Cost of manufacturing brand watches compared to their selling prices
The watchmaking industry is one of the most luxurious industries that is highly sought after by luxury and precision lovers. These watches are characterized by their high quality and unique designs, which makes their prices very high in the market. Whether they contain precious stones and metals or not, these watches require advanced technologies and high-quality materials.
cost of making brand watches
Watches with precious stones and metals
The cost of manufacturing these watches depends on several factors, including:
1. Raw materials:
- Precious metals such as gold, silver, and platinum.
- Precious stones such as diamonds and rubies.
- Special types of glass such as sapphire.
2. Technology and accuracy:
- Complex and advanced mechanisms.
- Water and dust resistance technologies.
- Accuracy in time and additional functions.
3. Skilled labor:
- Craftsmen specialized in watchmaking.
- Watch designers.
- Engineers and mechanics.
4. Research and Development:
- Costs of researching new technologies.
- Develop innovative designs and mechanisms.
5. Marketing and Distribution:
- Advertisements.
- Distribution and shipping costs.
The cost of making a high-quality brand watch ranges from 10,000 to 50,000 Saudi riyals or more, depending on the complexity of the design and the materials used.
Watches that do not contain gemstones or precious metals
For luxury watches that do not contain gemstones or precious metals, the cost depends on:
1. Raw materials:
- Stainless steel.
- Titanium.
- Regular or crystal glass.
2. Technology and accuracy:
- Advanced and precise mechanisms.
- Water and dust resistance technologies.
3. For skilled labor:
- Craftsmen and designers.
- Mechanical engineers.
4. Research and Development:
- Development and design of innovative mechanisms.
5. Marketing and Distribution:
- Advertisements.
- Distribution and shipping costs.
The cost of producing these watches ranges from 5,000 to 20,000 Saudi riyals.
Selling prices
Brand watches are sold in the market at prices ranging from 30,000 Saudi riyals to more than 500,000 Saudi riyals, and may even reach millions of riyals for some limited editions or custom watches. As for luxury watches that do not contain precious stones or metals, they are sold at prices ranging from 10,000 Saudi riyals to 100,000 Saudi riyals.
Compare numbers
- Production cost for watches containing precious stones or metals: 10,000 to 50,000 Saudi riyals.
- Selling price: 30,000 to more than 500,000 Saudi riyals.
- Production cost for watches without gemstones or precious metals: 50 to 20,000 SAR.
- Selling price: 1000 to 100,000 SAR.
profit margin
The profit margin depends on the brand, the level of luxury and the quality offered. Typically, companies make profits ranging from 100% to 9000% of production costs, and in some cases this percentage may be much higher due to scarcity and high demand.
Practical examples
Let's take two practical examples:
1. Rolex watch:
- Production cost: about 40,000 Saudi riyals.
- Selling price: about 150,000 Saudi riyals.
- Profit margin: about 110,000 Saudi riyals (about 275%).
2. Tag Heuer watch without gemstones or precious metals**:
- Production cost: about 10,000 Saudi riyals.
- Selling price: about 30,000 Saudi riyals.
- Profit margin: about 20,000 Saudi riyals (about 200%).
Conclusion
These figures show that luxury watches, whether or not they are set with precious stones and metals, require a significant investment in raw materials, technology and skilled labor. These watches generate significant profits for manufacturers due to their high demand, rarity and outstanding quality.'