What makes Rolex watches so expensive

Established in 1905, Rolex is known globally as the biggest Swiss luxury watchmaker.

The company produces about 700,000 watches each year, or roughly about 2,000 per day. On first look, this may seems like a decent number, but that only represents about 2% of all Swiss watches sold annually.

A Rolex watch is expensive to own. With that kind of money, one can easily buy the next 6 versions of the iPhone and still have some money left.

Since Rolex is a privately held company own by a trust set up by its late founder, there is no public information with regards to its financial figures. That said, an extensive search online have most people pegging the product cost of a Rolex watch to be between S$750 to S$1,000. This is of course at best, an educated guess.

If between S$750 to S$1,000 feels a little high to produce a watch compared to the S$3 watch one can manufacture in China, it’s worth noting some aspects of Rolex watch that makes it intrinsically more valuable.

For starters, each Rolex watch is carefully created with the kind of precision you expect from a Swiss watchmaker. These include the type of steel used, the technology that the company introduce, adopt and innovate and of course, the human touch and obsession to quality it takes pride in. All these takes time, skills, resources and of course, money.

Rolex watches are produced entirely in Switzerland. With Switzerland being one of the world most expensive countries to do business in, cost is naturally high. It’s nevertheless the stringent standards that the company has adopted which allows it to charge a premium for its watches, and why buyers are still happy to pay for it.

Similar to other luxury goods like designer bags, jewellery, supercars and high-end fashion brands, Rolex is able to charge its customers more because of the brand it has built up over the past decades.