About Certified Pre-Owned watches and buying one

An introduction

Online luxury watch sellers were always eager to use the word authentic, but now the new thing to say is "Certified Pre-Owned". Or also referred to as "CPO". When you Google it you will find online retailers selling pre-owned luxury watches like Rolex, Breitling, Omega and many more. The word is mainly meant to give a certain level of comfort, but is it marketing or does it really stand for something? 

What does Certified-Pre Owned mean?

A Certified Pre-Owned watch means that (1) a watch is pre-owned and (2) certified by a certified watchmaker. Certified in essence will tell if a watch is authentic and in accordance with the brands quality standards.

However, some sellers are not certified dealers. Basically anyone can say he sells Certified Pre-Owned watches. We will explain how this works and why this matters in a bit.

Where does CPO come from?

The word Certified Pre-Owned was originally founded in the car industry. You could drive up to a Mercedes Benz dealer (or any other one) and find new cars and Certified Pre-Owned cars in the same showroom. It was a business model where new cars could more easily be sold by letting the buyer hand in his car for a discount. This would provide the opportunity to gain a loyal customer and on top of that make a good margin on a pre-owned car.

Certified Pre-Owned watches offered by Bucherer in store (credit: Bucherer)

Why is CPO relevant for the watch industry?

Pre-owned watch market is growing

The pre-owned watch market is growing at a tremendous pace and is currently around $9bn in 2021 and expected to grow to c. $14bn in 2025. The pre-owned watch market is mainly dominated by so called grey dealers. These dealers are not authorized brand dealers, but only trade in pre-owned watches. The brands see a big opportunity for earning an additional margin on CPO. By selling more new watches and also making a margin on selling the traded pre-owned watches. Whereas some (online) dealers are heading out with a big Certified Pre-Owned watches for sale sign, the big brands like Rolex, Breitling and others are really at the start of finding out how to gain a share within the pre-owned watch market.

Higher margins for CPO dealers

Some watch models are in such high demand that they are only available at pre-owned dealers. Resulting in authorized dealers who are losing big margins as they are not allowed to ask a price that is above the RRP (Recommended Retail Price). An example is a Rolex Daytona in steel with a white dial, for let's say a RRP of €12.5k. The margin on watches is what we think about 40%-50% for retail. So an authorized dealer would make c.€6k margin. While a grey market dealer can ask the market value price at €25k, making a margin of €12,5k! Authorized dealers don't want to miss on this opportunity.

The problem of fake and incorrect watches

The biggest risks for a pre-owned watch buyer are authenticity and quality. A luxury watch is generally a big purchase and you want to avoid buying a fake or incorrect watch. Therefore, people are willing to pay a premium to be sure to buy an authentic watch and preferably in good quality. Since grey market dealers are as they say "dealers" and not watch makers, there is added value if a watch is checked by a certified watchmaker.

More official brand dealers like Bucherer and Schaap & Citroen start selling pre-owned watches. Making sure they are not missing out on the high margins that can be realized on the pre-owned watch market. But is it real added value or marketing?

 

Benefits of buying Certified Pre-Owned watches

The essential benefit is that an experienced watchmaker has observed the watch on authenticity. Service and warranty are most of the times redundant. Because not all pre-owned watches need a full service. And the problems with a watch are easily deferred as your own damage. Making sure the seller will not be held accountable for problems that fall under the warranty.

Is a Certified Pre-Owned dealer trustworthy?

There is no institution overseeing CPO watch dealers. So CPO dealers are not directly trustworthy dealers.  

Some CPO dealers are also authorized dealers (for example Bucherer or Schaap &, Citroen). But some who claim to sell CPO watches, are not authorized dealers (such as Chronext or GrayandSons). There is no institution who provides a certificate to CPO dealers nor is there anyone who oversees CPO dealers. So unfortunately anyone can say they sell Certified Pre-Owned watches on their website. We only know that certain watch brands go after sellers who claim to have "certified watchmakers" in service, while they are not authorized dealers. This is to protect their own heritage and quality standards, which they control via their own brand training and (co-)brand retail stores.

So trustworthiness is not a given word if somebody claims to sell Certified Pre-Owned watches. Although many CPO sellers claim all watches are serviced, authenticated and sometimes even come with an additional warranty, there is not much more than to believe their word and their history. And how valuable actually is an authenticity check, a full service and a warranty? We will explain this next.

Extended warranty

We consider the extended warranty at CPO dealers not at much value as most of all damage claims are deferred as "own damage". Making you responsible for the damage and not the seller.

For a buyer it is hard to make your case if after 10 months the timekeeping is less accurate. Was it a fault during service, or did you drop the watch? I think you can guess what the dealer will say.

Is a Certified Pre-Owned watch the best buy?

Dealers will argue that a Certified Pre-Owned watch is the best buy as it is serviced and authenticated by a certified watchmaker. But completely servicing a watch is expensive and in many cases not necessary. As such we would say that a regular pre-owned watch on a regular marketplace could be a better value for money.

In general the best buy is directly from a private person. They don't have fancy offices or any other expenses that dealers have. Examples of market places are Relleb.com, Chrono24 and eBay.

Certified Pre-Owned watches for sale

Overview of CPO dealers

We only consider parties who are authorized dealers themselves and sell pre-owned watches. 

Certified Pre-Owned watch dealers 

• Bucherer (Switzerland)
• Schaap & Citroen Vintage (Amsterdam)
• Tourneau (USA)

Feel free to inform us when you have any other CPO dealers to add to this list.

Where to find the best CPO deal

In order to find the best deal when buying a pre-owned watch, we would advise to search on market places with private sellers. Like eBay, Chrono24 and Relleb.com.  As said before, private sellers don't have fancy offices or other expenses and are more easy to negotiate with if you want a good price. 

The crucial question then is how to get if certified? Well, find an authorized dealer, a watch expert or buy online with an Independent Authentication Service. This will ensure you buy an authentic watch and gives assurance over the quality. It will save you a big premium for the high end authorized dealers and a costly service which is in many cases not necessary. The extended warranty some CPO dealers sell with a watch, is not of much value as most of the time they defer warranty requests as "your own damage" to the watch. 

A Rolex Daytona with a Relleb authentication tag. Customers also receive a full authentication report, comprising details of all steps supported with pictures.

Is CPO added value or marketing?

In our opinion Certified Pre-Owned watches are mostly marketing. The authentication and quality assessment is added value. But a redundant full service and a warranty guarantee that is often deferred, is no value at all. Being a Certified Pre-Owned watch seller does not guarantee anything. As you can see on the image below, CPO dealers have their own "certificate". It is not a regulated process nor is there any oversight on CPO sellers.

As such, we would advise you to buy a watch and have it authenticated by a certified watchmaker. In that way you can easily safe a 10% on buying a luxury watch online.

Certified Pre-Owned watch sellers with their own badges and cards.

Do authorized dealers sell new watches directly as CPO?

Is essence this is not allowed at all. Brands like Rolex and Patek Philippe even prohibit authorized dealers to sell pre-owned watches in the same store!

Many watch enthusiast are annoyed by the fact that new Rolex sport models are unobtainable at the authorized dealer. But are available around the corner at the CPO store with the same owner. We have no proof that watches are being sold directly through the CPO store. However, there is a risk of conflict here. Because a watch sold as CPO can triple the margin for a dealer, there is an incentive for a brand dealer to sell the watch through it's CPO store. What do you think the average sales minded person would do?

The future of Certified Pre-Owned

The word on street is that CPO will be integrated by the brands themselves. Brands will sell Certified Pre-Owned watches next to new watches in their own boutiques. So no retailers with multiple brands will exist anymore over a certain time. Several brands have already expressed their focus on CPO and are "busy" integrating CPO in their stores.

We are not sure how the pre-owned market will evolve. Nor if indeed there will be any retail stores selling Rolex, Cartier, Audemars Piguet and Breitling next to each other in 2025. But there is a lot happening in the market for pre-owned watches. The future will tell us more.