Patek Philippe

aaronm
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Quick explanation

AD: Authorized Dealer.  They are contractually bound to the brand, so there are limits to their price flexibility.   They are also required to (usually) buy a certian number of watches per year, to keep their status. 
Gray Market: a non-authorized dealer.  They usually get their watches from the AD, from each other, or from regular people.  They can range from the "better than AD" in terms of  service and customer satisfaction, to "barely not getting sued".   Frequently the same dealer will have a new and used watches, sometimes even of the same watch.  They also vary in terms of papers, sometimes the watch comes with "box and papers" sometimes not.  Also some will warrenty the watch internally, which is quite nice, as whether the factory will honor opened papers is kinda a crap shoot sometimes(I've never dealt with PP, speaking about brands in general).

So the summary is: the AD is the 'easy' way, if they have the watch that you want.  You'll pay more, but there is less worry.  They may also give some perks, mine has an annual party with free food and all the brand reps to chat with.

the Gray market will almost always be cheaper, but you have to do your homework with regards to dealers.  Many will also buy and sell, so if 1 year from now, you want someting different, they'll take last years watch towards this years purchase.

so it's a gamble: if MSRP-%(off at GM)+%(chance of repair not under warranty)*(cost of warranty)+worry-(reliability of GM) < MSRP by 'enough'
buy at the gray market.  If you worry about such things, then no price is low enough, same for a unreliable dealer.  For me, the price difference is more than the repair and the worry, but that's not everybody.

There's also the issue of location.  For Patek, my local AD is pretty bad, maybe 15-20 pateks in stock, normally nothing more complicated than the 5035/5146, whereas my local GM must have 60 in stock, including a pile of Perpetual Cals and some interesting vintage stuff, including a vintage Rattapante Pocket watch, that I'm going to post some pictures of, as a present to anyone brave enough to read this entire thing

Aaron