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comment by dublinben
dublinben  ·  76 days ago  ·  link  ·    ·  parent  ·  post: Would you rent a watch?

I currently spend $0 a year on watches, so a rental service isn't going to get me to spend any more than that. It's a cute idea for someone who feels the need to wear one of these, but can't actually afford it.




HGL  ·  76 days ago  ·  link  ·  

I think kleinbl00 is asking if there is a market at the mid tier and I dont think there is much of one. There is some sort of market at the high end for people who want to pretend that they are richer than they actually are but its unclear what happens when you put a lot of wear and tear on stuff that probably is intended to live in a safe/vault for its entire life and be worn maybe 2-3 times a year. Maybe thats why its so expensive to rent them.

kleinbl00  ·  76 days ago  ·  link  ·  

It was the ownership angle that interested me. On the one hand, they're social signaling of the highest order and renting such a thing is a serious faux pas. On the other hand, nobody gets into jewelry of any kind to wear it... They get it to have it. I mean, Patek Phillipe's slogan is "you don't own a Patek, you safeguard it for the next generation."

That is not a rental paradigm.

HGL  ·  76 days ago  ·  link  ·  

I thought about it some more and maybe it could be, especially at the medium end. I dont think the original idea works because you have a lot of inventory/depreciation costs but if you modify it a bit it could.

People who love watches have lots of them laying around doing absolutely nothing, why not set up a service where people can rent out their own watches. You can take a cut off every transaction as a service fee think VRBO of watches.

The fees should be low of the individual transactions but the profit center should be services. For a set fee KB will catalogue your watch, photograph it and check for defect, then send it out to the customer. At the end of the transaction the renter will send you the watch back and you will once again catalogue it and check for damages and offer up repair services as needed (at reasonable but slightly high prices), maybe for an additional fee you could even store it (Amazon warehouse model). You should also offer some additional high profit fluff services like cleaning/polish/band adjustments etc.

Additionally you offer some sort of service where the renter can buy the watch, that might provide some social cover for the "I'm just renting it" problem.

You could could have site credits as well, to reduce your credit card fees, and because expired/lost credits are another great profit center, plus it can provide you additional cash buffer.

Your main costs will be the website and the fraud. I think you could probably contain the fraud since you will be inspecting the watches but the website costs might be unreasonably high.

This also solves the problem thelurkerawakens had as you don't hold the watch in inventory and if it dies you collect additional profit for repairs

kleinbl00  ·  76 days ago  ·  link  ·  

I wouldn't discount maintenance and insurance as expenses. Cleaning/polish/band adjustments would be checks you'd have to go through pretty much every time the watch went out.

HGL  ·  76 days ago  ·  link  ·  

Since the watches aren't your own maintenance and insurance would be profit areas not cost areas. The basic service would have a really low cost maybe even a loss leader but all the add ons are where the money is made.

Want to just rent out the watch to whoever? 5-10% fee to collect the money.

Then the rentee can specify a bunch of additional where you earn most of your money:

Want inspection on send out and on return? $10 & Shipping

Is there damage? If you find damage or defect then you quote them a repair bill, they are likely to accept and use your repair service, maybe even mandated.

Want insurance? Extra Fee + Verification of Renters insurance policy

Want to require cleaning on return? $20

Strap adjustment for renter? $10

So you might earn $3-5 a month on the rental itself but you would earn way more on the extras. Thats really were the money is in this model. Hire some high-school/community college kids to clean the watches and do basic low skill work and do the repairs and expensive stuff yourself.

kleinbl00  ·  75 days ago  ·  link  ·  

It's a little disturbing to me that we're discussing nuts'n'bolts. I guess the idea isn't insane.

I would argue that anybody trusting their watch to your service would want assurances that their watch wouldn't get trashed. That means you're carrying insurance. More than that, if the watch is going out to unknown owners regularly it's going to need some regular maintenance. You're also not going to get high school kids to clean, like, a $1500 watch; you can do more damage in cleaning it than you could leaving it alone if you don't know what you're doing so at a minimum, you're discussing semi-skilled labor.

But yeah. Might be viable.

HGL  ·  75 days ago  ·  link  ·  

    I would argue that anybody trusting their watch to your service would want assurances that their watch wouldn't get trashed
True but there can be different levels of assurance, most people will opt for high or mid tier but the bottom tier should be there so that the service appears cheaper than it really is.

    That means you're carrying insurance
you can cover a lot of the damage through self insurance and repair, if you cant get fraud/damage down to the point where you can cover it you go BK because the model isnt viable anyway.

    More than that, if the watch is going out to unknown owners regularly it's going to need some regular maintenance
It will, but in my model its up to the owner to decide how that happens. Its another hidden cost/fee that you can take care of as a service. The same way CARE.com will do payroll or VRBO has cleaning partnerships.

    . You're also not going to get high school kids to clean, like, a $1500 watch; you can do more damage in cleaning it than you could leaving it alone if you don't know what you're doing so at a minimum, you're discussing semi-skilled labor
simple operations can be done unskilled, if you need to polish the glass that's probably up to you. High school kid is unlikely to do $1500 in damages to a $1500 watch so then you are looking at 200-500 and that's a reasonable risk to take as long as it doesn't happen very often.

Look I'll be honest my model is mostly viable because there is a lot of cost shifting going around. You are renting out other peoples stuff taking transaction fees in the process and then steering your customers to use all your secondary services. Its dot com bullshit 101 except there is a second profit entity (the service center) that feeds off the the website, provides a competitive advantage and acts as a barrier to entry. The service center is the core profit operation, the rental website is just there to drive customers in for high profit services. If you had to bare all the costs of depreciation, capitol maintenance, damage and fraud there wouldn't be much left for profit but if you shift some of these costs out (as the watch owners are already incurring some of these costs) then the model looks a lot better.

cgod  ·  76 days ago  ·  link  ·  

I'd guess that the service would serve as many people that already owned a cool watch or two as much as it would serve the guy who is looking for status. A watch enthusiast might just enjoy sorting a few different watches over the course of a year.