How to Start a Watch Repair Business

Start a watch repair business by following these 10 steps:

1. Plan your Watch Repair Business
2. Form your Watch Repair Business into a Legal Entity
3. Register your Watch Repair Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Watch Repair Business
6. Get the Necessary Permits & Licenses for your Watch Repair Business
7. Get Watch Repair Business Insurance
8. Define your Watch Repair Business Brand
9. Create your Watch Repair Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your watch repair business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Watch Repair Business Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a watch repair business?

The initial cost of a watch repair shop is about $40,000. This amount covers initial franchising fees, a small workshop, watch repair parts, and a repair desk. Additional money can also be spent on educational fees.

What are the ongoing expenses for a watch repair business?

Expect to pay about $2,000 for a highly visible rent location. A lot of your watch repair tools will be purchased upfront, but you can spend as much as $500 per month to manage and replace these tools. Tools depreciate, too, requiring eventual replacement.

Who is the target market?

Watch repair shops make the most money from watch and clock enthusiasts. Customers with designer, collectible or otherwise rare watches are valuable. They often respect the art of watch and clock repair. They may also be return customers, if they’re sporting a collectible. These customers also return often for watch cleaning. While a watch repair shop may make most of its profits from watch repair, it can make extra money by offering watch cleanings.

How does a watch repair business make money?

A watch repair shop makes most of its money by repairing wristwatches. It can also make money by repairing pocket watches and clocks, however. A serious watch repair shop owner can make money by selling individual parts. They can even become a trusted watch parts provider.

Some watch repair shops may offer routine watch cleanings. By using a specialized machine, shop owners can ensure safe, effective cleanings after any tune-ups have been completed.

How much can you charge customers?

Each customer can be charged about $150 for a single repair job. This price is based on repairing stem, crown, or mainspring parts. Cleanings can be done for as little as $20. You can charge higher prices if you’re working on expensive watches.

How much profit can a watch repair business make?

A watch repairer can make between $24,000 and $36,000 per year, depending on their expertise. If they operate a shop, they can make a six-figure salary. To make this much, however, a watch repair shop owner needs to be incredibly marketable and reach a wide audience.

How can you make your business more profitable?

Offer services online. A lot of modern watch repair shops let customers ship watches to them. Because a lot of watch-wearers are turning to smartphones, the watch repair industry has become less effective. You’ll need to have a solid marketing plan to thrive.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your watch repair business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 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.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 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.

State & Local Business Licensing Requirements

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

Service Agreement

Watch repair businesses should consider requiring clients to sign a service agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example service agreement.

Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your watch repair business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.

Certificate of Occupancy

A watch repair business is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws and government regulations have been met.

• If you plan to lease a location:
• It is generally the landlord’s responsibility to obtain a CO.
• Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a watch repair business.
• After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.

• If you plan to purchase or build a location:
• You will be responsible for obtaining a valid CO from a local government authority.
• Review all building codes and zoning requirements for your business’ location to ensure your watch repair business will be in compliance and able to obtain a CO.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

The ideal watch repair shop owner loves watches. They also have a passion for clockmaking, watchmaking, and the history of watches. Watch repair shop owners are good with people, and they also honor the world of repair.

Because watch repair is very specific, general repairmen may not be fit for the watch repair business. Those who’re experienced with repairing small mechanical items, however, may find watch repair to be incredibly fun. Those who enjoy collecting watches and clocks, too, may enjoy the art of watch repair. As a business owner, a watch repair shop owner will need to have a good handle on management, accounting, and marketing.

What happens during a typical day at a watch repair business?

A watch repair shop owner will need to study the art of watch repair. They need to constantly make their skills better, learning about band repair, cork repair, face repair, and parts replacement.

They should also make their workspace incredibly efficient. A watch repair shop owner will need to catch loose watch pieces, organize their workspace, and organize their tools. Over time, a watch repair expert will invest in better screwdriver sets, part trays, and watch components.

Other responsibilities include attracting customers, extending services to new clients, offering well-priced repairs, and more. From a management perspective, a watch repair shop owner will need to collect payments, manage employees, offer competitive services, and market to the local community.

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

A modern watch repair shop owner needs to be an expert at repairing watches. Normally, this requires years of experience. Watch repair shop owners need to be able to dismantle, clean and reassemble watches quickly, safely, and effectively.

The best watch repair shop owners have at least 20 years of experience fixing watches. They will also understand the ins and outs of watch benches. As part of the daily job, a watch repair shop owner will need to source their parts. Having a good eye for watch part prices helps. Watch repair shop owners will also be effective business operators. They understand customers, are very personable, and know how to reach new markets.

What is the growth potential for a watch repair business?

Most watch repair shops are local. Some, in fact, only exist in shopping malls. A watch repair shop with a lot of success, however, can easily become a local hotspot for watch enthusiasts. For this to happen, though, the shop needs to offer amazing prices. It also needs to be effective with a variety of watch repairs. A watch repair shop which offers additional watch parts and cleaning services has a higher growth potential.

It’s possible to become a multi-state provider, but a lot of customers prefer local settings. E-commerce watch repair shops also exist. These shops receive watches by mail, repair themm and return them within a certain amount of time. If you want to expand, consider becoming a digital provider. It’s a lot cheaper than becoming a national provider, and it’s a very popular modern job.