Profit Margins

[krkqm2008]

My brother and I were having a conversation on profits in China, I wonder if anyone of you have an idea off a 500$ AP or a Rolex 500$ what the profit margins are.
since we are paying top dollar for these reps
and still needing to mod them

 

[dadog13]

This topic has been covered several times in different threads. Look around (search function) and try to find the thread(s)..

 

[krkqm2008]

Thanks for the reply
didn’t know if it was

 

[nalomb]

Top dollar? Really?

The gross profit margin is relatively high, but so is the risk and waste/loss quotient. After all is said and done, I'd be surprised if it was over a 25% net margin. These trinkets cost <1-10% of their genuine trinket counterparts. Pretty good for the consumer I'd say. Another way to look at it is, who cares? Clearly there are plenty of people satisfied with the product -- if they are marking it up 10,000% does it matter and do you have any recourse? Someone could always undercut pricing and if there was such an opportunity (without the disparity in delivered quality) it will make itself apparent in the marketplace. In other words, I don't think rep consumers are being screwed by the ChiComs ...

 

[krkqm2008]

Well money is relative just like time
so I think 500$ is a lot of money for a regular hard working blue collar American
so it was just a reference
but your paragraph makes a lot of sense
nalomb thanks for the reply

 

[BIONONE]

Top dollar? Really?

The gross profit margin is relatively high, but so is the risk and waste/loss quotient. After all is said and done, I'd be surprised if it was over a 25% net margin. These trinkets cost <1-10% of their genuine trinket counterparts. Pretty good for the consumer I'd say. Another way to look at it is, who cares? Clearly there are plenty of people satisfied with the product -- if they are marking it up 10,000% does it matter and do you have any recourse? Someone could always undercut pricing and if there was such an opportunity (without the disparity in delivered quality) it will make itself apparent in the marketplace. In other words, I don't think rep consumers are being screwed by the ChiComs ...

+1

that was what i need to read hehe

 

[Fiddo]

The "factories" are the ones that make the money.

 

[Crazivi3tdude]

You can pay me enough to make a rep this good looking or near, so I pay good money for a good looking rep since gens are over priced

 

[uphoto]

I think they charge what they do because of the lack of volume in comparison to having to retool or make so many different styles of watches. It is sad though that I can buy a $100 watch with a bezel that is lined up right or that doesn't have tons of play in it or get a watch that's waterproof yet pay $400-$700 for a rep that can't touch water or the movement lasts months not decades.

 

[dadog13]

The "factories" are the ones that make the money.

Dealers with big sales make a huge amount of money too..

 

[vcappp]

Look at this watch. The price is only a few dollars. Chinese factories make this fully functional real automatic watch for less than $9 dollars and free shipping offered. This is amazing and crazy. You can see more complex watches selling at only $3 dollars with free shipping.

$300 - $ 500 retail is enough money for them building any complex watches. still cannot believe how they can make this with this small money.

They just don’t have brand name, heritage, history and standardized quality control skills.

There are huge margins if they sell a watch for $300 - $ 500 price point.






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[uphoto]

None of those features work though on a watch like that. I once ordered a couple cheep watches on aliexpress and they are REALLY shitty. Spent $20 on an automatic that I would never wear and them $80 on another automatic that didn't have a functioning chronograph. The reps are much much higher quality than the crap you get from aliexpress and DH gate but aren't as nice as say a Seiko or Orient.

 

[vcappp]

None of those features work though on a watch like that. I once ordered a couple cheep watches on aliexpress and they are REALLY shitty. Spent $20 on an automatic that I would never wear and them $80 on another automatic that didn't have a functioning chronograph. The reps are much much higher quality than the crap you get from aliexpress and DH gate but aren't as nice as say a Seiko or Orient.

No, I didn’t buy it. I don’t buy anything from aliexpress and dhgate. What I am just trying to say is that the Chinese factories are able to produce this kind of complicated watches by a few dollars. By the way, the product description says it is all functional and also people’s review says all the features are functional.


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[BIONONE]

No, I didn’t buy it. I don’t buy anything from aliexpress and dhgate. What I am just trying to say is that the Chinese factories are able to produce this kind of complicated watches by a few dollars. By the way, the product description says it is all functional and also people’s review says all the features are functional.


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fully functional calendar based off a shitty DG2813 that will die soon...

But i get your point. Dissecting this kind of movement makes me think "how the hell is it possible to get all those parts into one functional thing for under $5 ?"

 

[Tigerdragon]

I think they charge what they do because of the lack of volume in comparison to having to retool or make so many different styles of watches. It is sad though that I can buy a $100 watch with a bezel that is lined up right or that doesn't have tons of play in it or get a watch that's waterproof yet pay $400-$700 for a rep that can't touch water or the movement lasts months not decades.

Thats funny because my 220€ Heinrichssohn watch had a second hand which falled down.

So they fixxed the shit watch 5 times in 2 years, today i looked at it and again the second hand is loose again -.-

Other cheap watch had a "Stuck" second hand (was banging against the glass) so i tried to lower the movement (nothing more) and the whole watch was falling apart (yes completly lol).

Sorry never had such issues with a rep even my 150€ regmariner didnt had such problems even my 140€ 15202 quartz rep with "shitty" bracelet looks far better than the most watches in that price league and have no problems with movement etc.

 

[nipe]

Ignorance is high in this thread.

If TDs offer free replacement on shipment that gets lost that alone should give you an idea about the margins. Keyword here is VOLUME. When JF made the 5digit TC killer I believe they started out with a bulk order of some 20k+ cases. If you think that JF has a production cost higher than $30-60 you are out of this world. If you think TD's buy these and expect to make a 25% margin you are out of this world.

 

[Princewilliam]

Well money is relative just like time
so I think 500$ is a lot of money for a regular hard working blue collar American
so it was just a reference
but your paragraph makes a lot of sense
nalomb thanks for the reply

I’d happily pay more if the regular hard working Chinese person making these watches gets a decent cut. Maybe the blue collar American shouldn’t be buying things he can’t afford


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[krkqm2008]

Princewilliam indeed, no one should be buying anything they can’t afford, but 500$ is still a lot of money

 

[reppists]

Let's take the latest rolex noob daytona 4130 clone for example,
noob are selling them for around 400USD per unit (convert from rmb), roughly around 30% costs goes to R&D (such as development, prototyping, buying gen to replicate), , 10% for the assembling and material costs, 10% for the equipment costs, and the rest are profit.
Different TD charges different prices,(which varies between 60USD - 300USD), therefore at the end you will get something around 600USD for a replica.

 

[nalomb]

Less rent/overhead, debt service, labor, transportation, packing materials, website/marketing, waste/theft/loss ...


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