So, how does Rolex really spend its profits?

[Matt]

All the profits come to the trust. Later in the document (I knew I should have translated the lot!) it becomes clear that the trust is largely independent of Rolex and disburses money, including back to the various arms of the company as they see fit. So I don't know the percentage, because it will vary, but you'll note that A and B make it clear that the trust gets all the money and then ploughs it back into the company when they need it. I have always assumed that the massive advertising budget comes from here. It's certainly in the spirit of Hans Wilsdorf, as he had an eye and flair for advertising and giving away watches in a way that was both decent (POWs) and dramatically effective (golfers and astronauts for example) He has always supported endeavour that catches the imagination and showcases Rolex's products - Mercedes Glanz swimming the channel, for example, or the nearly successful 1952 Lambert expedition to Everest. So it's no surprise that Rolex continues to take that approach to this day. When this document was written, Rolex were still a comparatively small player in a fiercely competitive market. They'd made the jump from merely recasing Aegler movements in the twenties and had got a leg up by buying the Harwood patents for waterproof automatic watches and reverse engineering a variation of the Dennison waterproof crown, but they didn't make their millionth watch until the mid fifties. Personally I think that it was the foundation that ensured that Rolex weathered the 1970's recessions and arrival of quartz better than pretty well any other manufacture and allowed the company to maintain their veblen good status as mechanical watches went from being essential if you wanted to have your own personal time, to a slightly archaic affectation. It was Rolex that blazed the trail of automatic watches as an aspirational luxury good that Swatch group and others have followed once they worked out how to at least draw at the low end.

[Matt]

The Swiss watch industry is pretty damn incestuous. Rolex and earlier versions of Omega worked together on early quartz for example. However there is no charitable connection that I am aware of. However, I think that Rolex lead the way in charitable works for reasons which should be obvious. There are few people who would be willing to give all of their money away and we should be thankful that Wilsdorf died without an heir as it is this single fact that (IMHO) saved what of the Swiss watch industry was saved by surviving well enough to show the way to a rebirth. Rolex demonstrated that the mid high end mass market could be profitable even without the need to know the time. Without them you'd probably still have companies like Patek and JLC providing geegaws to the gentry and then nothing much mechanical until you get to the disposable stuff that Seiko demonstrated can be worth while. Then you'd have quartz. Charity is always good copy, but Omega's efforts are a drop in the ocean. And don't get me wrong, they are my personal favourite watch brand.

[Matt]

Another insight into Hans Wilsdorf is Rolex's (not the foundation's) care of the Church Clock at the English Church that Wilsdorf (who was a British citizen and spoke good English) and his wife (who was English) went to Church.

http://www.watch-around.com/en/subsc...-wilsdorf.html

It's the exchange at the end I like:

“It is in keeping with Hans Wilsdorf’s personal wishes that the English church clock is maintained by Rolex.”
“For how long?”
“For ever, I suppose.”

Here was a man who thought big and understood deep time - I want you to look after that clock... forever!

So cool.

[Chronopolitano]

Another insight into Hans Wilsdorf is Rolex's (not the foundation's) care of the Church Clock at the English Church that Wilsdorf (who was a British citizen and spoke good English) and his wife (who was English, therefore spoke atrocious English, saying things such as 'Saturday week' to mean 'Saturday after next') went to Church.

FTFY

[ilitig8]

All the profits come to the trust. Later in the document (I knew I should have translated the lot!) it becomes clear that the trust is largely independent of Rolex and disburses money, including back to the various arms of the company as they see fit. So I don't know the percentage, because it will vary, but you'll note that A and B make it clear that the trust gets all the money and then ploughs it back into the company when they need it. I have always assumed that the massive advertising budget comes from here. .

I assume this was directed at my post. I may not have made it clear but I knew you could not answer the question, only some people within Rolex and/or the trustees could answer what percentage of total sales end up in what would be classified as charitable giving. As for the advertising budget, it would have to come from the trust as you have outlined the movement of the money.

Again, Rolex numbers spark interest in the watch community mainly because they are so secretive, which makes perfect sense for a closely held private company.

[Matt]

You are quite right, it was and your observation is also quite correct. As for the advertising budget, it still isn't clear if that would be considered part of the operating cost of Rolex and thus met by one of the arms of rolex or not and thus met by the foundation. As it goes, I suspect that the latter is the case, but the former is not excluded. The reason I think that it is the former is simply that this would allow Rolex to give very little to the trust and thus reduce its role. This is very clearly not what Wilsdorf intended

[GaryF]

It's great that this stuff is here and available. Thanks, Matt.
One of my first thoughts was "Why doesn't Rolex make more of this?" before being followed by the thought: "Isn't it refreshing that they don't".

[Matt]

FTFY

If that was the extent of his atrocious English, I'd still call that good English. There's nothing worse than English Idiom for even the most adroit of non English speakers. However, I'm not an expert on this. I'd been given to understand he had a good command of English as he initially worked as a translator in England, but I'm not overly committed to the claim.

[Matt]

It's great that this stuff is here and available. Thanks, Matt.
One of my first thoughts was "Why doesn't Rolex make more of this?" before being followed by the thought: "Isn't it refreshing that they don't".

It's really odd. In some ways Rolex advertising is absolutely outrageous, and yet when it comes to the company themselves, they are really quite private. I'm still astounded that with all the Rolex fanatics out there, this has never been translated before. Except, of course, by Mr Deaton in six months time.

[ilitig8]

The Swiss watch industry is pretty damn incestuous. Rolex and earlier versions of Omega worked together on early quartz for example. However there is no charitable connection that I am aware of. ... Charity is always good copy, but Omega's efforts are a drop in the ocean. And don't get me wrong, they are my personal favourite watch brand.

What I was asking is if anyone knew why two Swiss watch manufacturers (and two pitted directly at each other) both support eyesight charities. It just seemed odd, while we know Wilsdorf picked eyesight I am left wondering if there is a connection to the geographic area or possibly watchmaking. Could it be that given the loss of eyesight meant loss of a job in the watchmaking industry was the genesis? I don't know it is just a curious thing to me.

Were you saying Omega's efforts are a drop in the ocean compared to charity as a whole, which one would almost have to agree with, or compared to Rolex, that one is left with no answer, only conjecture. Rolex may give 2 times as much, 10,000 times as much there is just no way to know.

Don't let anything I have said take away from what is my admiration of what Wilsdorf did. For me, like many interested in the Swiss watch industry, I find the inner workings of Rolex to be intriguing, mainly because we don't know much if anything concrete about it, even the number of watches they produce is speculation. Over the years I have read most everything written in English I could find on the Foundation's role vis a vis Rolex SA and alas the pickings are slim. I suppose part of that stems from writing a plan for institutions of higher learning in the US to guide them in explaining the benefits to potential deep pocket donors of bequeathing portions of their estate to the schools after some significant tax changes in the early 90s.