Business Overview

Despite the prevalence of smartphones that easily display the time, watches continue to be popular. In particular, there remains a steady demand for high-end, luxury watches. Online watch and jewelry sales in the United States alone totaled $8 billion during 2017, and the segment has seen sustained annual growth of 12.3 percent over the past five years. Even smartphone makers (most notably Apple) can’t ignore the demand for watches and are producing smart versions of luxury watches.

A watch business sells watches to consumers who are interested in wearable timepieces. Thanks to sustained demand and a large market, this is an industry that’s ripe with opportunity.

Who is this business right for?

Anyone who has a passion for chronometers may be well-suited for running a watch store. Successfully running a store requires understanding why people want watches. People who themselves love and want watches already have this knowledge, which is knowledge that can’t easily be learned.

What happens during a typical day at a watch business?

A typical day at a watch business consists of:

  • Fulfilling orders
  • Ordering more inventory
  • Responding to customer inquiries
  • Running advertising campaigns

Some business owners may also perform repairs related to warranty claims, but business owners who don’t have technical repair skills can outsource this work.

What is the target market?

The target market for watches tends to be adults who have discretionary income and appreciate style. These customers will use watches to make fashion statements, and they have money to spend on watches.

How does a watch business make money?

A watch business makes money by selling watches. Watches are normally sold individually, but collections can be curated to encourage customers toward buying multiple watches.

What is the growth potential for a watch business?

A watch business can be a small one-person operation that serves a relatively small number of customers, or it can grow to have lots of sales and fulfill large orders for many watches. One company that started small but then grew is Modify Watches. Modify Watches’ first few sales were only to family and friends. The company eventually has since then fulfilled corporate orders for Google and Sega, both of which gave the watches to employees.

Getting Started

What are some skills and experiences that will help you build a successful watch business?

Starting a watch business requires a knowledge of both watches and of how to run a business. Business owners must at least have a cursory knowledge of watches so that they can make wise inventory decisions and properly converse with customers. Basic business knowledge is essential to making sure a business is profitable.

Business owners who aren’t familiar with watches can take a watchmaking course, such as those offered by TimeZone Watch School and Learn Watchmaking. Even if business owners don’t plan on building watches by hand, the skills taught in these courses will help when selecting inventory. With the knowledge in these courses, business owners can identify which watches are well-made and which aren’t.

There are also a number of business classes available online. Some popular ones include those offered by Coursera and listed on Open Culture. Business owners without previous experience should focus on classes that teach the fundamentals of running a business rather than courses on complex and obscure topics.

What are the costs involved in opening a watch business?

The startup expenses involved in opening a watch business are manageable. They include:

  • Purchasing inventory to sell
  • Setting up and hosting a website
  • Running advertising campaigns

Because watches are small, businesses don’t need much room for storing inventory. An entire business can be run from a home office.

Business owners who have limited capital can minimize these expenses by opening with a limited inventory, setting up their website themselves and focusing on organic advertising methods.

What are the steps to start a watch business?

Once you're ready to start your watch business, follow these steps to ensure that your business is legally compliant and avoid wasting time and money as your business grows:

  1. Plan your business. A clear plan is essential for success as an entrepreneur. A few important topics to consider are your initial costs, your target market, and how long it will take you to break even.
  2. Form a legal entity. Establishing a legal business entity prevents you from being personally liable if your watch business is sued.
  3. Register for taxes. You will need to register for a variety of state and federal taxes before you can open for business.
  4. Open a business bank account. A dedicated checking account for your watch business keeps your finances organized and makes your business appear more professional to your customers.
  5. Set up business accounting. Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
  6. Obtain necessary permits and licenses. Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
  7. Get business insurance. Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
  8. Define your brand. Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
  9. Establish a web presence. A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.

Select your state below for an in-depth guide on completing each of these steps in your home state.

Where can I find a business mentor?

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Recommended: offers video courses and a supportive online community of like-minded entrepreneurs. Try one month membership for for free.

What are some insider tips for jump starting a watch business?

Most watch businesses today are online. While it may be tempting to set up a stand in a high-traffic area, even a small physical retail space invites more risk and offers limited potential.

Businesses with physical locations must pay rent and carry more inventory, and they can only reach customers who pass by. Moreover, customers who are interested in watches likely won’t make an impulse purchase. They’ll instead want to compare options and prices online.

Ecommerce watch businesses come with limited risk, are flexible and have more potential. Therefore, efforts are better invested in an online watch business than a brick-and-mortar one.

Growing Your Business

How to promote & market a watch business

Almost any online advertising method can be used to market an ecommerce watch business. One of the most effective advertising methods, however, is email marketing. Jonah, owner of Watch Outfitters, generates $500 in sales each week with a single “Watch of the Week” email.

Recommended: Get started with local advertising for your business with a $300 credit from Yelp.

How to keep customers coming back

Because of the influx of phones, watches are no longer a functional accessory. Instead, they’re worn for fashion.

Businesses must keep this in mind and create content with style in mind. One anonymous but thorough guide to creating a watch business detailed how to:

  • Come up with a brand name
  • Create a brand’s story and history
  • Show customers how a brand provides value
  • Write luxurious-sounding product descriptions
  • Use images to show craftsmanship

It’s no accident this list focuses on marketing and leaves out actually selecting a watch. The guide actually refers to the physical watch as “the less important.” While quality can’t be ignored completely, marketing is what drives sales.

How and when to build a team

Most watch businesses are small operations. Jonah, for instance, started his business himself. Business owners typically hire employees once the work becomes too much for them to handle and sales support the cost of bringing on staff.

Legal Considerations

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a watch business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, check out our informative guide, Sales Tax for Small Businesses.

For information about local licenses and permits:

Reduce Personal Liability

Structuring your business as a limited liability company (LLC) ensures your personal assets are protected in the event your business is sued.

What is an LLC?

Form an LLC in 5 easy steps

Earning Potential

How much can you charge customers?

Watches can sell for anywhere from a few dollars to tens of thousands. Most new watch businesses begin with watches priced around $50. This price point isn’t prohibitively expensive yet provides a reasonable profit margin. As a business establishes a customer base, lower- and higher-priced watches can be offered for diversity.

What are the ongoing expenses for a watch business?

The ongoing expenses for a watch business are manageable. They include website hosting expenses, the cost of purchasing inventory and paying for any warranty claim repairs.

How much profit can a watch business make?

A watch business can make a substantial profit even in its first year. Within one year of opening, Watch Outfitters was bringing in $13,500 in sales each month. That’s an annual gross revenue of $162,000, and a lot of that is profit.

How can you make your business more profitable?

A watch business can increase its profits by designing and building its own watches. This involves more work but gives a business truly unique watches to sell. Additionally, the profit margin on watches is more when the watches are assembled from individual parts rather than purchased as manufactured units.

Next Steps

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