Considering the price of a luxury watch, you’d think they were an investment.
"If it makes your heart happy, it’s worthwhile. Is it an investment? Not really," says Peter Machlup. Some call him "the Rolex guy", but he is a watch trader by profession.
It’s the same as buying a R5m car, says Machlup. Only if it makes you happy and you can afford it — never mind whether it’s an investment or not. But, of course, the key here is whether you can afford one, or, indeed, more.
It depends on how rich you are, says Machlup. "If you have R100m in the bank, then you can buy a R20m watch. If you’ve got R1m in the bank, you can’t buy the R20m watch. Some guys are happy to drive a Nissan. Other guys can afford a Ferrari. Some fellas want a Rolls-Royce."
Muhammad Ravat, managing director of Bellagio, a jewellery and watch store in Sandton, says there are two kinds of people who buy these watches — serious collectors and "newbies". Clearly, everyone’s a novice at some point. That’s where any journey starts.
Most "newbies" are celebrating a milestone or the tying up of a good deal, says Ravat. "Then they would treat themselves to a watch. To celebrate achievement."
While most newbies buy good luxury watch brands such as Rolex, Tag Heuer, Breitling and Omega, which make 100000 or more watches a year each, it’s when you start to buy the next tier of watch — brands such as Cartier and Hublot — that you start handing over real money.
You get what you pay for — these brands make fewer watches, and they are almost works of art. "They are beautiful things," Machlup says. "They are made with wheels and springs — it’s time mechanics," he says, talking about the luxury watches he recommends to customers: "They are made beautifully."
Only between 100 and 1000 watches of this ilk are made each year. Each piece is polished by hand, assembled by hand and made with precision, he says.
Any watch is a time-keeper, says Ravat. "But when you speak about luxury watches, it becomes more of a buy in terms of status or appreciation of the mechanics of watch making."
Machlup dismisses "smart watches" such as the Apple watch: "A man who wants to wear a great watch is never going to wear an Apple. And a man who wants to wear an Apple doesn’t care about a great watch."
Mike Nugale is a software consultant by profession who collects vintage watches.
He says, however, that he wouldn’t spend R10m on a timepiece. "That’s a different type of ball game," he says. "I’m not a multimillionaire. I buy watches because I love to collect them. I don’t buy a watch because it’s the most blingy watch on the planet."
Nugale thinks that watch collecting isn’t a hobby just for the rich. You can collect plastic watches if that’s your thing, he says. "But that’s not the industry I’m in. I’m in the industry of enjoying and buying vintage watches. You look at the aesthetics; the way it gleams. You look at the movements — it’s just fantastic. You get into it [watch collecting], it’s addictive. It’s a great pastime."