Authentic watch vs Replica

Rotty said:
jeewllers margins on watches vary for 50% - 200%

most mid range watches are machine produced and even worse in some cases, Tag generally buy in reasdy made components , subcontract case manufacture, assemble in far east and then pack in Switzerland to allow them to be badged swiss made


if you want to see the work that goes into high end watches this is interesting

http://www.jaeger-lecoultre.com/eu/en/manufacture/professions
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So you have a jaeger-lecoultre;)

So if I buy a watch for £1000, 500+ of it go to the person owning the shop? Hard to believe. Whats the source of your information?
 
Tefal said:
I'm not saying it doesn;t cost anything :/

Just that's it's overly complex to include it in a general cost to make one.

There's the total cost consisting of all R&D, wineing and dining of advertisers, shipping etc etc.

The basic labour and parts which is quoted most of the time, as the other is only known at the end of the production run.
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I don't know if I confused this early on by somehow unintentionally implying that you recouped an exact proportion of the R&D costs on every watch produced but that was not what I meant. For a production run you should build in a notional amount to cover the R&D (and other sundry costs), you might get it exact, you might create a surplus or there may even be a deficit in the amount raised but to not include a sum to cover this at all because you won't know the total cost until the production run has ended is a strategy that I've never heard of because it would almost certainly lead to the failure of the business.

Tefal said:
Kindda the point of it, it;s a nice basic principal, etc if every watch after R&D only costs say £1k in man hours and 100 quid of material (random figures). but cost some very gifted engineers 100million to design, you can't really say it's really worth that much, as although the design is amazing, it's production is still done by the lowly techs and not the designers.
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Yes, you can. If it wasn't for the designers then the product wouldn't have been conceived for those 'lowly techs' to make. Whether you want to pay that much for it or whether there were glaring inefficiencies in the production chain that bumped up the costs are another matter entirely and completely separate to how much it is worth to the company.
 
Cheekykid said:
A bit out of topic

Any idea why the TAG link series are always more expensive than the Aquaracer and other ones? Is it because they use jewels?
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the bracelet is a little more complicated ( and much the worse for it ) but mainly is is due to market positioning
 
Cheekykid said:
So you have a jaeger-lecoultre;)

So if I buy a watch for £1000, 500+ of it go to the person owning the shop? Hard to believe. Whats the source of your information?
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general knowledge amongst watch folks

Take a Tag costing £1000 , 20% discount will probably be given, £120 VAT , cost price about £350 , do dealer cut will be about £330

bear in mind volume of sales that is not that huge

at the higher end percentage margins become less


I bought a Gucci watch from a dealer at trade , retail was £1395 , I paid £500 and that was what he said was trade , may even have been less
 
Rotty said:
the bracelet is a little more complicated ( and much the worse for it ) but mainly is is due to market positioning
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So the link being automatic,bigger bezel and having jewels makes no difference to the price tag?


Rotty said:
Take a Tag costing £1000 , 20% discount will probably be given, £120 VAT , cost price about £350 , do dealer cut will be about £330

bear in mind volume of sales that is not that huge

at the higher end percentage margins become less


I bought a Gucci watch from a dealer at trade , retail was £1395 , I paid £500 and that was what he said was trade , may even have been less
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Back then when the pound was stronger and the dollar weak I could get online the same tag watch for half the price in america compared to the highstreet shops so there is definetely a margin but this example isn't enough due to different market conditions, import/export taxes etc.

There are no discounts in famous high streets shops to normal unknown customers so the 20% is irrelevant as is the VAT which goes to the government.

Profit margin of 200% for the shop owner is surely overstated or it refers to scam shops.

Surely they are overpriced in shops but if you get your watch online the margin must be a lot smaller and it is in my experience. For example I bought my Tag from america £600 cheaper than Ernest Jones. That is £600 pure profit for "them" or there are other things we are missing?
 
Cheekykid said:
So the link being automatic,bigger bezel and having jewels makes no difference to the price tag?




Back then when the pound was stronger and the dollar weak I could get online the same tag watch for half the price in america compared to the highstreet shops so there is definetely a margin but this example isn't enough due to different market conditions, import/export taxes etc.

There are no discounts in famous high streets shops to normal unknown customers so the 20% is irrelevant as is the VAT which goes to the government.

Profit margin of 200% for the shop owner is surely overstated or it refers to scam shops.

Surely they are overpriced in shops but if you get your watch online the margin must be a lot smaller and it is in my experience. For example I bought my Tag from america £600 cheaper than Ernest Jones. That is £600 pure profit for "them" or there are other things we are missing?
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cost of goods sold in many areas of retail are around 40% to 50% of the sale price, in some luxury products much less, that is totally normal. They have to rent the shop, pay the staff, insure, make a profit etc.

Anyone who makes a purchase such as a decent watch and does not ask for a discount is just throwing money away. Would you buy a car at the list price?
 
Cheekykid said:
There are no discounts in famous high streets shops to normal unknown customers so the 20% is irrelevant as is the VAT which goes to the government.

Profit margin of 200% for the shop owner is surely overstated or it refers to scam shops.

Surely they are overpriced in shops but if you get your watch online the margin must be a lot smaller and it is in my experience. For example I bought my Tag from america £600 cheaper than Ernest Jones. That is £600 pure profit for "them" or there are other things we are missing?
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20% discount is easily avaiable to anyone on many makes, I asked my missus to pick me an Omega up while she was downtown and while ago and she managed 21% off from a high street authorised dealer

re the 200% mark up ( maybe not all profit but this is about the wholesale to retail markup ) on some models if you don't believe me then fair enough, these sorts of margins are normal on the hugely commercial brands such as Tag and Gucci
 
Cheekykid said:
Lets say a Tag aquaracer vs Tag Link 25 jewels. Do you want specific models?
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if the Aquaracer is quartz then of course the auto Link would cost more and, for example, a better movement like the Calibre 36 more still

jewels on their own do not mean much, they are only synthetic bearings and while more complex ( and expensive ) movements often have more jewels the amount of jewels on it's own means little
 
Rotty said:
if the Aquaracer is quartz then of course the auto Link would cost more and, for example, a better movement like the Calibre 36 more still

jewels on their own do not mean much, they are only synthetic bearings and while more complex ( and expensive ) movements often have more jewels the amount of jewels on it's own means little
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Is calibre 7 better than 5 or the numbers mean nothing?
 
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We should note that the bracelet adds to the price quite a bit. Rolex is the only company that uses 904L steel and it costs 3 times as much as the 316L which is what many brands use.
 
Interesting thread. I have four Tags and a Breitling of which one is real and the others cost me less than £10 each. For preference I wear one of the fake Tags because it has a chrono function which I like to play with in meetings to keep me from going to sleep. I'm completely open that most of them are fakes and don't think of them as Tags or fakes but simply "watches". One of them is over ten years old and still keeping great time.
 
semi-pro waster said:
I don't know if I confused this early on by somehow unintentionally implying that you recouped an exact proportion of the R&D costs on every watch produced but that was not what I meant. For a production run you should build in a notional amount to cover the R&D (and other sundry costs), you might get it exact, you might create a surplus or there may even be a deficit in the amount raised but to not include a sum to cover this at all because you won't know the total cost until the production run has ended is a strategy that I've never heard of because it would almost certainly lead to the failure of the business.



Yes, you can. If it wasn't for the designers then the product wouldn't have been conceived for those 'lowly techs' to make. Whether you want to pay that much for it or whether there were glaring inefficiencies in the production chain that bumped up the costs are another matter entirely and completely separate to how much it is worth to the company.
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Well he argument was in context to the "build quality" so for example a car may cost more to design than a watch(per unit, considering cars are sold close to cost this may wel be true) but would you say a car which cost more in design but was built by robots, to be of superior build quality?

As id claimed by the watch enthusiasts.
 
Cheekykid said:
[..]
A question for someone who knows about this subject. Does a watch with 20+ jewels etc. really costs thousands to be made? How can they justify the price?
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You could sell your toenail clippings for £10000 if someone was willing to pay that much for them. Price has nothing to do with what is justified, merely what generates maximum profit. So a watch with the right name on it sells for a hundred times as much as it costs to make, or more, because there are people who will buy it at that price. Low volume, ludicrously high profit margin = maximum profit. They'd make less profit if they sold the same watch for "only" 10 times the manufacturing costs, because they wouldn't sell 10 times as many. Maybe they'd sell fewer.

It's the same for anything. £5000 handbags, for example.
 
Tefal said:
Well he argument was in context to the "build quality" so for example a car may cost more to design than a watch(per unit, considering cars are sold close to cost this may wel be true) but would you say a car which cost more in design but was built by robots, to be of superior build quality?

As id claimed by the watch enthusiasts.
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I'm not certain I've got quite what you are asking but I'll answer what I think you mean. Robots don't tend to make mistakes and can work to tighter tolerances than most people so in that sense you can argue they are higher quality but the equivalent handbuilt product will almost invariably cost more because they are handmade.

Just because something costs a lot to design doesn't inherantly make it a superior product but the cost of designing it does have to be paid for somewhere.
 
Red and White said:
fakes tend to break after 5 minutes anyway. they stop as soon as you get home.
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That depends on how bad they are. Someone I know once bought a few fake "Rolex" watches when they were on holiday. The one that cost them £25, which was the most expensive one, is still working 5 years later. It looks just the same as a real one to me, though I expect an expert could tell them apart.

I wouldn't buy a fake - what's the point, other than fooling some people into thinking you spent far more money on a watch than you actually spent?
 
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