How much worth are Gens and Reps if you removed all Trademarks

[BuyersRemorse]

I was just curious how high the difference is between Gens and Reps, if they all had no Trademark on it.

Meaning i would like to compare just the Materials, Movement Quality, etc.

Are there huge differences between Gens and Reps? (Is a Gen PAM worth that much more than a Rep if these two watches were from a NoName supplier - What about other Reps)?

Is the GEN Price really justified? Or are even the Reps overcharges.

What are your thoughts.

[Nanuq]

I read something once that I just can't disagree with:

"Rolex: the world's most expensive $500 watch"

[chiman12]

Tough to call, I bet 75% of the cost of building a watch is labor...

[Nanuq]

Dunno about that. This one was $275 brand new in 1971.

And, it was hand-built by Wilsdorf's elves

[freddy333]

"Rolex: the world's most expensive $500 watch"

While I cannot totally disagree with that statement, to be fair, I think 1 also needs to take into account the development work Rolex does on materials & technologies, all of which costs alot & which must go into the price of each watch. I can only imagine how much it cost to develop the materials/processes that went into creating the ceramic bezel or the parachrom hairspring or the 4130 calibre, etc. Just saying.

[PeteM]

As well as the trademark you need to factor in or out depending which way your looking at it...

Marketing

Research and development

Overheads and profit

Distribution

After sales, customer services, warranty etc

Its not just the brand name, even the materials arent comparable in the main eg Rolex use 904L steel not 316 etc etc

Neither is the labour comparable in a lot of its production

Looks like I was typing as you submitted Freddy !!

[Nanuq]

Hey, those elves have unionized now, and they're demanding the BIG wages. Don't mess with the elves or Bubba Elf will pay you a visit.

[chiman12]

Let's put it this way...I still have my fathers 1968 DateJust with the original invoice...$1500HK, he mentioned that he had to save several months to buy it...so back then, labor would have been cheaper...plus look at the prices of VC, glashutte, etc. which are all pretty much decorated and assembled by hand...yes...R&D has a play into the price, but it is not as much as people think, especially when the design needs only slight modifications by CAD to make it into a different model...

I agree that marketing might take a big chuck of the pie...

Edit...

Alright 75% maybe high for labor costs, but at least 40% I would think...

Edited October 14, 2010 by ChiMan12

[TeeJay]

Interesting discussion

I think if all brandings were to be removed, and the gen and rep compared to each other purely 'as watches', then the gen would benefit from higher grade materials in construction, which would make the piece more costly, but, I would question whether that made the watch itself more valuable, simply because the difference in material, are largely laboratory observable only, and at the end of the day, a water resistant SS watch, is still a water resistant SS watch, regardless of the grade SS used... Without any branding, it would be interesting to see how much a consumer would be prepared to pay for the watch with the higher grade materials

[Nanuq]

We had this same discussion a few years ago, and someone posted a reference showing that some Asian manufacturers were mass-producing nearly complete "Swiss" movements for upscale brands. Those movements were sent to Switzerland for "final assembly" which gave them the right to call them "Swiss" movements.

IIRC, someone wondered out loud whether those same Asian factories were producing some of the higher quality rep movements.

I came *that* close to mentioning that "Over There" where the Doxaholics meet. Can you imagine how the mods would have scrambled for the BAN button?

[KB]

I think TJ hit on the topic a bit better than anyone else here.

To me the question was...'remove all branding and lay a rep and gen down beside each other'

This means all production, advertising, delivery and after sales cost are irrelevant.

In the end the gen will still be the better watch and the one actually worth more but it will be a lot closer than the true price tags suggest.

Ken

[BuyersRemorse]

To me the question was...'remove all branding and lay a rep and gen down beside each other'

Exactly. All that is irrelevant.

Yes ... a Rolex Movement is Better (more Jewels) than an ETA one, so the Rollie will be worth more.

But what with Breitling Watches ... all they use are simple ETAs right? What would make them more expensive than the rep? Same Steel, same Movement, maybe not that good Waterproofed but hey ... <---- that was my point :-)

[subbiesrock]

I've been doing a lot of reading (including outside of this forum) because the subject matter of rep and gen watches and the inherent value of reps and gens fascinates mr from a philosophical perspective. The quality of a gen would undoubtedly be better overall, I don't think that issue is in dispute, but the question is 'how much better'... I would say it's mainly the movement that distinguishes the two (not including functionless 21j movements that don't correctly operate like the gen, but actual clone movements that replicate the operation an in most cases the functionality of yhe original, such as th A7750 and 28xx clones etc to name just the most obvious) With all the interesting posts on the level of finishing doe in china, with final assembly in Swiss to be able to stamp the movement, that is frankly the clincher. I would say that the products with slightly finished ETA movements (Breitling pre B01, Longines, Omega etc) are inherently worth less that the hand finished masterpieces from the hand-finished wonders from VC, Patek etc.

If we consider the case, I would say the level of machining sophistication that the Asian factories have is almost (but not quite) on par with the German CNC machines the Swiss use. I've gathered that tolerance issues when creating reps are not the fault of lack of tolerance in machining, but laziness from the factories. Though, to be fair, some pics of the latest super reps has shown that they are definitely pulling up their socks in this area.

A wise man once told me the 'Golden Rule' of product cost breakdowns. He said that, in most cases, for western-produced items the costs were almost always 33% labour, 33% production materials and 33% overheads. Incredibly, though you might think different industries skew this value, most industries creating a tangible product for sale need people to design it, male it and market it. This applies to Rolex, but not to Rolex clones. For Asian makers, they don't advertise, as Rolex does that for them (;o)) and labour costs are lower than in Western countries. So in a clone, you ate really only paying for tooling costs for the machines for the factory, the movements are sub US100 for the most expensive Chronos and a Swiss 6497 can be had for peanuts at Retail, so you know they're cheap to make at wholesale, there's a small wholesale profit to the dealers and then they put on their 20-30% which is fair enough.

Considering the fact the Asian movements are not as well finished, often not waterproofed to the same levels or in some cases not even functionally equivalent, it's ceasy to make the mistake than most people make and say they're not worth as much... But it's comparing apples to oranges. Speaking about the ETA-powered sector, they took about the same time to build (shorter with the asian cases and movts with less QC) and about the same amount of effort went into making each one. They both take a similar time and effort - the Swiss just did it properly the first time ;o)

I would say that Frankens represent (ironically enough) the MOST value for money. They are heavily QCed and remachined by their obsessive owners (the finger is squarely pointed at the Paneristi of the forum) who obsess and discuss the various thicknesses of CGs and the level of concavity of their crowns to within micron tolerances. Gen dials and hands (and in some cases, movements such as Concepta's wonderful Portos) are added and the end result is usually twice to three times the price of a rep factory item, but still only 10-20% of retail and at 98% accuracy. Cost/Benefit seems highest for frankens, which is why we see so many on the boards being made and traded. Plus it's fun )

It's been interesting to read the various perspectives on this issue, fascinating topic.

[maxman]

I think TJ hit on the topic a bit better than anyone else here.

To me the question was...'remove all branding and lay a rep and gen down beside each other'

This means all production, advertising, delivery and after sales cost are irrelevant.

In the end the gen will still be the better watch and the one actually worth more but it will be a lot closer than the true price tags suggest.

Ken

I agree 100% Ken. I say take it one step further and service the rep movement or better yet put In a fresh eta. A top notch rep with a top notch movement Is going to be lot closer than many might realize. The price difference of course Is staggering. I think thats why we are all here,I know thats why Im here

[TeeJay]

I've been doing a lot of reading (including outside of this forum) because the subject matter of rep and gen watches and the inherent value of reps and gens fascinates mr from a philosophical perspective. The quality of a gen would undoubtedly be better overall, I don't think that issue is in dispute, but the question is 'how much better'... I would say it's mainly the movement that distinguishes the two (not including functionless 21j movements that don't correctly operate like the gen, but actual clone movements that replicate the operation an in most cases the functionality of yhe original, such as th A7750 and 28xx clones etc to name just the most obvious) With all the interesting posts on the level of finishing doe in china, with final assembly in Swiss to be able to stamp the movement, that is frankly the clincher. I would say that the products with slightly finished ETA movements (Breitling pre B01, Longines, Omega etc) are inherently worth less that the hand finished masterpieces from the hand-finished wonders from VC, Patek etc.

If we consider the case, I would say the level of machining sophistication that the Asian factories have is almost (but not quite) on par with the German CNC machines the Swiss use. I've gathered that tolerance issues when creating reps are not the fault of lack of tolerance in machining, but laziness from the factories. Though, to be fair, some pics of the latest super reps has shown that they are definitely pulling up their socks in this area.

A wise man once told me the 'Golden Rule' of product cost breakdowns. He said that, in most cases, for western-produced items the costs were almost always 33% labour, 33% production materials and 33% overheads. Incredibly, though you might think different industries skew this value, most industries creating a tangible product for sale need people to design it, male it and market it. This applies to Rolex, but not to Rolex clones. For Asian makers, they don't advertise, as Rolex does that for them (;o)) and labour costs are lower than in Western countries. So in a clone, you ate really only paying for tooling costs for the machines for the factory, the movements are sub US100 for the most expensive Chronos and a Swiss 6497 can be had for peanuts at Retail, so you know they're cheap to make at wholesale, there's a small wholesale profit to the dealers and then they put on their 20-30% which is fair enough.

Considering the fact the Asian movements are not as well finished, often not waterproofed to the same levels or in some cases not even functionally equivalent, it's ceasy to make the mistake than most people make and say they're not worth as much... But it's comparing apples to oranges. Speaking about the ETA-powered sector, they took about the same time to build (shorter with the asian cases and movts with less QC) and about the same amount of effort went into making each one. They both take a similar time and effort - the Swiss just did it properly the first time ;o)

I would say that Frankens represent (ironically enough) the MOST value for money. They are heavily QCed and remachined by their obsessive owners (the finger is squarely pointed at the Paneristi of the forum) who obsess and discuss the various thicknesses of CGs and the level of concavity of their crowns to within micron tolerances. Gen dials and hands (and in some cases, movements such as Concepta's wonderful Portos) are added and the end result is usually twice to three times the price of a rep factory item, but still only 10-20% of retail and at 98% accuracy. Cost/Benefit seems highest for frankens, which is why we see so many on the boards being made and traded. Plus it's fun )

It's been interesting to read the various perspectives on this issue, fascinating topic.

You touch on the subject of waterproofing a few times... Now I will admit, I have not had any of my watches professionally pressure tested, and I have received one watch from the dealer which leaked (the replacement did not). However, other than that, I have never had an issue with the level of water-proofing of my watches... They've been bathed/showered/swum in, all without issue. It's been said that micro-breaches in the case seals will actually close up under high pressure, so it's actually under low pressure immersions (as detailed above) that a watch is more likely to flood or fog up. With many watches, particularly the diver's watches, the very nature of the design and construction of the watches makes them water-resistant, with flooding issues down to manufacturer's flaws (which can occur in all branded mainstream items, hence why companies carry warranty) I would be the first to admit, that the a21j movement in my sub is not as nicely finished, or with as exotic materials as the movement in a gen Rolex Sub, but, it still runs at +0.5 seconds over 24 hours, so what would the added cost of the higher grade materials actually get me for my money, especially if the case surrounding the movement is identical? (as when dealers supply a watch with both Asian or Swiss movement options, and the movement being the only difference) Longevity of performance, perhaps? Well, given the cost of asian movements it's as cheap to replace them as to repair them, and of course, even the gen movements still need periodic servicing, so that kind of longevity, we're talking about in decades, rather than months and years, so to be honest, not an immediate concern

[Prsist]

As well as the trademark you need to factor in or out depending which way your looking at it...

Marketing

Research and development

Overheads and profit

Distribution

After sales, customer services, warranty etc

Its not just the brand name, even the materials arent comparable in the main eg Rolex use 904L steel not 316 etc etc

Neither is the labour comparable in a lot of its production

Looks like I was typing as you submitted Freddy !!

I forget where I read it but it used a $1k watch (cost of production and parts) and showed how it can become a $5k watch. Interesting read, now where did I put it?

[Drulee]

I started a related topic a few days back, as I was considering the purchase of a gen Panerai. But after going over the responses, and trying the gen on at the AD, then borrowing a friends for a weekend, I just couldn't justify the purchase. Of course, in my case, I'm referring mainly to manual wind Panerai models, plus an auto 7750 powered few.

[By-Tor]

Lots of text... I'm very busy right now so I couldn't read them all fully, but I think the thing what differentiates reps and gens is not only the movement, it's everything.

But that "everything" is something that you can only appreciate when you become a real "WIS". Actually I hate that abbreviation, because it sounds so snobbish.

Bracelet and SEL details, how the crown winds in/out, clasp smoothness, dial glossiness, etc. Reps can never make those things right, but these are very hardcore details. If you wanted to explain those to an outsider, he would never understand.

I don't know where's the limit between sanity and insanity, but being a watch fanatic moves you close to those borders. For someone "normal" that kind of details would never make any sense.

People who say "Rolex is a nice $500 watch" forget that they're actually very high quality watches, and they have inhouse movements. Rolex is a dirt cheap poor man's watch compared to Breguet, Zenith, Patek and JLC. How many other brands offer 100% inhouse movements for the same price? (Seiko doesn't count as it's competing in totally different league.)

[subbiesrock]

People who say "Rolex is a nice $500 watch" forget that they're actually very high quality watches, and they have inhouse movements. Rolex is a dirt cheap poor man's watch compared to Breguet, Zenith, Patek and JLC. How many other brands offer 100% inhouse movements for the same price? (Seiko doesn't count as it's competing in totally different league.)

You forgot Vacheron, probably the second of the big two premier Swiss watchmaking firms, but I digress

I was watching an interview with Patek's Chief of Marketing and he mentioned they move about 40,000 units/year. The cheapest PP watch is a Quartz and values at US15K. So if all they sold was 15K quartz models (which of course they don't), the annual PP turnover is US600M... Over half a billion smackers for a tiny little watch company in a nondescript valley in Switzerland. If an average Rolex is say 5K (again they sell everything from steel Subs to full gold diamond encrusted Presidentials) they would have to move at the very least 10 times what PP does. So you're looking at a cool 1 Billion turnover. I would say there's a nice profit margin at Rolex )

I know it's a little off-topic, but it really puts economies of scale into perspective, I never knew what the approximate numbers were before...

In terms of reps and gens, the quality comparison is up to the individual. Concepta's IWCs, BK Subs and the myriad modders here and on other forums do what they do to bring the reps towards the gens they emulate, precisely because the small differences are what drives people to perfection.

[iceberg1459]

these watches are luxury goods, worth is determined by its value consist many things, and trademark is big part of the value, no matter how good a fake can look, its practically worthless because its a copy

[TeeJay]

these watches are luxury goods, worth is determined by its value consist many things, and trademark is big part of the value, no matter how good a fake can look, its practically worthless because its a copy

And yet that's the crazy/fun part of this hobby... When I sold off my original watch collection, it paid for a big chunk of my wedding, that's not 'worthless', but a quantifiable cash price I would suggest that the perception is what makes something valuable/worthless. For example, the guy who had a Sub for ten years thinking it was gen, only to send it off for service to be told it was a rep... How might that watch's value have been percieved prior to the revelation? Would people have thought it was an expensive watch? Would the guy have thought it was a worthless piece of crap once he found out it was fake? All that would have changed, was his perception of the watch, the watch itself, remained the same... I agree, these watches are luxury goods, but, adding the word 'luxury' to something, while it make an item desirable, it does not automatically make it valuable. A gen Sub is simply not worth the $$ price Rolex puts on the price tag. Even our reps aren't worth the price tag the dealers assign them. What we're paying for, as you say, is the brandname, the trademark, or in this specific instance, the 'skill of the forger' to create a (near) identical copy of the coveted original

[andreww]

In terms of what it actually "costs" to build these watches, i'd guess our reps cost about half of what they are sold for. Meaning a $300 watch costs about $150 to build. Now so long as we are talking about non-inhouse movement watches like Breits, Tags, Omega, etc., I would expect their actual value to be 3 to 4 times that of the rep, meaning if the rep was produced for $150, the gen would likely cost no more than $600. The thing that would be the biggest difference in the two would obviously be the movement, as the ETA (7750) would cost at the very least $200, while the Asian version would be well under $100. Costs to produce the other parts would be similar however. So bottom line is movement costs and labor are more expensive on the gen.

[TeeJay]

In terms of what it actually "costs" to build these watches, i'd guess our reps cost about half of what they are sold for. Meaning a $300 watch costs about $150 to build. Now so long as we are talking about non-inhouse movement watches like Breits, Tags, Omega, etc., I would expect their actual value to be 3 to 4 times that of the rep, meaning if the rep was produced for $150, the gen would likely cost no more than $600. The thing that would be the biggest difference in the two would obviously be the movement, as the ETA (7750) would cost at the very least $200, while the Asian version would be well under $100. Costs to produce the other parts would be similar however. So bottom line is movement costs and labor are more expensive on the gen.

I agree, absolutely. Higher quality grade metals and other materials, so indeed, higher production costs, and a justifiable reason to charge more. However, other than a slightly different hue and shine, the difference between the SS of a gen 16610 and a rep 16610 is something which can only be detected by either a true WIS, or a scientific destruction test, it's not something that the average watch-wearing Joe Sixpack is going to notice, let alone appreciate. This was why I wondered above, as to if that average guy on the street would be prepared to pay a little extra for the watch made from the higher quality materials, if there was no brand name involved, as they're less likely to appreciate an 'invisible' quality

On another matter, good to see you posting, I hope life's been treating you well

[andreww]

I agree, absolutely. Higher quality grade metals and other materials, so indeed, higher production costs, and a justifiable reason to charge more. However, other than a slightly different hue and shine, the difference between the SS of a gen 16610 and a rep 16610 is something which can only be detected by either a true WIS, or a scientific destruction test, it's not something that the average watch-wearing Joe Sixpack is going to notice, let alone appreciate. This was why I wondered above, as to if that average guy on the street would be prepared to pay a little extra for the watch made from the higher quality materials, if there was no brand name involved, as they're less likely to appreciate an 'invisible' quality

On another matter, good to see you posting, I hope life's been treating you well

If you take away the obviously higher labour rate and account for ETA's markup, the actual cost to produce would be the same. After all, the watches to go through the same basic processes. We all know the chinese cut corners however, and that our rep movements rarely come oiled or clean. That all costs money.

These are luxury items though, and you are not paying for the watch as much as you are paying for the brand and all the air racing teams, movie stars, athletes, etc. that they pay millions upon millions of dollars to endorse their products. Setting a watch price has very little to do with actual value, but much more to do with targeting an audience that has the money to pay for a perceived exclusivity.

And life has been treating me well Teej, just been a little to busy with life lately

[freddy333]

But that "everything" is something that you can only appreciate when you become a real "WIS". Actually I hate that abbreviation, because it sounds so snobbish.

That is kind of funny because the term, WIS, was never intended as a snobbish descriptor of serious collectors. Instead, it was meant as a self-effacing joke on those of us who take this hobby a bit too seriously (endlessly neurosing over & debating details, which make little difference in the vast scheme of things, that can usually only be seen by way of a magnifying glass ).