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February 3, 2006, Newsletter Issue #3: Where non-affiliated dealers get their goods
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Tip of the Week
There are multiple ways watches can get off the intended distribution path. The distributors themselves are often the source. There are a few reasons they will do this. If a group of items has been discontinued, or slightly updated with a newer version, they will need to move the older versions out the backdoor. This allows them to clear up capital and make room for new watches and is a common practice. If the distributor has too many of a certain watch due to sales expectations not being met, they´ll again move them out the backdoor. They will typically sell a complete lot to one wholesale dealer who then pieces up the lot and sells it to various Internet dealers who sell to consumers. The end result is a fully authentic Swiss watch, at a much better price.
Some dealers have connections with authorized dealers, and can order watches directly from them. This is not a practice the watch manufactures approve of, as these authorized dealers are supposed to be selling them only in their brick and mortar stores. Most manufactures will state on their websites that they do not have any dealers on the Internet. These items will often get the name of "Grey Watches". In order for the authorized dealer to stay out of trouble with the manufacturer, they will remove the serial number from the watch, which does more than just invalidating the warranty. Any sort of after-sales work on the watch by the manufacturer will not be possible, even if you are willing to pay full price for the services. Most companies will not even recognize the item as legitimate and will return it to you without even looking at it.
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