s more difficult to quantify. I thought it would be necessary to consider the number of people affording a Rolex, the number of those who desire one, and the overall number of overall millionaires on the planet. I admit that this formula is a pretty crude one but I must consider all those aspects to come to an approximate conclusion.
Reducing the complex formula to its easiest version, I consulted some sources indicating the overall number of millionaires in the world. For the 2022 year, there were about 47 million millionaires globally. This reference number might slightly differ from source to source, but on the whole, it’s somewhere there. So, after doing the math, it turns out that one Rolex timepiece is available per 1 out of 44 millionaires, more or less.
So…
Considering that the number of watches produced has increased in the last few years, the number of millionaires has also increased. As a result, the proportion didn’t change much. Still, that’s not the whole story. There are other aspects to consider, making things even more complex. For example, the official data on millionaires doesn’t include those who are not millionaires but do afford a Rolex. Add to this the fact that even a person who doesn’t afford a Rolex right now will make some savings to get it next year ( if he ever gets one, because of the endless waiting list). Not to mention the shortage generated by the recent pandemic, making the Swiss watch industry export 21% lesser than usual.
Final thoughts
The factors influencing the Rolex watches shortage are endless. Each of the factors drags another one and the cycle goes on and on. The major question here is if this situation is going to last forever. In my perception, yes. There is always going to be a shortage of Rolex watches and I think it’s time people begin taking it as an absolute truth.
Just think of it: the production of 1 million watches a year is not a small number. The process of producing and assembling timepieces of that quality requires particular attention to detail, concentration, and pedanticism if you want. So, Rolex could only increase the amount of produced watches if operating faster, to gain quantity. But quantity might compromise quality.
On the other hand…
The company could hypothetically extend even more, hire more experts and expand its borders. In such a way, it could produce more watches to satisfy the big demand. But, here rise two critical points:
-even if the company produces more watches, the number of people affording one will proportionally increase. That’s what we saw in the above-mentioned statistics. Millionaires increase in numbers and it’s not a fact that Rolex will handle that either way, even with enhanced production;
-the second critical point is: does Rolex really need to meet the market demand?! Why would it have to please anyone? The fact that people want these watches doesn’t always mean that they must have them. So to be honest, I think the Rolex shortage is not a deliberate strategy of the company; it is rather a beneficial side effect enhancing brand exclusivity. Or, would the brand still be exclusive if everyone owned a Rolex watch?!
I know, we are talking about millionaires here. And you might wonder why one of them would be deprived of a Rolex watch if he can afford it just like the other millionaire does. The explanation for this is as philosophical as it can be: luck.