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Is Buying a Watch or Jewelry Duty-Free Worth It?

by on July 15, 2011 · 36 comments

in General TPG Business, Shopping

I’m in the market to get a new watch – not something extravagant, but something high quality that I’ll keep forever. It dawned on me the other day while passing through CDG, that maybe I should buy duty-free while I’m abroad. So I went on the internet and asked some friends and I’ve gotten a lot of mixed responses.

So I open this up to my trusty readers: Does it make sense to buy jewelry (specifically nice watches) duty-free while traveling abroad? I know the best bet would be to price shop in NYC and then compare prices, but I haven’t had the time to do that and there aren’t that many online watch retailers that offer detailed pricing information.

Any thoughts or experiences would be greatly appreciated!

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  • Michele Hirsch

    Hi! In many cases, watches depreciate greatly. In my opinion, the best way to purchase a watch is on auction. Check liveauctioneers.com as an example. You can see if you look at the sold examples what great deals you can get. That being said, they are not new (although can be serviced and polished like new afterwards) and you may pick a brand/style not available. But you will get great value. This has become my only way to purchase fine goods. Happy hunting! Michele

  • Rick

    Rolex appreciates

  • Rick

    Rolex appreciates

  • Rick

    Rolex appreciates

  • Aussieflyer770

    IME Duty Free is marked up more then the savings you get…

  • Aussieflyer770

    IME Duty Free is marked up more then the savings you get…

  • Aussieflyer770

    IME Duty Free is marked up more then the savings you get…

  • Steven S

    My best experiences have been purchasing from Palisades Jewelers in Englewood, NJ – a real store, not just a PO Box somewhere. They have a vast selection of new, almost new and vintage watches though their biggest selection is Rolex. They are scrupulously honest, very competitively priced and they will stand behind the merchandise. I have bought 5 watches over the years and have always been happy. Good luck. BTW, you’re showing your age! You can’t GIVE a watch to a young person!

  • Naveed Khalidi

    “Does it make sense to buy jewelry (specifically nice watches) duty-free while traveling abroad?”

    I’d say generally not. Name-brand luxury goods are generally cheaper in the U.S. than in other countries, especially after factoring in VAT (though granted that can be refunded) and exchange rates.

    Find a particular manuf and model you like – e.g. Rolex Milgauss green crystal – and then begin comparing prices. For models under $10k, there’s generally little negotiation room when buying from authorized retailers.

    On the gray-market side however, the item is identical but meant for use in a foreign country, price is negotiable, and can be shipped across state lines to save on sales tax.

  • cody braunschweig
  • Gene

    One word: COSTCO.

  • X x

    Never pay retail. And definitely price shop. E.G., Tourneau in NY.. you can easily get 20% off listed prices or more. I bought a Blancpain and I think was able to get 25% off. A friend got a higher amount (shocking to me) on a Jaeger le Culture (Spelling?). Different Tourneau in NY will also give different prices. My experience was the one near the Time Warner Center gave much better discounts than the flagship (which would feign they give O, which is a lie). You must show you are ready to buy “right there and now”. Remember to only buy from an authorized dealer — you don’t want problems down the road with the warranty (although my experience is sending a watch back to service is always the customers fault). Its like buying a car. There is the MSRP where every dealer says they can’t sell below, but there are dealers out there (and most of them) that will provide a meaningful discount to close a sale that second. That is how it works for watches. Oh yea if you are comparinig to duty free — don’t pay taxes on a watch! Have it shipped out-of-state! So not only are you paying below MSRP, you don’t pay tax as well! IN terms of price negotiation, rolex are rare to get discounts on (perhaps that has changed in the past 3 years, but I don’t know).. they hold their value better and enough folks will pay retail for rolex. Same with Patek I imagine. But given fact that the vast majority of watches lose 25-40% of their value immediately after purchasing, their is clearly room to negotiate on the MSRP on the vast majority of watches. I would never buy a watch unless I was getting minimum 20-25% off and I would target 30% off MSRP as my buy price. And I would NEVER pay taxes on it.

  • RakSiam

    It’s always seemed to me that all duty free stuff is more expensive than you can get it elsewhere. When it comes to watches I suppose there is also the question of what you mean by a “nice watch”. You can get a perfectly nice watch for $60. Or you can spend $100,000 on a watch. And everywhere in between. I used to be into watches much more than I am now. It’s not something that I see a lot of value in…spending a lot of money on a watch. But I suppose some people collect watches like they collect other things. If all you really want is to be able to tell the time with something that looks nice on your wrist there are millions of “nice” options that don’t cost a lot of money.

  • JJ

    The key is the monitor the FX fluctuations … Last March, I bought a rolex datejust 2 from LHR when the GBP was at 1.47. A watch that would have cost $8200 including taxes in the Texas was only $6300 at LHR.

    The added benefit of buying from the airport duty free is that you get 100% of the VAT back as opposed to 2-300 GBP fee they typically charge.

    As one of the others posted – figure out the exact model you want and note the model number so you can call around. As the MSRP for rolex and many top watches is set by the watchmaker in each country, there is often times little variability.

  • Raffles

    Not sure its worthwhile ex-US as sales taxes are low. I bought my wife a £5k ($7.5k) watch at Heathrow last year – she pre-identified what she wanted, I called the jewellers, paid a deposit, they ordered the watch and I picked it up when I was passing through. Saved c 15% on the UK list price (VAT was 17.5% then, now 20%), plus got another 5% back in Heathow shopping vouchers via a promo the WorldPoints scheme was running. For a US buyer, this is less interesting as sales tax is less than the UK’s 20% VAT.

    Whether you can buy the watch for less abroad purely due to FX fluctuations is a different question.

  • Shids

    I would recommend two websites , Gems4me.com amd Luminouswatchshop.com which have a lot of great unusual watches to choose from. And since my boss is an such avid reader of your blog and finds your blog most educational and rewarding he will treat you extremely well on any watch you liked or even barter.

  • Antonio

    Brian

    I got my Montblanc Starwalker (stainless steel + rose gold) last year in Singapore; although I bought it with 7% VAT, they gave me 5% tax back at Changi (the process is seamless!). That was more than US$500 back!, the cost of the watch is the same in US… without the 5% back… so all and all, it is worth it to buy it in Duty Free, wich is BTW the same tax as you may have in US.

    It is a good opportunity for you also to taste South East Asia in a “working” trip to Singapore!

  • RakSiam

    Or you could go to Bangkok when the big department stores have their annual “Watch Show”. Lots of high end and super high end models on display and for sale. I used to be in town quite often for the one at Zen in CentralWorld. Now that the Red Shirts burned it down though I don’t know if there is another outlet for that particular one. I think the Central Chidlom has one too. Usually November-ish. The big jewelers in Bangkok like Gems Gallery are quite flexible on price and typically do not charge tax to foreigners. I have never shopped for watches there though so I don’t know what sort of selection there might be. All you have to do is show your passport and they fill our some paperwork. Of course you have to declare it when you get home so you may or may not have to pay duty. None of my jewelry purchases have ever caused me to pay anything despite my being over the limit.

  • Latimer

    I second Cody’s recommendation: http://www.chronoshark.com/

    Check the site daily and you’ll find something.

  • 88Horlogerie

    Rolexes in general do NOT appreciate. Only certain coveted special editions do (e.g. early edition steel Daytonas). They do however hold their value better than most watch brands. The most important question is what do you want. It is not a bargain if you don’t wear it frequently. For men, there are two primary forms of jewelry that we wear, rings and watches. Therefore, watches are expression of your tastes and not necessarily a functional addition to your wardrobe. If you have small hands, a large diameter watch will look out of place on your wrist. If you have large hands, a Patek Nautilus will look dwarfed on your wrist. Most watches can be bought in the US with a substantial discount. It depends on the retailer, and those that do tend to only do so for their best customers (not necessarily the biggest spenders but customers that buy regularly).
    Also mechanical watches will need to be serviced and occasionally, albeit rarely, break within the warranty period. Most people do not consider the maintenance involved with a mechanical watch though infrequent is not trivial. I personally favor visiting a non-duty free retailer. Watches are frequently shipped out-of-state to save on sales tax. Know that as X x has posted that cost is typically 50-60% of price. Your target discount should be 30-35% of the price. X x is correct that Rolexes are rarely discounted beyond 20%. If you are going to buy a Rolex you should get a limited edition i.e. coveted by collectors. As for what is considered desirable, you should check the forums. In any case, there should be no reason to buy from an unauthorized retailer. I can recommend shops within the US (Michigan, LA) and in Asia (Singapore). Getting service from a duty free shop is a hopeless venture. I will reiterate. Get what you like to wear.

  • Anonymous

    Great advice- thanks. What do you think about Panerai?

  • Anonymous

    Wow, lots of watch experts here. What are your thoughts on Panerai?

  • Anonymous

    LOL… I’d like to think of it as maturity vs age.. I’m only 28! But I totally get what you are saying- I used to not care at all about watches but now my “Whatever, I have a cell phone to tell time” attitude is changing :-)

  • 88Horlogerie

    It looks very nice. Historically, the movement has not been the most reliable thought that might have changed recently.

  • 88Horlogerie

    paneristi.com
    NB I’m partial to IWC. The Panerai GMT reserve models look great but are pricey.

  • TopK

    I suggest you check the Watchuseek forums, they are very informative.

  • Jw

    Hong Kong is The place to buy a luxury watch — forget Europe and the US (although the Costco in Harlem does carry Panerai!). Price wise and selection wise you get the most value and variety. Panerais are amazing and hold their value enormously well. Be mindful that servicing does cost $500-900 every 5 years. Tokyo too is a fantastic place to buy a luxury watch; secondhand recycle shops sell mind-blowing selections for less yet quality is pristine.

  • Zshiner

    Absolutely …. I recently purchased a TAG watch in Singapore. Was approximately30% cheaper than purchasing it in the USA. A couple of pointers. Pay with a Credit Card that does not have a foreign transaction fee. Purchase it in the airport on your way out of the country to eliminate any VAT taxes. The watch came with a full factory warranty.

  • Max

    Go to Geneva/Zurich to buy Rolex and remember to pay in cash to save on taxes.

  • Ben Senise

    Wearing a good watch has nothing to do with telling time. For that you get a Timex. Just like driving a BMW or Porsche is not about getting from point A to point B.

  • Anonymous

    Brian – what watch did you end up buying?

  • Anonymous

    Brian – what watch did you end up buying?

  • Anonymous

    Brian – what watch did you end up buying?

  • Redwine

    I just came back from Canada with a watch that I really liked. It’s an Orient automatic. I paid about $265 USD for it. As I tried to find the watch model number online, I couldn’t so I matched it to a picture from an online retailer. Their price was $170! I contacted Orient Watch USA and found it although the model numbers are different, the watches are identical. Hence, if you buy duty free, you better know what watch you want and the prices in the USA or risk getting ripped off like I did due to impulse buying.

  • santamaria

    i would like to see list of watches

  • treacle

    Depends where, I just purchased a Longines classic watch for approx GBP 900 at Bangkok Duty Free, when I got to Doha Duty free it was about Gbp 550, now i’m looking online it’s possible about the 600/700 USD in some places in the states. I’ve had to suck it up but also there was better choice at Doha so it really does depend on which country I would say. Be careful and don’t make rash purchases during/after lengthy journeys without shopping around on the net first …. as I did. :(

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