How to start a watch business

Tap into the demand for fashion accessories by opening a watch company.

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If you like collecting watches, have you considered making it a business? Watches remain a popular fashion accessory and with the growth of online shopping sites, you could find a global market for your designs. Read on to see what you need to start a watch business.

What is a watch business?

A watch business sources timepieces and resells them online. In essence, you are creating a brand around a fashion accessory.

Skills needed to start a watch business

As watches are more than about telling the time, an eye for watch designs and trends is essential. You will want to identify your niche market, the types of watches you intend to sell and where to source the watches. Watch types include mechanical, quartz and digital watches. You need to know the language of watches and describe these details to potential customers. Important technical terms are bezel, crown, crystal, dial, lugs, movement and signature.

If you intend to take vintage watches and fix them to upsell at a higher cost, you will also need watch repairing skills.

Aside from knowledge about watch designs, you will also need entrepreneurial skills to run the business, including marketing, budgeting, administration, sales and management skills.

man looking at watches

Courses and qualifications

There are no specific qualifications needed to start a watch business from home. However, there are plenty of online resources to perfect your small business skills and avoid costly errors down the track.

Udemy is an online course platform with thousands of courses on a variety of topics. It offers courses on ecommerce, marketing, how to sell luxury items and how to create a watch brand.

Using social media and photography skills are essential for most online watch businesses. Online photography courses can help you improve your skills and create a watch brand that targets a niche market.

If you do not have experience in running a business, you can study a business course online to learn the fundamentals.

Compare business courses online

Name Product How many courses are available? Are free courses offered? Are accredited courses available?
Training.com.au - Business
Training.com.au - Business
1,100+
No
Yes
Online Courses Australia - Business
Online Courses Australia - Business
80
No
Yes
TafeCourses.com.au - Business
TafeCourses.com.au - Business
840+
No
Yes
MasterClass - Business
MasterClass - Business
100+
No
No
Udemy - Business
Udemy - Business
100,000+
Yes
Yes
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Buy the right equipment and software

Online watch sellers can depend heavily on social media to display a lifestyle associated with their watches. You may choose to take your own photos with a professional camera and photo editing software. An easier route is to hire a photographer and model through freelancer sites such as Airtasker.

To run your business, you will need a computer and software that will allow you to keep track of inventory, invoices, expenses and marketing. If you decide to set up a website to promote your business, you will need a domain name and web hosting package, or you may choose to hire a web designer to handle it for you.

To repair vintage watches to sell on, you will need a repair kit that contains specialist tools like a magnifying loupe, movement holder and watch components.

Choose a business structure

To register your business, you need to choose the most appropriate legal structure for your business model. For a watch business, you are likely to operate as either a Sole Trader or Partnership.

Sole Trader

If you will be the only person in the business, you can register as a Sole Trader. You will be entirely responsible for taxes, debt and losses. It's one of the simplest business models to set up and manage.

Partnership

If you will be running the business with another person, you might consider registering as a Partnership. This divides the responsibilities, assets and liabilities of the business between you.

Once you have decided on the business structure, you need to:

  • Come up with a memorable name for your watch brand.
  • Register for an Australian Business Number (ABN), which identifies the business with government agencies for tax and administrative purposes.

Company

A Company is its own legal entity and is owned by up to 50 non-employee shareholders. Being set up as a Company offers some protection from personal liability. The Company is liable for its obligations and will be taxed at corporate rates.

While starting a new business is exciting, before you get stuck in you should make sure you have the necessary legal documents in place. These will protect the business in case there are problems in the future.

Some of the documents you may want to organise include:

  • Co-founder Agreement. If you are starting the business with other people, a written Co-founder Agreement will provide a framework for you to refer to. It covers ownership, roles and responsibilities.
  • Wholesale Agreement. You will likely purchase watches from your suppliers on a wholesale basis and you may also want to sell your watches on a wholesale basis to buyers. A Wholesale Agreement protects your business when engaging in this.
  • Shipping Policy. By including a Shipping Policy on your website you can inform customers about shipping methods and prices, and protect the business from disputes.

You can find a range of legal document templates online for free or a small charge that you can download and customise to your needs.

Access legal services and documents online

Name Product What's offered? Starting price to become a member Annual Fee from Free legal documents available?
Lawpath
Legal documents and templates, Access to lawyers, Legal guides, Legal advice
$79 per month
Essentials: $288, legal advice: $828
You can view samples for free and you can create your first document for free.
Choose an annual plan from just $288 and get unlimited revisions to your legal or business documents. Plus, unlock exclusive partner offers.
LawDepot
Legal documents and templates, Legal guides
$4.99 per month
$59.88
Free one week trial available which gives access to hundreds of documents.
Customise and download legal documents in as little as five minutes. Plus, LawDepot offers peace of mind with two service guarantees.
Legal123
Legal documents and templates, Legal guides
Varies per template
N/A
No
Legal123 offers a range of individual templates or document packages for consultants, app developers, personal trainers and more.
LegalVision
Legal documents and templates, Legal guides, Legal advice
$49 + GST per week
$2,548 + GST
No
Your business can take advantage of unlimited lawyer consultations, fast turnaround times and free legal templates with LegalVision.
Law Central
Legal documents and templates, Legal guides
Free for the Silver membership
Gold: $99
You can view samples and create your own document for free with the Silver membership.
Law Central offers a large number of legal templates for super, trusts, estate planning, employment and commercial uses.
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Marketing to get more customers

Some useful techniques to attract new customers to your watch business include:

  • Brand story. As watches are considered a fashion accessory, marketing your watches with a strong brand story and aspirational content will attract consumers.
  • Digital marketing. Making use of web content, social media, online marketplaces and paid advertising will open up a global audience for your products.
  • Email list. Email marketing is also an effective online sales method. Build an email list and offer subscribers exclusive sales and discounts to generate sales and keep customers coming back.
  • Loyalty programs. Offering loyalty programs and referral discounts is another way to expand your sales through existing customers.

How much to charge customers

The pricing for your watches will depend on your target market, as well as the cost and quality of the components you use. Prices for watches can range from $50 into the thousands of dollars.

Start by researching your target customer and what they are likely to pay for your products. Look at the prices your potential competitors charge for similar watches.

Some pricing strategies include:

  • Keystone pricing. Calculate the retail price by doubling the wholesale price. If you have rare watches or absorb the cost of delivery, it will make more financial sense to charge slightly more than double.
  • Loss-leading pricing. As a new watch brand, slashing the price of one or more watch models to attract customers can make a smart marketing strategy.
  • Premium pricing. Although you might undercut your competitors when pricing your watches, this can backfire for a luxury watch brand. If you focus on the lifestyle and added value attached to your brand, customers will hopefully perceive a higher cost as premium quality.
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Accept payments from your customers in person and online with Square's card readers, payment terminals, digital invoicing and e-commerce tools.

Frequently asked questions

Can I start a watch business with limited capital?

Yes, you can start with limited inventory at the beginning and scale up as you make more sales. Setting up your website yourself and starting with free marketing methods, such as social media rather than paid advertisements, will allow you to open the business with a small budget.

What consumer law do I need to be aware of?

As you will be selling goods to consumers, you need to be aware of your responsibilities as a seller under consumer protection law. For example, Australian Consumer Law (ACL) includes:

  • Consumer guarantees and reimbursement
  • Product safety enforcement
  • Privacy policies
  • Penalties

Products must be:

  • Of acceptable quality
  • Match advertising and packaging descriptions
  • Be safe
  • Fit for purpose
  • Without faults

What insurance do I need for a watch business?

It is important to obtain insurance to protect your business from unexpected events. You will want to have in place:

  • General Business Liability Insurance
  • Insurance that covers your inventory of watches and components.
  • Workers compensation insurance in case of a work-related accident or illness – this is needed if you hire employees for your business.
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