Budget-Friendly Strategies for Running a Watch Trading Business

September 30, 2024

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When you decide that the watch trading business is something you want to do, there are a few ways to save money in both the short and long term.

There are several strategies to run a watch business more resourcefully, and luckily for you, here are some money-saving tips for running a watch trading business.

Here are the steps to achieving success in the watch trading business.

1Mastering the Art of Watch Trading

2Establishing a Strong Online Presence

3Setting Up an Online Store for Watch Dealers

4Forming an LLC for Your Watch Business

5Opening a Business Bank Account

6Securing Funding for Your Watch Business

7Safeguarding Your Watch Inventory

Mastering the Art of Watch Trading

There are many ways to learn how to trade luxury watches:

Connecting with people in the industry
Watching YouTube videos
Reading blogs and forums
Taking an online course

I started with an online course, Watch Trading Academy, where I learned from Pejman Ghadimi, an exceptional teacher who has taught thousands of students how to make money buying and selling watches.

Pejman Ghadimi personal Collection — Credit: Pejman Ghadimi

After that, I began researching watch trading further, learning about different watch brands through forums and YouTube to become an expert in the specific watches I planned to buy and sell.

Learning from Others’ Experiences in Watch Trading Can Be Invaluable observing how others trade can save you a lot of time and money, and it’s a great way to feel part of a supportive community.

The Best Resources to Learn Watch Trading on a Budget

Watch Forums: Check out forums like Watchuseek, Rolex Forums, and Omega Forums.
YouTube: Search for specific topics you want to learn more about; a wealth of information is free.
Watch Trading Academy: A comprehensive course and one of the best ways to learn the ins and outs of watch trading.
Jeweler and Watch Dealer Friends: First-hand experience and insights are invaluable.

Remember that not every resource is the best fit for everyone; everyone has their own learning style. By leveraging those already skilled in watch trading, you can save valuable time and improve your knowledge without spending money on ineffective methods. Instead, focus your resources on becoming a more effective watch trader.

Establishing a Strong Online Presence

When you decide to run your ownr luxury watch business, having an online presence is important. There are many cost-effective ways to establish this.

Start by choosing a consistent business name across all platforms and marketplaces. You want to ensure it’s easy for potential customers to find you when searching for your name.

Create accounts with the same name on the following platforms, even if you aren’t actively using them right away:

Facebook
Instagram
X (formerly known as Twitter)
LinkedIn
YouTube

You are free to join these social media channels. Below are the steps to set up your business accounts:

Facebook

To set up a business account on Facebook, follow the instructions here: Facebook Business Setup.

Instagram

To set up an Instagram business account:

Go to your profile and tap “Edit Profile.”
Tap “Switch to Professional Account.”
Tap “Continue.”
Select a category for your business and tap “Done.”
Select “Business” and tap “Next.”
Add your contact details and tap “Next.”
Connect your business account to a Facebook Page.
Complete any optional steps to set up your professional account fully.

Establishing a consistent and professional online presence will make it easier for customers to find and connect with your watch business.

https://www.youtube.com/c/ValueYourWatch

How to Set Up an X Business Account

Go to X.com/signup.
Click Sign Up.
Enter your name, phone number, or email address.
Verify your account.
Choose a username that best represents your business.
Customize your profile by adding a logo, header image, and bio.
Include your contact information, such as your website URL and location.
Choose a theme that aligns with your brand’s style.
Start tweeting by introducing your business or sharing interesting content.

https://www.linkedin.com/company/valueyourwatch/

How to Set Up a LinkedIn Business Account

Sign in to your personal LinkedIn profile.
Click the Work icon in the top-right corner.
Click Create a Company Page.
Select the type of page you want to create.
Enter your business details, such as name, logo, and description.
Check the verification box to confirm your authority to generate the page.
Click Create Page.
Click Start Building Your Page to customize it further.

How to Set Up a YouTube Business Account

If you already have a personal YouTube account, you can add a business account:

Click your profile icon in the top-right corner.
Above the “Sign Out” button, click Add Account.
Follow the prompts to create your business account.

All of these steps are free and provide a strong foundation for your watch business. You can use these platforms accordingly once you decide which direction to take. Some prefer reviewing watches on YouTube, others share tips on X, and many successfully sell watches on Instagram.

You build a solid and consistent brand presence by securing the same name across all mentioned social channels. As new social media platforms emerge, you can easily add them to your list.

Setting Up an Online Store for Watch Dealers

When you’re ready to take your watch trading to the next level, many dealers choose to have their website. Although this comes with expenses, there are more affordable ways to establish an online store without breaking the bank.

The advantage of owning a website is full control over its design and functionality. However, using platforms like eBay or Chrono24 might face restrictions and pay higher fees, impacting your profit margins.

Fortunately, there’s a platform that offers you the benefits of owning your store without the headaches of hosting, managing the website, or handling marketing.

Value Your Watch Marketplace allows you to create a store, gain followers, connect all your social channels, and sell watches without transaction fees. It’s like having your website but with much lower costs and none of the technical hassle.

The advantage of this marketplace is its built-in audience, attracting more buyers to your store—similar to having a store in a busy mall versus one in an isolated location. This saves you money and time when building your brand and business.

Forming an LLC for Your Watch Business

Setting up an LLC for watch trading is crucial. It not only provides legal protection but also enhances your business’s credibility. Each state has guidelines for creating an LLC; you must follow the steps outlined for your location.

Setting up an LLC for watch trading is a significant step towards your business success. It not only provides legal protection but also enhances your business’s credibility, giving you a sense of control and confidence. Each state has guidelines for creating an LLC; you must follow the steps outlined for your location.

When setting up an LLC, there are a few details to prepare.

For example, in Hawaii, you must select a business name for the LLC and file formation documents, known as Articles of Organization, with the Secretary of State or a similar state agency. While the required information varies by state, it generally includes the LLC’s name, address, business purpose, and registered agent’s details.

Once the necessary documents are completed, you’ll pay a filing fee—typically around $75—though this amount can differ depending on your state.

After forming your LLC, you must apply for an Employer Identification Number (EIN). This number is vital for opening a business bank account or applying for a loan, and it helps establish your LLC as a separate legal entity.

Applying for an EIN

You can apply for an EIN through the IRS website; however, be mindful of their operational hours: Monday through Friday, 7 a.m. to 10 p.m. Eastern Standard Time. If you try to access the site outside of these hours, you might see the following message:

“Our online assistant is currently unavailable. We apologize for the inconvenience. Please try again at a later time. You may have accessed the Online EIN Assistant outside the hours of operation. The hours of operation are posted here.”

After setting up the LLC, you’re on the right path to take full advantage of owning a business. Consult an accountant or bookkeeper to ensure your financial records are kept properly.

Now that your business is established, the next step is to open a business bank account.

Opening a Business Bank Account

When opening a business account, you’ll need to provide the following documents:

Personal ID
Business License
Tax ID (EIN Number)
Legal Incorporation Documents
Initial Deposit

Occasionally, banks might ask about the nature of your watch trading business. If you describe your activity as buying and selling watches, it may appear slightly risky to them. However, presenting yourself as an “advisor for luxury assets” may reduce potential red flags and make you seem less dangerous in their view.

There are many options when choosing a bank to open your business account. I prefer credit unions because of their shared branch capabilities; you can go to any participating credit union within the shared branch network to deposit or withdraw money. Additionally, fees for services like wire transfers or incoming wires are generally less expensive at credit unions than at national banks.

Securing Funding for Your Watch Business

This stage requires taking calculated risks, as you can borrow money at 0% interest—but you’ll need to pay it back before the interest rate kicks in.

Best Places to Borrow Interest-Free:

PayPal Credit: Offers a line of credit up to $10,000. You must pay off the balance within six months or be subject to high interest rates.
New Credit Cards: Look for credit cards with introductory 0% interest rates for up to 15 months. It’s essential to research online for options that best fit your needs.

My Favorite Credit Cards to Leverage Bank Funds:

Chase Ink – Offers an attractive introductory rate of 0% for 12 months.
Blue Business Credit Card – Provides a 0% introductory rate, great for getting started.

These cards offer introductory rates that can help you kickstart your watch business.

Other Ways to Leverage Funding:

Whole Life Cash Value Insurance or HELOC: You can also use cash value from whole life insurance policies or a home equity line of credit (HELOC) from your property. Luxury watch assets rarely lose all their value, so the key is to buy wisely and keep inventory moving. However, be cautious of trending watches, as their value can fluctuate significantly over a short period.

Safeguarding Your Watch Inventory

As your inventory grows to thousands of dollars worth of watches, it’s wise to secure your assets by moving the watches out of your home or making certain adjustments to how you manage your business.

Steps to Protect Your Assets:

Shipping Labels: Avoid using your home address for return labels. Instead, use a FedEx or UPS office as the return address.
Wire Transfers: Your wire information should not include your home address; use an alternative address for added security. Here are other payments methods you might want to learn about.
Shipping Insurance: Use services like IFS or ParcelPro to insure your shipments. Without proper insurance coverage, you don’t want to risk losing a $20,000 watch during transit.

Additional safety steps include getting jeweler insurance or storing the watches safely in the bank. You never know when someone wants to visit you.

All the steps mentioned in this blog post come from personal experience and might benefit you as well. Keep in mind, the more knowledge you gain, the better you’ll become.

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