The Breitling Watch Source Forums

First off, I'm so glad I joined this forum because if I hadn't I probably would have been happy to pay very close to retail recommended price for my Super Avenger.

Now when I go to buy, I'll be looking for at least 15% discount

Thing is I've read how alot of people have managed to get discounts between 30-40%

Do the dealers even make much profit at these sort of discounts?
Really does go to show what a markup these watches command.

It's been discussed before. Most countries charge ADs 55% of list, or thereabouts, although in the US it's just gone up.

That gives capacity for some fairly hefty discounting in North America where other costs are relatively low (particularly staff costs), but the difference has to cover the discount, commission, profit, and a share of AD costs - salaries, rent, insurance, taxes, utilities, corporate overhead, etc.

As a business owner I can tell you that those costs can get very high, very quickly.

30% - usually a best case scenario and becoming increasingly difficult to come by.
40% - impossible unless you are a VIP at your dealer, its some unloved closeout model, or the store is going out of business or dropping the Breitling line altogether.

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-RJ

True enough in the US, but that's (in part) a reflection of the increased dealer costs. Things are still a little easier north of the 49th, at least for me, although I recognise that I may not be typical.

No doubt about overhead. In the 80s my partners and I were easily able to keep overhead to 40% of average revenues. 60% to split up made for some nice largess (which went further for me then as oppossed to now - I wore a $100 watch!), but by 2000 we were lucky to keep overhead at 60% in my niche of the indusry we were in.

Rent, utilities, supplies, staff salaries, FICA, unemployment insurance, worker comp insurance, liability insurance, health insurance, marketing, computer updates/upkeep.................adds up pretty quickly in a business office setting.

On the other hand, the 80s had mullets!

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SHARKMAN

This is one of the biggest reasons why the discounts vary so much from market to market. In North America AD staff are considered to be retail with relatively low base salaries and relatively high turnover. In Europe the role is considered to be more specialist and higher salaries result in recognition of the knowledge and commitment to gain it. That tends to leads to better AD knowledge and lower turnover, but also contributes to lower discounts.

Generalising to be sure, but it's one of the key differentiators in a relatively significant cost area.

Having said all of that, in Canada at least, the only way to make money in watch retail is to either:

1) Dominate the market and have tremendous volume to distribute overhead across (and even there the major retailer has to leverage the distributor's infrastructure to try and manage costs further) or

2) Have high end jewellery in addition to watches because that tends to be higher margin

Repairs / servicing used to be a good way to make money but the training and equipment requirments that the major brands require, along with the insistence that anything beyond basic servicing is centralised has eroded that line.

On a related note, I have an account with a watchmaking supply house because of my watchmaking and they offer relatively low end straps where the wholesale price is only around 30% of the retail price.