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Local watchmaker quoted $400 service fee. Reasonable?

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In my small town there is really only one independent watchmaker. I recently had a chat with him about service costs and he quoted me $400 for my Hamilton khaki king day date, and $450 for my Longines chrono. The fee makes some sense for the Longines, but the problem is that I can buy a new Hamilton for $340 GM. I've got at least a couple years yet before it would need servicing, so I'm ok for now but...

Is this what servicing fees are or are there more affordable options out there? If that is the fee, how do you justify spending more on servicing than you did on the watch? Or do people just buy a new one when the old one's performance starts to diminish?

Looking for feedback, especially from the guys/gals that have 15-20 watches all in this general price range.

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