We’ve discussed time after time the peer benefits of owning an exotic car or a beautiful timepiece in Stay Poor. We even went as far as breaking down for you the Best Watches Under $3000 and some history on watch makers like Panerai and Hublot. Did you know that there is a spectacular market behind buying and selling watches? There are lots of people buying and selling watches around the world without even owning a jewelry shop or having access to auctions. This growing market has recently seen its best days with the recession allowing dealers and resellers to pick up some of today’s hottest timepieces at a fraction of their costs and making big bucks selling them back at the right time.
So here is a breakdown of how you can make major money buying and selling amazing watches…
Where To Start
With so many watches and different brands, its hard to even know where to start. As you may have heard me say before, making money is all about knowing what you are involved in in order to minimize risk and make your attempts more calculated. The more research you do, the more likely you are to succeed and the less mistakes you will make. Mistakes will happen and will occur more than once but the beauty of it is that just like the stock market, what you lose on one trade, you can make twice as much with the next. Here are some steps you should take with starting:
- Understand the market: Visit forums like Rolex Forums, eBay and TimeZone to gauge what pieces are moving, which are wanted and which are not selling. Also pay attention to asking prices and what pieces are selling for which amounts. Understanding the market and locations where pieces are selling is key.
- The capital needed: Start playing similar to fantasy football and see if your choices/picks would have been good. Decide ahead how much money you can afford to tie into timepieces and pretend to be buying some and check selling prices a few days later. Try to negotiate with sellers and sharpen your skills to prepare for when you actually have to buy your first one. Understand that putting money into watches is sometimes about timing and requires patience or losses will come your way.
The Buying Power
Cash is king as in every situation and more than ever in this scenario. Understand that with every hardship in life, things like jewelry and watches are the first to go. These hard times mean that you can pick up worthwhile time pieces at a fraction of the cost. So what is a good buy? Most dealers will buy watches at about 25 cents to 30 cents on the dollar for mint pieces, complete with boxes, papers and documents. Most deals should be negotiated as close as you can to those numbers. To calculate, simply take the retail price of the watch and take 30% of that, then try to negotiate buying watches as close to that as possible. The following brands hold true to that 30% rule: Patek, Audemars, Hublot, Panerai, Ulysse, Jaeger, and Rolex. All of which are high end pieces and should be bought at least 2 years old. Watches less than 2 years of age might bring closer to 50% due to their new nature and valid warranty card. Watches purchased from online sources instead of authorized dealers will bring in less than 30% and watches with wear marks, blemishes, worn down bracelets or lack of documents will bring in even less.
How To Sell
Selling is a bit harder than buying and requires you to actually exercise patience and fearlessness. Many times, people will lowball you trying to take your pieces for pennies on the dollar as you tried when buying yours. This practice is common and should be expected and shouldn’t be under any circumstance a reason for you to get disappointed and run with the poor offers you are receiving. Lowball offers are quite common and expected with every deal but real offers come through as well. Patience is required to make the best deals that work for you and timing is everything. There will be times when you list a watch for weeks with no hits and suddenly list it again and sell it in a few hours. There is always someone looking for that piece, you just need to make sure your piece is priced right and visible to all through watch and car forums as well as eBay.
How To Multiply Profits
Starting with a $10,000 budget is a good place to start and practicing with watches like Breitlings, Omega, Tag and other boutique watches is a good place to begin and learn. As you increase volume, profits, and listings you can certainly upgrade to the higher boutique brands and go further than $5,000 per watch but make sure to not get caught up by wearing all the pieces all the time. Many newbies make the mistake of showing off all the time wearing the watches in hot conditions and causing sweat to damage the alligator bands or accidentally hitting the watch around causing bezel swirls and nicks. Simply wear them a minimal amount of times and in carefully placed situations where damage and theft are minimized.
Hope this helps and make sure to pick up a copy of the new eBook Making 6 Figures a Year Wearing a Watch where we cover the step by step system on how to buy, sell, and profit big from watches. Coming in Fall 2011 in our Success Library.