When you picture luxury, wealth, and success, a few specific things likely come to mind. You may picture a diamond ring, a mansion, or perhaps even a sports car. Many people picture a Rolex. They’re the height of luxury – something to aspire to and a rare indulgence that showcases success. Owning a genuine Rolex signifies that you’ve made it and earned something high-class and beautiful to signify it.
Why is that? What makes a Rolex so special? Why are they so expensive and worth enough to be synonymous with the image of success and the idea of wristwatches in general? There are several reasons behind Rolex’s rise to fame, value, and following. It might be tempting to dismiss them as overpriced, but those numbers came from somewhere. This article seeks to explain them and convey just what makes Rolex valuable.
The History of Rolex
To understand how Rolex watches became what they are today, you must first understand how they started.
Rolex began in 1905, but the company didn’t develop its own brand until three years later. The company itself is heavily tied to watchmaking in general. By the time Rolex was founded, wristwatches were less than a hundred years old in general. While other timepieces (like the pocket watch) existed previously, wristwatches were new territory. Rolex and its founders, Hans Wilsdorf, and Alfred Davis, eased in on the ground floor.
Wilsdorf and Davis were able to experiment with designs and quickly built a name for themselves and their business. By 1925, they’d invented the first waterproof wristwatch and gave the world the first Perpetual rotor (an automatic or self-winding mechanism) in 1931. Their string of innovations continued throughout the 20th century until they amassed their current tally of around 500 patents.
In other words, Rolex as a company is not simply for show. It’s been a groundbreaking, innovative watch company since it opened its doors nearly 120 years ago. In all those decades of business, Rolex has created elegant watches to impress and practical watches capable of surviving deep sea dives. Rolex earned its place in the watch world, and there’s a rich history backing it up.
An Admirable Design
History isn’t everything, of course. You can’t base current value on what a company achieved years or decades ago. Fortunately, Rolex’s most sought-after qualities stand the test of time and are still used in making new watches today. Along with the backing of the name itself, Rolex watches hold value because of their high level of craftsmanship and premium materials.
Rolex’s choice of steel sets it apart from its competitors. Within the brand itself, the steel is referred to as “Oystersteel” – otherwise known as 904L stainless steel. It’s an incredible material, known to be highly resistant to corrosion and considered a superalloy.
On the other hand, much of Rolex’s competition uses 316L stainless steel, or surgical steel. It’s easier to work with than 904L and costs less overall. 904L requires a further level of craftsmanship, and it holds more shine and strength than the 316L favored elsewhere.
The extra effort it takes to work with 904L and its higher quality level overall both affect its price. Rolex’s higher prices reflect those material costs. Oystersteel is strong enough to weather the highest mountain peaks in the world, as evidenced by Sir Edmund Hillary, and up to 100 meters beneath the ocean. They’re quite literally built to withstand any extremes a human being might venture into.
That’s the level and quality of material contained in Rolex watches, and it certainly accounts for some of their value.
Precious Metals and Stones
Along with its superb quality Oystersteel, Rolex works with genuine precious materials. Few watch companies in the world work with real gold. Rolex is one of them. Just as the company has always been dedicated to innovation, it’s also designed for elegance and luxury.
The company is so devoted to preserving the quality of its pieces, while still sticking to the aesthetic standards that make Rolex watches desirable, that Rolex developed their Everose Gold. Everose Gold is an alloy combining copper and trace amounts of platinum with pure gold. The combination produces a pink-gold hue that Rolex says will never fade or lose its red hue. Rolex’s pink-gold watches are some of its most popular models and they poured research into ensuring that they retained their look just as long and reliably as their structural integrity.
Rolex uses gemologists and jewelers to test, set, and create their pieces. The diamonds and stones are hand-set and the materials are thoroughly tested. Those higher price tags reflect the inclusion of materials like real gold, rather than the gold plating seen elsewhere, and authentic diamonds and gemstones.
Additionally, Rolex uses the same high-quality standards when choosing its diamonds, gemstones, and other materials as it applies to steel. You’re getting the best of the best. If you have your eye on a Rolex with diamonds or gemstones, they won’t be just anything. Count on hand-selected, top-tier stones. Rolex employs experts to select them, and you pay for both the quality of the material itself and the skill it took to find and pick them.
As you wonder about Rolex’s value, consider the cost of the raw materials alone, the steps it took to get them polished and primed for the watches, and then the labor required to assemble a luxury timepiece like a Rolex watch.
Research and Development
Rolex’s history of innovation and leading the way in the watch industry is well documented. It’s not a thing of the past, either. Rolex doesn’t simply coast on its old claims to fame. The company is still highly involved in creating and developing new technology, whether that’s seeking out new materials, improving design, or adding new features.
All of that requires an extensive research and development budget. Rolex maintains laboratories dedicated to furthering and improving their designs, using everything from electron microscopes to spectrometers. The company performs extensive testing on all of its products. Stress tests, movement tests, and wear tests are only a few parts of the rigorous process.
Of course, testing, research, and development require experts, too. Along with the jewelers and gemologists mentioned earlier, Rolex maintains a fantastic team dedicated to making the best, most innovative, and most durable wristwatches possible. Every step of that is reflected in their price. When you buy a Rolex, you buy the history and the future of watchmaking.
Because of the brand’s popularity and quality, demand tends to outstrip the supply of Rolexes. Whether you’re searching for a vintage piece or looking to purchase a new model, you can’t get them just anywhere – and you might not be able to locate the one you want even when you go hunting it down.
The value increases any time there’s a degree of rarity, which you see with Rolex watches. Rolex does manufacture a decent number of watches each year, with current estimates at around a million, but demand still outstrips production. That’s certainly true if you’re searching for vintage Rolexes, and you can expect value to increase with old models and watches.
In recent years, the brand faced production issues due to shortages and stalls in supply lines. Rolex refuses to compromise on the quality of its product, which has been a cornerstone for the brand since its creation. Even if supply lines slow down and there’s a lag in the manufacturing process, Rolex puts out the same product – even if the numbers are smaller.
Obviously, slowing down production affects how many pieces are available for purchase. The demand didn’t necessarily follow suit, creating a further disparity between supply and demand and increasing the rarity of Rolex watches.
Is the Value of Rolexes Inflated?
With some Rolex watches selling for millions of dollars, it’s fair to question whether they’re really worth it. Every individual person must answer that question for themselves if they’re legitimately considering purchasing a Rolex, but the general consensus is that Rolex watches are worth the price.
The numbers aren’t pulled from thin air, and it’s not simply a hollow price tag. The company’s contributions to watchmaking, its commitment to using high-caliber material and craftsmanship, and the relatively small production numbers all work together to increase the value of a Rolex. Those are legitimate (and compelling) reasons, especially when the prices of models vary from a fairly reasonable $5000 all the way up to millions.
Whether you’re a collector, looking to diversify your portfolio, or just in the market for a prime-quality timepiece, there’s a Rolex out there for you. Whatever you pay, you can count on exceptional quality and the best materials on the market. Rolex committed to that from the beginning and hasn’t wavered.
Ultimately, that’s the reason for their value – they’re a major part of watchmaking history and, in many ways, made the wristwatch what it is today. That holds meaning beyond monetary worth. With each Rolex, you get a little piece of the company and wristwatch history.
Harry Glinberg Jewelers has a wide variety of fine Rolex pieces on hand for purchase. If you’re in the market for a new Rolex then reach out today and we’ll set up a time for you to have an exclusive one-on-one with Harry to review our selection. If you’re looking to trade in your current Rolex for a newer model, or just looking to sell your Rolex Watch, we can go over options for that as well!