It’s a known fact that during the pandemic, luxury watch sales soared. With so many people at home and indulging in their passions – some even discovering watch collecting for the first time – even the sales of pre-owned watches climbed. With that huge interest, and with somewhat reduced production of watches due to factory closures during COVID, prices also soared. But, what goes up usually comes down. This is the case now with the prices of certain pre-owned watches. And, as prices decline, some online watch retailers of pre-owned pieces are retrenching. Both Chronext and Chrono24 (sellers of pre-owned watches) announced a rash of layoffs. Swiss Watch Expo, though, continues to grow.
According to Eugene Tutunikov, CEO of the family- operated Swiss Watch Expo, the store is stocking more watches than ever, hiring more people and witnessing an increase in sales. In 2022, sales reached $80 million, up five percent over the previous year. “I am expecting sales of $100 million within two years”, said Tutunikov. “This year might be hard to hit that number but is possible if the global economy and demand boom in the second half of the year.” He also noted that February 2023 sales were already up 7.5 percent over February of 2022 in terms of units. In that short 28-day month, the retailer sold 715 watches.
With one of the largest inventories of pre-owned Rolex watches in the United States, Swiss Watch Expo says its greatest number of sales by units, and the large majority of its inventory, is in Rolex – with 50 percent sales and inventory in this brand. Also important are Cariter, Omega, Breitling, Patek Philippe, and some Audemars Piguet. But, collectors are bound to happen on almost any luxury brand they are looking for since, at any given time, the Buckhead, GA, retailer has approximately 3,000 watches in stock (and listed on the website). With turnover happening daily.
“When it is literally all your money, you are very very careful,” said Tutunikov, noting that the family owned company is very careful about the watches it buys and sells, as well as running a lean and mean organization. “The ethos and core of how we think about the business is to grow profitably. The reason I bring this up, is that it puts us in a position even if things slow down that we don’t need to cut back on our compensation or hiring plans. To the contrary we use the opportunity to find great people to add to the team, as well as acquire inventory at better values with higher expected margins. Most of our competitors would hire lots of middle managers or employees just to fill seats when times are good, then they realize they have bloated expenses as soon as there is a slowdown in the market. It’s a lot harder to cut expenses once they are there and reconfigure an organization in my view than to build it lean from the start. For us it is prime time to take more market share and invest across our business.”
Last year alone, the company hired two new top-notch salespeople (most of whom worked previously for big-brand names), bringing the total to seven, and another watchmaker — also bringing the total to seven. The company employs three polishers, as well, and is in the process of hiring four more people within the company for other tasks.
Officially founded 14 years ago in 2009 by Tutunikov’s mother Victoria and stepfather Jake Rokhlin, the store had roots a few years earlier. According to Rokhlin, he and his wife started their own jewelry store in 2007 and in 2008 started selling watches online – with 60 watches in inventory. “We quickly realized that watches were the way to go and got out of jewelry. We became Swiss Watch Expo in 2009.”
Today, Swiss Watch Expo is a full-service operation that includes a complete watchmaking service center fully stocked with thousands of replacement parts and all the equipment necessary to refinish/restore a timepiece to ready it for sale. The department, headed by Rokhlin – an engineer turned watchmaker – has state-of-the-art equipment that includes testing machines for water and pressure resistance, timing machines and more. It even has its own polishing department. Its watchmakers are predominantly from bigger brands like Audemars Piguet and Rolex where they worked in service centers.
“We don’t have multiple locations we are not paying for the overhead of those locations and we have one building and ship all over the world from Singapore to Switzerland from here. And that is one reason we are so competitive on pricing. We do it all ourselves. From our computer program, to our sales, our own photography, our watchmaking, polishing and shipping,” says Tutunikov.
As to the watches, Rokhlin does all the buying himself, typically buying 100 to 200 watches at a time to get better pricing. “We won’t take any with aftermarket changes or that are over polished, or excessively worn,” says Rokhlin. “We never take anything where the serial numbers are removed and try not to buy gray market. Our strength is in pre-owned watches with light wear that we can service and turn into a beauty. I don’t want to put a lot of labor into the watch, this is how we can save time and money and we can establish our name for the quality of watches we sell.”
According to Tutunikov, who took over as CEO in 2016, after working as a trader on Wall Street, with business growing, the challenge he has now is keeping up. “We have grown so quickly, 100 percent in six-and-a-half years, that we need more people and we need to bring in more leadership in the organization. We are all stretched thin and maybe beyond our areas of expertise in running the company. There is always better marketing and better branding that we could do. But we are excited about the future of the pre-owned market.”