Watch Collecting – Some Thoughts On Value.

 

I have been a collector (not just watches) for as long as I can remember, and a key component for many collectors is value. For many of us value keeps the wheels turning. It enables us to finance, procure, replace, swap, and generally enjoy the collecting process. Sometimes we get the value equation right, and sometimes we get it wrong. If we are really clever we can make some money.

My first serious collecting category was tobacciana, particularly cigarette lighters. I was collecting when other people were throwing lighters away (sometimes timing is important) but the interest from collectors was growing and importantly it was a global thing so the market was quite large. Selling my first collection gave me the deposit on my first house – a life changer.

Then came mobile phones – those gloriously innovative and technically sophisticated Nokia’s and Motorola’s (who can forget the Motorola Razr or the Nokia Matrix phone?). Again these phones were being thrown away, but it turned out to be for a good reason. Mobile phones were being deliberately outdated with new systems, most notably the networks they operated on, as technology charged forward and rendered old phones (if you can call 6 years “old”) virtually unusable. Maybe one day interesting old phones will have a reasonable value but not right now.

Now I collect watches and the value equation is much better. Like cigarette lighters (and unlike mobile phones) watches have an ongoing usefulness and indeed the potential to be handed from generation to generation. Watches are still the most convenient way to tell time when out and about, and then there are all the complications, colours, sizes, movement types, straps, (the list goes on) that make watch collecting so engrossing and impact on value in so many ways.

Watch manufacturers are criticised for creating value through things like limited editions (yes, you Seiko), or restricted supply (yes, you Rolex). They do this to enhance the amount they can charge for a watch but I think the critics are missing a very important point. Creating additional value is not one way. The purchaser also benefits from the increase in value. No doubt Rolex owners (I am not one) get great confidence from knowing that their purchase is likely to maintain or increase in value. I am not complaining that the Seiko Starlight (SRPC01) purchased for $575 three years ago is now worth double that price.

And just yesterday I had another interesting value experience with a watch, actually two watches. My collection is now large enough that I can finance a watch purchase by selling something else in the collection. I am sure this is a common process for watch collectors who buy, swap and sell. I had sold three lesser watches and had my sights set on a Seiko “Save The Ocean” Turtle, the Dark Manta version. It had a RRP of A$995 but I was confident of picking one up for closer to A$700 by going online. After some due diligence on pictures, videos and reviews I needed to see one in the flesh, so off to one of Australia’s largest shopping centres (Chadstone) to check out the offers. I was quite prepared to buy from a store if the price was close to the online offer.

Angus & Coote had a good selection of Seiko’s including the Dark Manta in the Seiko Turtle and Seiko Samurai configurations. They are both gorgeous watches. But what caught my eye was two more basic references – a Seiko PADI Turtle Special Edition SRPA21 and a Seiko Samurai SRPC07, the orange dial version. Both were marked 50% off RRP. The Shop Assistant explained that she had just put them on special because the models had been discontinued by Seiko, and were no longer available.

As a 40 year retailing veteran I understood cutting-your-losses on no longer available lines, but in the watch industry there can be another impact. These watches could become more desirable if no longer in production. In other words more collectible. Both were unusual enough (the PADI version was a Special Edition, and the orange dial on the Samurai was unique) to suggest that this could be a great value buy. I decided to put off my original purchase and bought the two special priced watches instead. 

The Seiko PADI on the left is my first Turtle style watch, and I have already replaced the metal bracelet with a leather strap that matches that lovely dial (I know, not quite right for a diver.) If Billy Connolly was in the room he would say that Seiko Samurai on the right is not orange, it is ORANGE!!!! And again, I have replaced the metal bracelet, this time with one of those supremely comfortable elastic nylon straps.

I am confident that these purchases have added value to my collection. At the time of writing, the cheapest online price for the Seiko PADI Turtle is 40% more than the purchase price. In the case of the Orange Samurai the online price is 50% higher.

Now, maintaining value depends on many factors. Brand is important and in the lower end of watch values it would appear that Seiko has great potential. Kickstarter brands, even good ones, are notorious for quickly losing value ex showroom. Well established brands are more likely to succeed here but each watch brand will have different value potential.

Picking a well known, well respected brand, taking note of the ebb and flow of production lives, noting special or limited editions, and reading consumer sentiment on particular watches can all help to keep your choices value oriented and add enjoyment to watch collecting. You might even make some money.