You can't tell consumers the raw manufacturing cost because people act weird when they are told it: they usually assume the "markup" is profits. They assume that they're getting ripped off because most people don't understand development costs or overheads and they always argue that any profit is too much. This problem can't be fixed.

Apart from the risk of scammers buying a watch to sell, saying it is broken, getting a replacement at cost and the scammer steals the markup/profit.

You can maybe think of ways to make it work, but they are likely to have excessive support costs or other hidden costs for the manufacturer or consumer.

It is so weird we talk about caring about an invisible variable that is actually irrelevant.

In theory we should only look at the price and judge whether our expected benefits are likely to exceed that price. And we get distracted by measuring things in $, when what really matters is our benefits which can't be measured in $.

We are also distracted by ideals of fairness (a foolish goal in a business transaction) and zero-sum thinking (am I getting ripped off?)

I don't mind spending money on quality. What I hate is the information gap, and the costs of having to learn how to judge quality myself (because price is no proxy measure). I am distrustful of so many biased signals, plus so many other people's opinions are either unhelpful or influenced.

Mostly we each just fall back on an A versus B heuristic. I find it absolutely mad that the world works at all.

And an answer: look at the bad buying decisions made by others, and learn from their mistakes. I watch my father with money to spare, he wastes 2 hours to save $1, or he avoids spending money on something that would benefit his life or the life of someone he cares for, or he won't buy a Toyota because he hated their adverts once, or he keeps buying a Nissan even after being burnt by a severe costly design flaw.

1. what percentage of this object price is net profit? 2. is that percentage a "fair" proportion?

but atm, I don't have a "scientific" way to respond to those questions so I usually go with my gut, or do whatever other people in my circle do (which is not ideal and I'd like to change)

You only know the actual profit margins much later, after you have sold the devices and seen them last through their warranty period.

If you'd like to minimize excess profit, take note of which products seem overpriced compared to their peers. Traditionally, anything Apple makes is a prime example. For a non-tech example, look at disposable alkaline batteries. Rayovac has been owned by Energizer since 2018 and their batteries have become increasingly comparable over time, yet Rayovac batteries are much less expensive than comparable Energizer batteries. The difference? Mostly marketing and profit margin, at this point.