I thought about it some more and maybe it could be, especially at the medium end. I dont think the original idea works because you have a lot of inventory/depreciation costs but if you modify it a bit it could.

People who love watches have lots of them laying around doing absolutely nothing, why not set up a service where people can rent out their own watches. You can take a cut off every transaction as a service fee think VRBO of watches.

The fees should be low of the individual transactions but the profit center should be services. For a set fee KB will catalogue your watch, photograph it and check for defect, then send it out to the customer. At the end of the transaction the renter will send you the watch back and you will once again catalogue it and check for damages and offer up repair services as needed (at reasonable but slightly high prices), maybe for an additional fee you could even store it (Amazon warehouse model). You should also offer some additional high profit fluff services like cleaning/polish/band adjustments etc.

Additionally you offer some sort of service where the renter can buy the watch, that might provide some social cover for the "I'm just renting it" problem.

You could could have site credits as well, to reduce your credit card fees, and because expired/lost credits are another great profit center, plus it can provide you additional cash buffer.

Your main costs will be the website and the fraud. I think you could probably contain the fraud since you will be inspecting the watches but the website costs might be unreasonably high.

This also solves the problem thelurkerawakens had as you don't hold the watch in inventory and if it dies you collect additional profit for repairs