In sign of times, luxury watchmaker Audemars embraces second-hand

GENEVA: Swiss luxury watchmaker Audemars Piguet said it would launch a second-hand business this year, becoming the first big brand to announce plans to tap into a fast-growing market for pre-owned premium watches.
The company said it had carried out a test run in one store in Geneva and would launch the business more widely at its outlets in Switzerland this year. If this proved successful, it said it would roll out the operation in the United States and Japan.
“Second-hand is the next big thing in the watch industry,” Chief Executive Francois-Henry Bennahmias said in an interview at the SIHH watch fair in Geneva this week.
Luxury watchmakers have hitherto eschewed the second-hand trade, fearing diluting the exclusivity of their brands and cannibalising their sales. They have instead ceded the ground to third-party dealers.
But some are now looking to change tack, driven by an industry-wide sales slowdown combined with a second-hand market that is expanding rapidly, fuelled by online platforms like Chrono24 and The RealReal.
“At the moment, in watches, we leave it to what I call the ‘dark side’ to deal with demand for pre-owned pieces,” added Bennahmias, whose company is known for its octagonal Royal Oak timepieces that sell for 40,000 Swiss francs ($41,680) on average.
“Anybody but the brands (is selling second hand) — it’s an aberration commercially speaking,” he said, without giving any details about how they would price pre-owned watches. Several smaller brands, including H.Moser & Cie and MB&F, have signalled interest in the second-hand trade.
“It is important to control the sale of second-hand watches to protect the owners and the value of watches already in the market by keeping the grey market in check,” H.Moser & Cie boss Edouard Meylan said.
MB&F, which plans to launch second-hand sales via its website this year, said it expected to typically give a 20-30 per cent discount on second-hand watches. A spokesman said customers buying from established watch brands could feel confident they were getting genuine products in good working order and with a valid warranty.
Bigger brands Rolex, Patek Philippe, Swatch Group, Richemont and Breitling all declined to comment, when asked whether they planned to enter the second-hand market, while LVMH’s watch division was not immediately available.
Audemars Piguet said it would launch its second-hand business in several, but not all, of its 26 Swiss outlets, but declined to specify how many stores or give a more precise date.
It will initially allow customers to trade in old Audemars Piguet watches as part-exchange for new ones, and then sell on the second-hand watches. It has not yet decided whether to buy second-hand watches for cash, added the firm, saying its sales had come close to the 1 billion Swiss franc mark last year.
Experts say the second-hand luxury watches business, mostly done via online platforms or specialised retailers, is growing rapidly as a new generation of customers that values variety more than permanent ownership enters the luxury world.
— Reuters