Why Are Watches So Expensive?

Why Are Watches So Expensive?

Why Are Watches So Expensive?   feature articles

I get asked this question a lot so I figured I would simply layout a number of the reasons why watches are expensive in an article. There is a threshold issues though - and that is between "expensive" and "overpriced." Those two items are not mutually exclusive, and are different.

Expensive just means that something costs a lot, but there is good reason for the price. Overpriced means that something simply has a cost that is vastly in excess of the materials cost + marketing costs + development costs + manufacturing cost + distribution costs + fair profit. Expensive watches and overpriced watches are very common. And unfortunately overpriced ones are too common. At the same time, you need to ask yourself, "if a brand asks a certain overpriced amount for a watch, but is still able to sell them, can you still regard the watch as being overpriced?" The answer is yes, but you still want the watch, don't you?

I will now go ahead and list many (but not all) of the reasons that watches are so expensive. These are both in defense of the industry, and expositive issues that are less glamorous in regard to the luxury industry.

1. Watches can be expensive to make and develop.

It is amusing how often I hear about watch movements that took years to get working. Amusing in the sense that a team would spend so much time on a "problem" that already has been solved, but they want to do so in a "different way." Meaning that they must design a new watch movement to tell the time, but make it just different enough to "call their own." In today's world highly trained micro mechanical engineers plot out models for new watch movements and modules on computers before they are ever made. This process can take years. Especially if the desire exists for something unique or complications that are difficult to make.

Watch movements are not only expensive to dream up, but it is also expensive to get movements to work and be durable. This requires even more testing. Millions can go into the development of a new "calibre." And that is just the movement. Designing a watch case and bracelet might be easier because it is not a machine, but it is tough - especially when you are working with tolerances that are often non existent. Nice watches use good materials, bottom line. The best materials require enormous amounts of hand attention or labor. While machines are often employed to make tiny parts, high-end watches employ teams of people to go over each part and delicately finish them and often decorate them.

A good timepiece can take between a few days to many months to produce. Even brands with high demand often cannot get enough product to market. This problem creates increased market demand and a bottleneck of production. Many brands would like to make more watches than they do, but this isn't always easy or cost effective. Having high demand is a problem people want to have, and is due to the time and complexity involved in making high-end timepieces. This is related to the concept that watches are expensive due to low production and expensive suppliers, which I discuss more below.

2. Movements aren't always cheap.

Some high-end brands make their own movements. Many mainstream brands also make their movements. But this is comparing very high-end mechanical ones with much less expensive quartz movements. Making your own movements universally means that movement costs are gonna be comparatively cheaper - but mechanical movements are still expensive to make.

Most brands need to buy watch movements for their watches (but they can also modify or decorate them after buying them). But a few bucks for a quartz movement can't compare to the cost of a mechanical tourbillon movement. Mechanical movements come in dozens and dozens of styles, grades, and levels complication. Still, a basic Swiss automatic mechanical chronograph movement can cost about $250. This is compared to $10- $20 (price varies of course) for a Japanese quartz chronograph movement. Imagine how much money more exotic mechanical movements cost?

Good movement makers can be awfully choosy. ETA has such a high demand that need to approve your project before selling movements to you. ETA makes a number of quartz and mechanical movements, and are the most sought after in Switzerland from a volume perspective. ETA will further restrict the movements they sell to brands outside of its parent group to fully made movement. This takes the cost per a movement into a totally different echelon.

When you are talking about very high-end exotic mechanical movements, the price per a movement can be in the tens of thousands of dollars. The now defunct but famed BNB Concept movement maker went out of business because brands couldn't afford to pay the bills after buying such expensive components for their timepieces. BNB Concept wasn't overpriced, but cost of most of their complex movements simply cost that much. For this reason high-end watches with complex movements are made more often than not in very limited quantities -because it is too expensive for brands to have these watches sitting around unsold due their cost of production.

Why Are Watches So Expensive?   feature articles

3. Low quantities equal high costs.

When Casio makes most timepieces they don't just make 100 of them. Or 1000, or 10,000. Many Casio watches are destined to be produced (potentially) in the millions. Because of this, the initial cost of development and tooling (to set up machines to properly make the parts for the watches) can be thinly distributed in each piece. Even if it cost a few million dollars to create a new watch, only pennies of that expense will show up in the cost of each timepiece. But what about a watch that only ever has 1000 pieces made, or less? The same basic principles of industrialization apply. Sure many brands purchase movements, but they still need to invest in parts. They also tend to use a series of suppliers. These are people who make parts for them, and also charge tooling costs. Just the cost of making watch hands can be very high. Even if you are talking the comparatively inexpensive costs associated with Asian watch manufacturing, the lower the amount of watch, the higher the cost for each one must be due to the costs of designing, making, and buying the parts that make up the watch. The more interesting the watch, the more likely it is to have custom and hard to make components that cost even more.

4. Most watch brands want to be luxury brands.

The dream to be on a starlet's wrist and envied by passers-by. This is a place many watch and jewelry companies want to be. Few of them get there legitimately, and those that can afford to pay to be there aren't exactly numerous either. Brands that the well-to-do choose for themselves are those that have a history of being preferred by the elite, and have names synonymous with lavish lifestyles and hopefully, quality. It is actually quality and exclusivity that made historic luxury brands what they are today. The idea that people with means have the ability to choose the best and more beautiful. So whatever they choose must be good.

Patek Phillipe has a lot of its reputation today because they have a long history of making excellent watches. Not necessarily because they paid a lot of marketing to make you think celebrities prefer them. It used to be that luxury was about "the best quality and materials - no matter the price." Fortunately this still exists in enough places, but is less common than you think.

So how does a brand attempt to jump start their image as a "luxury brand?" Being the best and using the best stuff is hard. Sometimes it isn't even possible. It requires generations of experience, lots of money, access to resources, and lots of time in R&D. Think of how complex it would even be, to be the best "shoelace maker" around - and what a brand would have to do to attain this position. Now think of any other much more complex product.

The shortcut is marketing and image. Create a lifestyle persona, tell people you are luxurious and exclusive, and bank on the fact that the consumer won't know any better. Seriously, start looking at watch brands that have a slogan that sounds like (or are) "Luxury Swiss Timepieces." They are basically telling you what they want you to think - whether it is true is purely subjective opinion at that point. We live in a world where most (but certainly not all) consumers are for the most part unsophisticated about most things. Back when people had to make their own clothes, they knew a lot more about clothes. They could get something from the Sears catalog and see whether or not it was crap. Today, we live in a society with mostly paper pushers, or people who have highly specialized technical skills. An auto mechanic for example may have a trained eye when it comes or purchasing a good vehicle, but will tend to know nothing about buying good shoes. We are no longer a society where we are expected to fend for ourselves or make our own things. This is progress, but in the process makes us uneducated in terms of being able to evaluate many of the things we buy. This is why so much of what we buy can easily be considered junk - because we don't really know much better, manufactures will produce the least expensive item that will pass muster, and we are generally so far removed from the manufacturing process that what we are buying is more or less a mystery to us.

With luxury, the presumption exists that someone "thought about all that for me." That you are buying a more expensive item because the people behind it know what they are doing, and that connoisseurs who can choose whatever they like, choose "this." Marketers at (supposed or real) luxury brands know this. So they try to artificially create the illusion that this exists. If this state does exist, they simply trying to enhance or amplify it. I am by no means saying that "true luxury" never exists. I wouldn't be into nice things if it didn't - but enough companies are able to take advantage of people's desire for luxury. There are those of you who will disagree with my definition of luxury, and point to purely economic definitions, but consider my explanation of the concept as applied in this context.

Therefore, brands create artificially high prices and invest heavily in marketing to craft an image that it hopes will adhere to concepts of luxury that you value given your desire to have nice things that are well made and that other people who "know" might appreciate.

Why Are Watches So Expensive?   feature articles

5. Good watches take highly trained people a long time to make.

I recall visiting a high-end watch manufacture in Europe and being shown a few ultra complex timepieces that can take a team of skilled watchmakers a year to make. A year to make just one watch. They aren't exactly working on it full time, but it does take a long while when a mechanical watch must be made, finished, decorated, and tested extensively. Imagine how long it takes to delicately hand polish hundreds of parts by hand... under a microscope. The people doing this range in skill level, but the best of them are highly trained and certified by years of school. In Europe especially, these people are paid pretty well, and hours and hours of their time is valuable. Of course, most watches are assembled much faster, but this situation does exist, and impacts the costs of the best high-end timepieces a great deal. So when you take into consideration a year's worth of time f0r a highly trained team, you can understand why labor costs can highly impact some high-end watches.

6. A lot of people dip into profits.

People like to throw around the statement "you know how much that cost to make? And yet they charge XXXX?!" Don't forget that watches cost more than just the mere sum of their parts. Watches are expensive to design, manufacture, distribute, and market. These are all costs that are severely burdensome in the watch industry. In terms of profit dipping, the line from the manufacture to the consumer can be quite long.

I will create a very general example that represents how this works. A watch coming out of the factory costs $1,000 to produce in terms of parts and labor. The manufacture wishes to make some profit on the watch so the price to the distributor is $1,500. The distributor is in charge of getting the watch to retailers. But first the distributor needs to get the watches out of the country, and into other countries. This gets import and export taxes and duties involved - which vary greatly on the placed involved. They are often based on the value of the watches. In addition to paying these customs, the distributor also needs to take a cut for profit. The distributor also has to find retailers (and hires sales people). To cover all these expenses and make a profit, the distributor charges the retailer $2,500 for the watch. The retailer is then charged with getting customers in the store, and must hire and pay sales people (who are often on a percentage commission + base pay revenue model). Marketing costs are often (ideally) distributed between brand, distributor, and retailer. In order to cover these costs, plus the commission for the sales person in the store and get a profit, the retailer needs to charge $5,000 for the watch. You can now see how a watch that cost $1,000 to make can very reasonably be sold for $5,000 in a store.

It is for this very reason that selling online - direct to the consumer - is so very attractive for brands. They have been able to maintain a pricing scheme for years, and can charge the exact same price to the consumer and get a lot more profit. Plus, the experience for the consumer is virtually the same, and they can potentially buy a watch more conveniently.

7. "You don't know any better."

Few people are experts when it comes to the pricing and valuation of timepieces. This applies to many industries. The allure of luxury, performance, and presumed quality can mask what are modest underpinnings with pretty clothing. The bottom line is that many timepieces aren't that expensive to produce. They can charge a lot and not look horrendously silly because there does exists a substantial contingent of timepieces that are very expensive to produce. Believe me, there are timepieces that cost as much as a top of the line Mercedes-Benz and represent a "good value" given the costs to make them. Given the existence of these very cost intensive to produce watches, others attempt to bootstrap themselves to such quality players. This is despite the fact that they cost a small fraction of their retail price to produce.

How does one measure how much a watch costs to produce? A trained eye will keenly look at quality and materials to know how much work went into it. Others will simply have to trust brands that tend to garner a positive reputation, and visit sources like this (aBlogtoRead.com) that regularly discusses and covers what to look for in a watch, and what to avoid. You can always even ask a retailer (try to maintain such interrogation to highly expensive watches) a few questions that will shed light on the situation. Ask them the cost of manufacturing the watch (if they don't know then have them guess). Only the "best" sales people will lie to your face. You can also ask not only where the movement was produced and assembled, but also the watch case and other components. Parts make in Europe are generally much more expensive to make than in Asia.

While consumer ignorance is the cornerstone of Westernized retail, it doesn't have to be an issue if you know better when investing in a good timepiece. Trust me, there are brands out there that feel the concept of grossly misrepresenting the costs of making a watch a reflected in the price to the consumer is repugnant.

Why Are Watches So Expensive?   feature articles

8. Customers want to feel their worth.

A while ago Champagne maker Dom Perignon decide that it would reduce the price of its product in the hopes that they would sell more. The tactic totally backfired on them and sales dropped until they raised their prices again. The moral of the story is that price is a mental indication of worth to a consumers, unless you really (really) know what goes into a product and its competitors. This story is no different than from what happens a lot in the watch industry.

Prices often are set based upon desired market placement. It is the idea that if an item is priced at a certain level, people will associate it as being on par with brands of similar price, and that lower priced brands or models aren't as good. It is based on a sense of goodwill that consumers have toward product makers, but more to retailers, who they feel will charge just enough to make a profit and also remain competitive. While I am not suggesting that all watch brands participate in this practice to the same degree, this happens a lot (and of course is not unique to the watch industry).

There are a few outcomes of this practice. One I mentioned above about brand's wanting to appear more "luxury" than they are. Another is that wealthy consumers are able to feel like the items they have other people can't access because they cost to much. While 'exclusivity" traditionally meant something that was hard to get simply because it was rare or hard to make, with today's relatively commoditized luxury market - price and distribution are the artificial constructs of exclusivity. As such, wealthy consumers are offered a number of options when wanting to own items that other people can't access because they simply can't afford them. An artificially high price - if sustained in the distribution model (which is one reason why the gray market is a problem for luxury brands) - can create the desired type of exclusivity that luxury buyers demands.

Is it worth it?

In the end, an expensive watch is "worth the money" when looking at a few factors. First, does the quality match the cost? If you are getting $500 quality for $1000, the watch isn't worth it. Second, does the market justify the price? Are other people paying this amount for similar or the same watch? How is the resale market? Are such pieces being valued at auction? Third, in addition to the above two factors, does the name recognition associated with the brand justify a "price premium?" A watch with the name "Cartier" on it will cost more than the exact same watch without the name Cartier on it. Is that name worth it to you? If so, there is no harm in it, but you need to consider the personal value is has for you.

Overall there are many, many good watch values out there - and ones that even while very expensive in price are worth it. At the same time, there are brands out there that are trying to deceive ignorant buyers who are taken by a facade of luxury, and fallacious pricing practices. The cost of entry into the watch world isn't what it used to be. While no amount of money can easily replicate a Patek Phillipe brand, a relatively modest investment can get a set of watches made from suppliers in China. While this is fantastic for enterprising entrepreneurs and creative people who want to enter the watch industry with innovative concepts - there is no real oversight committee (a few in Switzerland, but they certainly don't cover an entire industry) making sure that watches are well made or match an level of quality. Bottom line is to consult with people you trust, because there are fantastic timepiece out there awaiting your discovery.

37 comments
MrMontreal
MrMontreal

I have not worn a single watch in atleast 15 years.

When ppl asking me " sir what time is it plz " i just tell them " i dunno , sorry "

There are so many ways to know what time it is.

Your computer, your cellphone, iphone, ipod, ipad, some booth phone, your car.. anyway.

And also, not wearing a watch allows more freedom in your movements.

Most watches are flashy and old style... I seldom see ppl wearing watch in nightclubs nowadays...

I always found watches and sunglasses to be overpriced in general. With few exceptions, most (90%) are way overpriced.

My 30 years old digit indiglo timex i had in elementary school is still working .
And it is still as accurate as new.

Oh and lastly, i'm married to a beautiful hot chix, i have a house and a car... in other words, i didn't need a watch at any moment to reach any of my goals.

However i respect anyone wearing expensive watches...

Chris
Chris

What a bunch of BS. A watch industry insider telling us how we should all feel good about how ridiculously overpriced watches are. Right... It’s a giant rip off, anyone who has ever been in any technology or manufacturing industry can tell you what costs go into parts, labor, R@D, materials, marketing, and distribution. Mechanical movements don't actually tell time any better than a $30 quartz does! They try and justify these costs because they have expensive and complicated movements. The money that goes into developing these watches is nowhere close to what they charge consumers. If you pay more than you think you're getting more. If that makes you feel good then fine, but don't confuse what it is you're actually spending your money on.

N.C.S.
N.C.S.

A throughly fascinating article. Thank you for sharing your thoughts. The concept of artificially preserving pricing to extend the scope of a brand into that of a higher echelon than truly deserving, is something to which I, and, it seems many others, subscribe.
Ariel, I fully agree that no man should deprive himself of a good watch, whatever his financial station in life. Nonetheless, there do seem to be watch makers out there who do find the concept of overpricing their goods repugnant. Two potential candidates seem to be Christopher Ward and Archimede.
But to someone who values watches, while these brands may do for the time being in terms of integrity and value, eventually, one wants to experience something truly luxurious and has to really move on. But here, it does seem the entry price to watch making nirvana starts in the several thousands.
This does not not need to be frustrating, but in the sphere, it would take some time for the average luxury watch seeker to separate overpriced from bona fide excellence worthy of the sum asked. This is what I find to be frustrating. Which decent reseller is realistically going to turn around and say of his own inventory, don't bother with that piece, it's just overpriced rubbish?

David
David

Casio MTP-1239, 1333 day-date module, SS water-resist case and SS band with push-to-release clasp. Keeps amazingly good time, great build quality, perfect size and heft for every day wear. Purchased retail in Singapore around a year ago for $26 USD before tax. This watch comes with a black or white face. Mine has a black face which can be a bit difficult to read at night. Why not buy two; one for day and one for night! Will this watch get you some? Well... works for me! And that's all I have to say about that.

THE PHOTOFREAK
THE PHOTOFREAK

you don't have to bother or wonder why watches are so expensive today. high end watches were always expensive . maybe the y are expensive for the average person but they are not for the average person. they are for the one who can affort to pay for them. for the rest of us we can only admire them and we always can buy vintage watches from various web sites . and i assure you their quality is very high compared with today's standards

Olivier Müller
Olivier Müller

Thanks for your input Ivan ! As fars as I'm concerned, I'm quite disappointed by the quality of counsel of multi-brands resellers. They don't know their brands, the 'turn-over' on displays doesn't bring satisfaction, etc. That's why we try to underline when a brand opens a dedicated store (like here : http://thewatchlounge.com/glashutte-says-bonjour-paris/ ). But not sure that middle range brands (not haute horlogerie) will keep their own stores but only corners in malls... Too expensive. Your opinion ?

Ivan Y
Ivan Y

Oliver -- thanks for your input. I didn't mean to suggest that off-topic discussions shouldn't happen. I've been on forums for way too long to know that could ever be the case. I just don't think essays on the subject of Ariel's writing are valuable.

Ariel -- thanks for the link to your article. Are you getting the feeling that brands are terminating ADs in large cities, where they can justify build their own boutiques, and keeping them in smaller towns? I'm in Houston and it seems like there are only 2-3 ADs for Rolex, Omega, Panerai, etc. (even less mom & pop stores since Tourneau is one of the ADs for most brands). Now, I don't know how many ADs we had a few years ago, but it seems like a small number given our population.

P.S. The main reason I do most of my shopping online is to avoid dreaded sales tax (8.25% in the city). Too bad, I couldn't do that with my car (even if bought out-of-state, still have to pay when registering)!

Olivier Müller
Olivier Müller

Yvan, even if I tend to agree with you, you can't ask people on a blog to stick to the initial content. This is where blogs and web are so rich, it enables people to develop many topics around a single one, and let the conversation flow from one to another unexpected one.

Ariel gathers some well educated people here, fortunately !, but you might have noticed that in some other forums, a quote like "Panerai are too expensive for what they really are" could have generated 100+ comments from die hard fans of the brand.

Anyway, as a journalist, it's always a pleasure to read web articles as if they were designed for print press. Thanks Ariel. Your angle and exhaustive approach here is really a pleasure - and it's funny to see the angle you chose, really different from ours, on strictly the same topic.

Best,

OM - The Watch Lounge

Daniel
Daniel

I would say just about any Invicta watch is overpriced. Watches like Rolex have a "legacy" cred to them that helps keep their value as well...

Gil
Gil

Excellent article. My doubt is on the distribution model example...If you go to Switzerland, let's say to Geneva to Rolex boutique there, where the Factory is probably few blocks away from the retailer, they'll sell you a watch for it's list price, which is more or less the same that if you bought it in another official retailer in another part of the world ...But in thjs case the overprice for the distribution chain, import taxes, etc. are pure earnings to the manfacture.

Ivan Y
Ivan Y

Can we get back to the subject at hand and skip discussions about grammar & spelling?

Maybe I don't know enough about watches, but Panerai doesn't seem overpriced to me due to the simple fact that they hold their value very well due to limited production quantities and brand loyalty. Similarly, Rolex maybe not the best bang-for-the-buck watch, but it's almost a liquid asset.

FYI, I don't own Panerai or Rolex, although I'm considering PAM177 or new 40-mm Rolex Explorer. Probably will settle for Citizen Chronomaster (CTQ57-1025) for a measly $3K (no thanks to USD/Yen exchange rate).

WatchMark
WatchMark

Grammar error on last sentence from my previous comment, should be "to", not "too." A perfect example of a grammatical error. Now if my previous comment was an actual article, don't you think as the writer I would want to go back and edit that sentence to make it grammatically correct?

Dangeruss
Dangeruss

WatchMark: "I’m hereby challenging you too write, at minimum, all of your articles with no spelling errors." Unitentionally hilarious?

WatchMark
WatchMark

"Writers should not be expected to edit."

You can't be serious..... Read that quote out loud, and then think about it for a minute. I think writers should be expected to edit, as that is part of a the writing process, especially if we are talking about writing in a professional capacity.

There a two, to, too many examples that can be used to prove why editing is important.

Bloggers are known to use conversational tones in their writing, but that does not translate to just spitting out words onto the screen. Writers, regardless of their specific title or capacity, should undoubtedly check for grammatical and spelling errors, at least once or twice after writing an article. It's simple, just read the article out loud. Editing does take extra time, but it's not that hard. You're a lawyer right? To become a lawyer, you have to be pretty smart right? Well, smart people use good grammar and spelling in their writing. My computer spell checks everything for me, so all I have to do is check my grammar.

I'm hereby challenging you too write, at minimum, all of your articles with no spelling errors.

Chris
Chris

My own a ha moment about watch cost came a year or two ago...I had my Tag Heuer 4000 quartz worked on - it had stopped running and it was not the battery. I got the watch for college graduation in about 1993 the cost was about $1000. The watch repair guy thought without opening it that the dial feet a broken and dial was loose stopping the hands. However, he also suggested putting in a new movement for about $60 - since the expensive part would be the labor to open the watch up in the first place. I started doing the math and looking at other brands with SS cases etc. An Invicta can sell an auto with SS case for $65 retail (InvictaShark today) with a Miyota movement. Their case and bracelet can not cost too much less the Tag case and bracelet. The whole 4000 watch itself must have a factory cost of less than $150 heck even less than $100. Ugh. Not a high value watch in my opinion - but I still have it.

I have a Benarus Sea Devil that I wear most days and a Remora on order. I think these watches represent solid value at about $500.

That said, in my own twisted logic I have come to the conclusion that Rolex may be the best value in watches. In house movement, great case, often COSC, strong brand, holds value, etc. I am now looking for a gently used Sub.

My own rule of thumb is that watches should cost about $500 or more than $5000.

PAT. i
PAT. i

The swiss "laugh"?!?
If the rumor is true I'm sure the pitch, length and time of day allowed is governed by the EU.

Christian
Christian

I agree with you Dangerous. I think Panerai is a highly overpriced brand.

Dangeruss
Dangeruss

Overpriced example: Manual wind Panerai. Seriously, there's "nothing" to those watches. The movement is ages old, with no recurring development costs. A flat stamped and painted brass dial, as simple stainless case. It is at most a $500 watch selling for $5K or more. Popular? Yes. Is the value relative to price? No way.

Christian
Christian

Superb article Ariel. A question, what would you say is the epitome of an overpriced watch today? just one...

The Rake
The Rake

I appreciate the effort you've put into the article. Good food for thought. Beauty ultimately is in the eye of the beholder and the cost or expense of watches to me fluctuates with my financial situation at any given time period, and the number and type of watches I own at that time. If a brand can charge exorbitant amounts for a watch and they are still bought, then the price was not exorbitant. I don't own a $250 t-shirt because I don't deem it necessary, but many people do and have no qualms with the purchase, so I guess the value in the shirt is worth it to them.

The Rake
htpp://thefilmnest.com

Ivan Y
Ivan Y

Excellent article! About distributors -- is that something that only smaller watchmakers use or do even big companies (Richemont group, Swatch group, Rolex, etc.) have to go that route to get their products to authorized dealers?

I understand the concept of distribution (my mother owned a distributor company), but given relatively small number of ADs, it seems like it could be something that large manufacturers would be able to handle on their own.

P.S. Related to that, it may be worth mentioning in the article that some brands are opening up their own boutiques.

Rocky
Rocky

Crispin, "Swiss are slapping their thighs with uproarious laughter" please post a video of this on YouTube, this I would love to see.

There is one easy (but lengthy) way to tell expensive or overpriced. If a new model is snapped-up at retail and disappears into private collections, it is expensive. If two years after introduction it is available new on the gray market for 60% off, it was overpriced.

pat i.
pat i.

The only thing true thing that sets the sale price of a luxury watch is demand and supply.
I'm not saying that watches aren't expensive to make. I understand that tons of money are spent on advertising and getting really dumb people to think that "yes. that's me - a male model with perfectly tousled hair, 5 o'clock shadow and wearing a flight suit. The plane in back of me? I have no idea how it got there".

The costs can be reduced, but like you said certain people will not buy the same watch for less - although this is odd because they'll haggle on the price at the time of purchase.

Watch manufacturers need to look to the auto industry. Although a BMW engine maybe completely different from a Ford, there are a lot of similar purchased parts (nuts, bolts, a/c units, etc.). When Chrysler was purchased by MErcedes, Chrysler models would get have Mercedes engines in them - once the Mercedes models got new engines - the nonrecurring costs like engineering, prototyping, tooling, etc was paid for.

In essence, Chrysler became Mercedes lower end brand - a good thing for consumers. Maybe what these wtachmakers should do is tweak the movements a bit, start a lower end line and sell watches with the same movements for less once the Oohh ahh factor has died down.

Crispin
Crispin

High development costs for haute horology is understandable citing low production numbers.... but, the Rolex Caliber 3135 was finalised what ? 22 years ago??? And yet, the prices for cases encapsulating this movement are ratcheted up, without abandon. An easy target, I will concede. Yes, prices convey to the consumer a perceived worth and ignorance does play a welcome part but, I always have this inkling that the Swiss are slapping their thighs with uproarious laughter at the way, they are bilking their clientele for machines, that were perfected eons ago. Either that, or they be exacting revenge for the 'quartz revolution' ;)

hogrider1234
hogrider1234

Very interesting info....and although I realize you may not be privy to insider information about what a watch costs to make vs sell, I would have really liked to see some examples...maybe next time...also please proofread and use spellcheck next time..

keep up the great website...I read each blog...thx

Witch Watch
Witch Watch

A very well written post,food for thought and not just were watches are concerned.

admin
admin

A watch isn't gonna make or break your life. But for many men having a nice one will certain enhance it. While you don't have a watch now, that doesn't mean having one in the future won't add a little something to your day.

admin
admin

Really nice feedback, thanks for the input Chris.

Ariel
Ariel

Well it is an interesting opinion. I don't think that people who can't afford a $50,000 watch should just say "shucks... too bad." There are good things for everyone out there. And my own personal view is that many vintage watches aren't quite what "romance" makes them out to be. Thanks for commenting!

admin
admin

Thanks Olivier.

admin
admin

What are you saying is true, but for price consistency reasons, Rolex can't have watches close by to the factory be less expensive.

admin
admin

It was a joke! Truth is that with all I do I simply don't have the time necessary for a good combing. Most journalists have editors and it is very tough to sometimes proof your own work. While it doesn't seem it sometimes, I do read over my stuff, but people often miss typos in their own work. I am currently in the process of looking for a good editing helpers. I won't take you up on your challenge, because it means I can't write the 5 articles a day I normally do. aBlogtoRead.com isn't the only place I write daily.

admin
admin

I think I have heard a Swiss person laugh once. But then again he might have been sneezing. Hard to say, lol. But honestly, what they say about the Swiss is often true, but there are some very pleasant exceptions with many people who are friends of mine.

admin
admin

Hard to say... probably quartz movement based watches with lots of precious jewels on them. They are usually very high-priced for prestige, but are known to be huge profit makers for watch brands. As such, these are mostly women's pieces.

admin
admin

Ivan,

While some larger groups also control distribution, there are still several entities involved. For example, from a corporate standpoint, Rolex Switzerland and Rolex USA are separate. And thus need to get paid separately. This is many times the case. In terms of brands opening up their own boutiques, I sort of alluded to the appeal of that. I discussed that more here a while ago in this article: http://www.ablogtoread.com/doomsday-coming-for-wrist-watch-retailers/

admin
admin

Fixed a few typos.. Writers should not be expected to edit. Glad you like it :)

Trackbacks