Razny Jewelers is the only authorised dealer for Patek Philippe in a territory centred on Chicago that stretches across almost all of Illinois, Indiana, Iowa, and Wisconsin. That is 220,000 square miles. For reference, the United Kingdom is 94,000 square miles.
Quite a responsibility, and an opportunity for a family-owned jeweller with four showrooms in downtown Chicago and its most affluent suburbs.
Along with Patek Philippe, the business is an authorised dealer for Rolex, Cartier, Breitling, Tudor, TAG Heuer and Tissot; a carefully selected line-up that gives customers entry points into the world of luxury Swiss timepieces and a journey to its highest peaks.
At a time when brands are becoming far more selective about the retailers they work with, and increasingly looking to sell direct to consumers in many cases, the company’s owner Stan Razny welcomes the challenge of proving that family-owned jewellers with the level of personal service that Razny provides will continue to thrive.
WatchPro’s Rob Corder sat down with Mr Razny to get his views on the ever-changing landscape of the luxury watch market, and how family-owned independents provide value that direct to consumer brands will struggle to match.
WATCHPRO: It feels like we are living through a period when the Swiss and global luxury watch industry is changing more quickly than at any time in the past 50 years. Is that your experience, and how are you adapting?
STAN RAZNY: You talk about change, but the Swiss watch industry is like an aircraft carrier in many ways. It likes to go straight. If you stay in a straight line, you quickly get much further than you would if you keep changing course. That is the right thing to do.
World-class brands like Rolex remain focused on the customer’s journey. We’ve learned how important it is to begin knowing about our clients from the moment they walk into our door.
This attention is crucial to our goal of giving customers an unbelievable experience, whether they’re shopping our Rolex collection, Patek Philippe, or any of the other Swiss watch brands we carry. A culture of hospitality shines in our jewelry and custom design presentations too.
We are selling luxury, and our customers deserve the exceptional.
As an owner, I make sure someone from my family always works at each of our stores, paying close attention and sharing their experiences with us all. That is enlightening. We are constantly learning from each other about how we can be better.
WATCHPRO: Do you feel that if you get these fundamentals right, the business will take care of itself, regardless of what happens to the market and the economy?
STAN RAZNY: We never take business or our clients for granted. As we head into the next two years, none of us knows what will happen to the economy, but businesses like ours that care about their customers and the customer experience will come out on top.
We are putting a lot of attention into staff training, and I pay incredibly close attention personally to our systems and practices. Within 18 months, I’ve traveled over 90,000 miles between our stores to ensure everything is perfect.
I am not selling at my stores, but I am supporting my team. I am always around, nurturing communication. Any questions for customers or staff are answered quickly. We can react and pivot quickly to any change.
The most important thing is to reinforce within the family and the Razny team that we are all in this together. Our united mission is to bring an incredible level of service to our clients.
WATCHPRO: Globally, and particularly in the United States, over the past two years, we have seen the strongest market in a generation for luxury watches. That seems to have triggered among the group brands of Richemont and Swatch Group a strategy to sell directly to consumers more so that they retain a greater percentage of the profit from each sale. But what I think they are going to find is that, when times get a bit tougher, they are not going to be as good at retail as family businesses like Razny Jewelers. It is easy when watches are pretty much selling themselves. Still, we will see who has the ability to delight customers and keep them coming back when discretionary spending comes under pressure.
STAN RAZNY: There is going to be a point when the market turns. It is easy to sell two or three models that are in high-demand when available. Sustaining excitement for weeks or months, however, is more complicated.
In a corporate store, there is a tendency to see work as 9-to-5. For our family and team, we are working 24-7, constantly engaging with our customers. This level of care makes a massive difference. Our customers are hard-working and successful, but they are usually time-poor. They may have no recourse but to reach out to us at some of the craziest times of the day.
Thierry Stern stood in front of a group of us Patek retailers and told us to ‘take a chance.’ They want us to allocate 25% of our received timepieces to new customers yearly.
Sometimes I will get a text at 3 a.m. from a customer in another part of the world. Corporate stores are not going to be as approachable, flexible, and available for customers. Luxury brands appreciate being represented by someone with this level of dedication. They understand that to delight customers today, this commitment is needed.
We, as luxury retailers, understand it is very difficult to manufacture a high-end timepiece. On the other hand, brands must understand that great skill is required to get a watch on a customer’s wrist and ensure they are so pleased with the process that they want to do it again.
Rolex and Patek Philippe respect the retailer’s craft, which is why they go to great lengths to support their partners, like Razny Jewelers.
Thierry Stern [President of Patek Philippe] has been into every Patek Philippe store and sent representatives to purchase a timepiece. Rolex is doing the same thing with secret shoppers. They are sending experts into stores to shop and evaluate the experiences. They see how valuable that final piece of the process is, from the timepiece’s construction to the customer’s wrist.
We are aligning ourselves with Rolex and Patek Philippe because of their elevated criteria, and we know that if we continue reaching and exceeding their standards, ours will be a lasting relationship. I always tell my team we must do a little bit better every day.
Rolex and Patek Philippe see it the same way, which is why they have such extensive training programs and resources. My team members can quickly improve by utilizing the apps and modules the brands provide – it’s really convenient.
Corporate stores sometimes benefit from preferred watch allocations, but a family business outperforms them every day of the week because we never shut off. We are constantly engaged with our stores, teams, and customers. I am continually listening, answering questions, and learning from them.
WATCHPRO: You mentioned the dynamic of selling when there are waiting lists for the hottest watches and brands, but how do you keep the market growing by bringing in new customers?
STAN RAZNY: This is something my team discusses all the time. It was interesting at Watches and Wonders; Thierry Stern stood in front of a group of us Patek retailers and told us to ‘take a chance.’
They want us to allocate 25% of our received timepieces to new customers yearly.
WATCHPRO: Is that a new directive you received at Watches and Wonders this year?
STAN RAZNY: It has been coming for a while. Over the past three years, Thierry and the New York team under Lisa Jones have urged us to be bold and take chances with new customers.
We would love to allow everybody to get their hands on a new Aquanaut or Nautilus, but the problem is we don’t get a lot of them. We get treated well because we have two Patek Philippe doors, but these models are limited. At Razny Jewelers, we emphasize the entire experience, a journey through the brand. Simply allocating “hot” pieces is shortsighted, in our view. We are developing collectors of the future who share our passion for our brands.
Even with that in mind, when we receive single-digit quantities of certain timepieces, we are encouraged to sell 25% of them to new customers.
WATCHPRO: This aligns with Patek Philippe’s decision to reduce its number of authorized dealer doors by 30% worldwide. They need to give better allocations to fewer stores.
STAN RAZNY: Mr. Stern does not just want to partner with retailers to make money for them. It is about working with retailers that invest in the brand. He wants to know we are willing and able to keep improving for many years.
An authorized retailer’s next generation of owners has become an everyday topic of conversation. Brands want to know about a succession plan. They see I am 63 years old and want to know the Razny family’s plan for the future. With my three children working as third-generation owners, and exciting projects for even more significant expansion, it’s clear Razny Jewelers is invested in tomorrow.
As the only authorized Patek Philippe retailer in the market, we don’t have to fight for our territory. It is a beautiful relationship. We are now the only partner in Illinois, Indiana, Iowa, and Wisconsin. That is a large area to cover.
If a client comes to us from New York or California, I encourage them to build a relationship with a store in their hometown, with Wempe in New York or Polacheck’s in California. That way, everybody gets the best possible experience.
WATCHPRO: It feels like Patek Philippe has created a genuine family of partners who support each other.
STAN RAZNY: We are all blessed to be part of something so close-knit. The community of Rolex partners is intimate as well. There are only a few hundred doors in the United States and even fewer accounts.
WATCHPRO: Ultimately, Patek Philippe and Rolex want you to be the very best custodians of their brand, which means delivering the highest level of service to clients. Retailers that fall short will lose out to those that excel.
STAN RAZNY: In our experience, Rolex wants us to go to them with ideas on how to elevate the client’s experience. If they have to go to a retailer, it is already too late.
We work with the very best when remodeling. Obrist in Switzerland is our go-to contractor because we know they will never let us down, and we will not have problems down the line with any of their work.
That is important when you are investing in a high-traffic showroom. You cannot cut corners, or you will not get the perfect result that we, our customers, and the brands require.
Years ago, we committed ourselves to offering only ethically mined natural diamonds. I am not going to sell lab-grown diamonds
WATCHPRO: We have spoken a lot about Rolex and Patek Philippe and the standards they expect, but how does that affect the rest of the business? After all, it is the Razny name above the door, and a good percentage of your space and energy goes into jewelry and other watch brands.
STAN RAZNY: We are first and foremost jewelers. However, Razny Jeweler’s image must be in sync with the brands’ image. But when we put the customer first, everything else falls into place.
We represent some of the highest regarded brands in the business and only offer fine, quality jewelry. Years ago, we committed ourselves to offering only ethically mined natural diamonds. I am not going to sell lab-grown diamonds; I am not going to sell anything of inferior quality that will only cause the customer a headache in the future. At the same time, we offer lasting designer and custom jewelry at all price points.
I tell my staff that our service counter is the most crucial point of contact with our customers. It is often the first place we encounter a new customer. It is like a test for us. If we handle a repair well, for example, it gives them confidence in us as a jeweler.
We have endless stories of incredibly wealthy people coming into our store and asking for a Rolex bracelet to be adjusted to sit perfectly on their wrists. We always offer this service free of charge. It allows us to get to know them.
A few weeks later, we discover they have come in and bought a piece of heirloom-quality jewelry. Time-poor people appreciate excellent service the most. Right now, we are hiring more people in our back office service roles than any other part of the business: watchmakers and jewelers are crucial to taking care of people, and the better you do it, the more clients will keep coming back.
Taking care of our own people is just as important.
WATCHPRO: How do you feel about the march towards mono-brand stores over the past few years? You clearly invest heavily in the branded shop in shops but not yet in boutiques, which is the direction of travel, even for brands like Patek Philippe and Rolex, and particularly for the likes of Breitling, TAG Heuer, Omega, and Tudor, which you carry.
STAN RAZNY: I have never wanted 20 brands under one roof. We want to focus on the best, like Rolex, Patek Philippe, and Cartier. Then we have Breitling, Tudor, and TAG Heuer as well. There is a minimal crossover between those brands from a pricing perspective, and there are other differences. Cartier, for example, is a very feminine brand but offers iconic timepieces for men also. Breitling has a very different look to Rolex or Patek Philippe. Our strategy is to avoid having brands fighting over the same customer.
There are some examples where there is more competition. In our Addison store, we have Breitling, Tudor, and TAG Heuer, which can be at odds, but we give them separate areas to sell the lifestyle associated with each brand.
If you don’t offer an alternative, you might lose that customer forever, which is the beauty of providing Tudor, because it is an attractive price, more available, and an ideal first watch for somebody just coming out of college or getting a new job. TAG Heuer and Breitling are also fantastic watches. We don’t want to give the impression to people that Razny Jewelers is too expensive or unapproachable.
WATCHPRO: Three of your four showrooms are in suburban or satellite towns of Chicago, with the fourth downtown on the prestigious Oak Street. The economics of each store in terms of price per square foot, demographics, and footfall must be very different. Oak Street must be particularly expensive, and you are competing with corporate branded boutiques where the marketing value of the storefront is factored into the profitability so the brands can see them as a success, even if they are not covering their costs through direct sales.
STAN RAZNY: The brands have become more thoughtful about that, and they help us by allocating to us more products for an expensive location like Oak Street. Businesses are moving out of Michigan Avenue and onto Oak Street.
Soon our street will host Cartier, Buccellati, Graff, Richard Mille, Patek Philippe, Panerai, IWC, and Jaeger-LeCoultre, all the watch brands run by family-owned retailers. Oak Street is becoming the destination for luxury timepieces; it will be great.
WATCHPRO: The watch market seemed to be transformed, perhaps for all time, but the pandemic was because people could not spend money on expensive holidays and dinners out, so they sat at home and treated themselves to hard luxury items like watches. And not just one watch but several watches from a broader range of brands than ever before as they became better educated. Has that been your experience?
STAN RAZNY: If you talk to owners of family businesses, they have had record years. Contractors, for example, have so many projects in the pipeline. And what entrepreneurs love to do is reward themselves and their families—what better way to do that than with a timepiece?
WATCHPRO: There was a lot of talk at Watches and Wonders about the market cooling this year, and I have spoken to several retailers, even those with Rolex, who say they have been calling up customers who have been on a waiting list for some time to say they have their watch, but the customer no longer wants it because they are tightening their belt. As we sit here in May, are you seeing that at all?
STAN RAZNY: We are experiencing that but are also prepared for it. Over the past few years, we have done a tremendous job of clienteling and collecting customer data. We know their wish lists and are constantly communicating with them, not just waiting for a transaction.
Of course, there are times when customers pass on a watch, but if you have done a great job keeping in touch with them, they will return. And a refusal of a timepiece allows us to put a watch in a case that a new customer can buy. It has been three years since we were able to do that.
So, there is a reset, but it is a slowdown from warp speed. I actually prefer where we are right now. I did not enjoy the time when we spent all our time negotiating over who would get a watch and trying to make sure they were going to customers who would genuinely love it, not buy it as an investment.
WATCHPRO: We cannot ignore the impact of more people buying luxury watches, not necessarily as investments, but safe in the knowledge that they will retain or increase their value. As demand slows, availability rises, and secondary market prices fall, additional demand could evaporate.
STAN RAZNY: Yes, but we are so much better at managing this. There is much greater transparency today about what allocations we will get from our brands. It used to be that when a package arrived from Rolex, it was like a delivery from Santa Claus.
We never knew what we were going to get. Now, there is a system so that we know exactly what we will get and when, and we can manage the allocations with our customers. We will not over-promise on timepieces that we know will not arrive. It also helps us plan how to sell timepieces where we do not have customers waiting.
The portal has been in place for two to three years, and it took us some time to work out how to use it. Now, we really delve into it, and it has become a hugely valuable tool to help us manage customer expectations and plan for selling.
This system helps with inventory management, so I do not think we will ever return to the situation where we have 1,000 timepieces in our inventories.
Communication with Rolex and Patek Philippe goes both ways. So, if they see that our inventory is rising for certain timepieces in one of our stores, they will throttle back on supplying that product.
That is one of the great benefits of working with these brands. We sold two Patek Philippe timepieces last night, and Thierry Stern knew about it by noon today. Rolex is the same way. They know as soon as we swipe the warranty card on a sale. They know what is selling.
Five years ago, Rolex would only discover what was selling if one of their reps entered our stores. He would compile a report, send it to New York, and then aggregate it into another report for Geneva. It was patchy, unreliable, and slow.
Now, we are all expected to be completely transparent with our data, so Rolex knows precisely what is selling and what is not and can adjust supply.
During covid, Rolex helped us get many of the most desirable professional timepieces into the market. We could sell that product immediately.
This year we are seeing the power of the Rolex portal because they are constantly improving and adjusting the supply of the timepieces that are selling best.
Everybody likes to say that Rolex is holding back timepieces. That could not be further from the truth.
WATCHPRO: It is good to hear that these partnerships are working so effectively right now. But brands like Rolex and Patek Philippe do not want only to make the watches that are hot today. They both want a balanced portfolio with men’s and ladies, steel and precious metals, etc.
STAN RAZNY: Correct. Rolex produces significantly more than Patek Philippe, but the mindset is the same. Patek Philippe has said that it will not just produce Nautilus and Aquanaut timepieces. Additionally, Rolex is not just going to make professional models.
Interestingly, demand for 28mm and 31mm timepieces is surging right now. People are asking about these timepieces as much as they are for a steel Sub.
During COVID, they throttled back on these ladies’ sizes, and it has taken a couple of years for production to come back into the system.
Rolex is doing an incredible job matching supply to demand, but there is only so much they can do. We have seen a slight decline in order, but I do not see it dropping, and Rolex will always have more demand than supply.
WATCHPRO: And Patek Philippe is intentionally making more valuable watches so that, even if it makes the same number of watches each year, they are selling for far more.
STAN RAZNY: That is a genius move. Thierry does not want to make as many steel timepieces. He decided to stop making the 5711 in steel and introduced it instead in white gold. That is smart.
It is much better value in white gold than in steel. Same with the 5968 [Aquanaut]. Steel was great, but now it is even better in white gold and rose gold. We will see more complicated pieces from Patek Philippe and more precious metals. That is how the brand is evolving, and it is exactly what clients want.
WATCHPRO: Where do you stand on the certified pre-owned programs? Rolex is going all-in, and Patek Philippe is saying it does not want to go there.
STAN RAZNY: We are excited. It is a huge commitment to be part of it from a retailer’s perspective, and we will invest in devoting one or two full-time watchmakers to it. There are some limitations. We will not be able to buy and sell Rolex timepieces as freely as we once did because they have to be at least three years old.
But, ultimately, a Rolex timepiece that is five years old is still a baby. A 30-year-old Rolex can still be refurbished to mint condition. So, we see it as an opportunity to bring a lot of timepieces into our inventories where, before, we had to take a back seat to the specialist traders.
The resources of Rolex will be behind CPO. The network of resources we have been building for years will be behind it. We already have some of the best watchmakers who have been trained for years and will be part of this.
We have been asking for a while why all these timepieces are being traded around us. Why not bring a percentage of them in?
The consumer is going to appreciate the backing of Rolex. Right now, there is a huge fear of dealing with businesses that they do not know. That disappears when you buy a timepiece from an AD that is part of the official Rolex CPO program.
It is not going to happen overnight. All of us ADs will have to learn how to crawl before we can walk and then run. Much of the responsibility falls to us because Rolex wants us to service the timepieces before we send them in to be certified and issued with the guarantee.
WATCHPRO: Do you expect to be able to certify the watches, or will they have to go to Rolex?
STAN RAZNY: Initially, they will all go to Rolex to be certified and photographed. That is exciting because everything is going to look uniform. I see positives. There will be some kinks along the way, but they will be ironed out quickly.
One question is whether online dealers will want to buy these certified timepieces from Rolex ADs with the tags. It will be interesting to see. I do not know.
WATCHPRO: I hear that these traders expect to have a price advantage because they run off lower margins, have lower overheads, and do not always need to do the servicing and authentication that the Rolex CPO program requires.
STAN RAZNY: We will see. Things are going to be different in two years than they are today. But consumers are going to benefit.
WATCHPRO: It does look to me like a massive opportunity for authorized dealers because when a customer comes in looking to trade in a pre-owned watch, you have the potential for two profitable transactions: one to resell the watch the customer is selling you and another to sell a new watch to that customer.
STAN RAZNY: Correct. I want that consumer in my store. Why would I want them to go to another store or the Internet to sell their watch? All ADs like us have built our business on a lot of pillars. Service is a very expensive pillar and not a profit center, but it hugely supports the sale of timepieces. Once we start doing CPO, that service pillar becomes even more valuable to the business.
WATCHPRO: I have spoken to some substantial and experienced pre-owned traders, and they fear they will be out of the Rolex game in five years as the official CPO program gets up to full speed. They will not be able to compete.
STAN RAZNY: How the second-hand market looks today and how it will look in 10 years’ time will be dramatically different. If not a majority, then a significant amount of that Rolex business will be going through the ADs.
WATCHPRO: How do you expect to handle a situation where you might have two identical Submariners, one three years’ old, the other brand new, selling side-by-side, but the second-hand watch is twice the price of the new one?
STAN RAZNY: We will simply be honest with customers. Sometimes these situations defy logic, but we can explain how we get there. Hopefully, sanity will return to the market over time.
WATCHPRO: I find it interesting that Rolex and Patek Philippe have seen similar dynamics between the new and used watches in the market, but they have reached different answers on where to go. Patek Philippe thinks the way primary and secondary markets operate is fine. Rolex sees an opportunity to make it better.
STAN RAZNY: I wouldn’t speculate, but at the moment, Thierry wants to focus on making the very best timepieces and providing the best possible service to customers.
WATCHPRO: How much do you change your line-up of brands over time. Independent watchmakers are hot right now, is that a market you would like to get into?
STAN RAZNY: We are delighted with our line-up of brands right now. They are of the highest standard, and we’re fully committed to their future success. I do not want to dilute that.
We want to keep investing back into our current brands rather than divert that investment into something that might be hot today and cold tomorrow. In this way, we are staying very focused on only getting better.