Why are some watches more expensive than others? How much does it cost to make a watch? While the cost of a watch depends on the watch type, watches tend to have a unit cost of between $50 and $200 on average.
Cost Of Production Of Luxury Watches
As stated earlier, watches are not too expensive to make. For example, we can look at how much a Rolex watch costs to make. Less than 15% of the cost of Rolex watches goes into producing the watch as a time-telling instrument. The rest of the costs are used in surviving the watch brand. A 10,000 Rolex watch may only cost 1000 dollars or less to produce.
But what brought luxury watches into existence? The reason why there are luxury watches lies in the history of watchmaking. In the 17th century when watches were invented, watches operated mechanically with no need for batteries. These types of watches rely on the craftsmanship of their makers in terms of durability and accuracy.
In the 1960s, quartz watches were invented. These types of watches were more accurate and cheap to mass produce. Their arrival relegated mechanical watches from the market just like cars did to horses, leading to what was then known as the Quartz Crisis which saw the death of several mechanical watch brands.
Mechanical watches were salvaged into luxury watches in the 1980s when owning a mechanical watch became a symbol of wealth and prestige. Since the demand for mechanical watches is not so high among the general population, their prices needed to remain high to ensure the survival of the brands that produce them.
Luxury watch brands like Rolex don’t get to keep all the profit they make as they need to constantly spend massively on; advertising their products to entice customers who can afford them, research and develop better ways to make watches, maintenance, and a fair wage for their highly skilled workers who assemble watch parts by hand. The few watches they make yearly must carry all these costs with a good profit margin.
What Are The Factors That Affect The Cost Of A Watch
Inflation
When there is inflation, the prices of materials used in the production of the movements of watches become expensive prompting a rise in the cost of the watch.
Type Of Movements
The materials from which watch movements are made from affecting the cost of production of the watch. While some movements are made of brass, some are made of steel and even gold sometimes. Jewel bearings which are movements that reduce friction are made of precious stones.
Raw Materials Source
The cost of watches is affected by whether raw materials need to be outsourced or not. When watchmakers outsource raw materials, factors that affect the chain of supply of the materials affect the cost of production of the watch.
Composition Of The Body
Luxury watches won’t be luxurious if the body of the watches is not made to look like it. Away from the internal anatomy of the watch which cannot be assessed at a glance, the makeup materials of the body of a watch are what allows the public to truly appreciate the royalty of a watch. Whether at the request of customers or the desires of the brand, the body of watches can be coated in rare earth metals, an example of how the cost of a watch can jump from mere thousands to millions of dollars. Luxury quartz watch brands like Seiko make expensive quartz watches by coating their body in rare earth metals too.
Cost Of Production Of Quartz Watches
Quartz watches may not last a lifetime, their cheap cost means you can always get another after 3years or anytime they become faulty without the need for repair.
Quartz watches are very cheap because they’re easy to mass produce. They do not contain delicate moving parts that need to be carefully crafted by experts yet they are more accurate.
Quartz watches contain quartz crystal that senses time and microchips which reads information from the crystal and express it through an LCD or LED display.
Each of these components is readily available and you can even make your watch yourself if you have the expertise. Quartz watches can be made expensive by making their body casing from luxury materials like gold or diamond. However, they won’t be as costly as their mechanical equivalent.
FAQs
The major reason people buy expensive watches is for the honor and prestige it brings. As a holder of the most expensive watch in the world, your name will always be mentioned in association with that title.
The type of watch you purchase should be defined by your preference and purchasing power. If you like expensive watches and can afford them, then don’t hesitate to buy one. Expensive watches can also be a form of investment as they can last for generations.
Mechanical Watches may be associated with luxury, however, for as low as $50 you can get yourself a basic mechanical watch and half of that for a quartz watch.
Different watch types have different pros and cons. As an instrument for telling time, quartz watches are the most accurate but they are inexpensive. So if you want a watch of elegance and prestige, then you need luxury watches at the expense of precision. Which is better is determined by your taste.
Like We’ve Discussed
The cost of making a watch is only a small fraction of the total cost they are sold for, especially when they are luxury watches. However, brands spend an enormous percentage of their profits on research and development, advertisement, and also huge wages for their highly skilled workers. These accumulate to the high cost of watches in the general market.
