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Size vs. Cost - Page 3

post #31 of 46
Quote:
Originally Posted by bubbleboys View Post

These are a few reasons why that $400 sweater costs more than that $100
  • Craftsmanship (I have no idea what pilling is, but I suspect it has something to do with needing more skill to sew or use a more intricate and involved sewing method)
    If it takes more time, you pay extra. If it takes more skill, you pay extra.
  • Small overall quantities being manufactured (people usually go into business to make money, while the high quality sweater may only cost an extra $50 to make, they may need to charge an extra $300 to make a comparable profit)
    100,000 JC Penney sweaters manufactured x $50 profit each = $5,000,000 of profit
    1,000 High end sweaters manufactured x $300 profit each = $300,000 profit
    If they sold the high end sweater at $50 profit each, the business owners would only make a measly $50,000 (which really is chump change when you get into any sort of manufacturing)
  • The company's motto is selling luxury. Luxury is inherently linked to the price you pay for goods and also the rarity of said good. If Lamborghinis were suddenly to start selling for say $40,000, people would probably start thinking it wasn't a super luxury vehicle. If I can find this business case study, I'll post it up for those interested; it's about BMW and how they are starting to lose their previous "luxury" status. Long story short, BMW has had a hell of a time maintaining their luxury status with the very success of their company and their products, namely the 3 series. Every Tom, Dick, and Harry has a BMW 3 series car to the point where their status as a luxury car is really in question.
Ultimately, the $400 sweater costs $400 because that is the market price for that particular product. There are enough people out there who will buy a $400 sweater because SF approves of it, as a status symbol, etc. or even just because they have the money.
The beauty of a free market is that if you feel that $400 for a non-pilling sweater made with the finest cashmere is way too much money, then start up a company and sell that $400 sweater for $200, or even less.
I'm sure what you'll find is that you either won't be able to make a healthy profit off the sweaters, you'll have difficulty selling it as a high quality item/luxury, or you'll simply start feeling you should be paid more for your hard work and thus the price will raise.
PS This wasn't a long explanation; I could easily write a 10 page analysis on why a $400 sweater costs that much without even needing to rely on any sources and just using logical business concepts, some of which I've described.

except lamborghinis cost hundreds of thousands to make
post #32 of 46
Quote:
Originally Posted by sns23 View Post

except lamborghinis cost hundreds of thousands to make

All right, fine I will spell it out since I didn't do so in my original response.

All numbers are placeholders.
They aren't to be taken at face value.
They exist purely to make the logical business concepts I am trying to convey, hopefully, easier to understand.

Does that answer your question?
post #33 of 46
the op sounds a lot like Reev... satisfied.gif
post #34 of 46

for more luxurious items - size does matter when it comes to cost.

post #35 of 46
To take denim jeans as an example, because it is a simple case (all denim jeans, even the fanciest of the fancy, are made primarily from cotton):

http://www.ccgga.org/cotton_information/how_much.html

So 1 pair of jeans consumes about 1.5 pounds of cotton. Let's be generous and assume that the variation in cotton consumed varies from 1 pound for a "small" to 2 pounds for a "large". How much does that extra pound of cotton cost for the large at the current cotton price?

87 cents.

That is your total materials cost savings for a small size available "in the system" to be split up amongst the farmer, cotton trader, denim weaver, jeans manufacturer, and retailer. And that is why a small costs the same as a large.
post #36 of 46
Quote:
Originally Posted by mcbrown View Post

To take denim jeans as an example, because it is a simple case (all denim jeans, even the fanciest of the fancy, are made primarily from cotton):
http://www.ccgga.org/cotton_information/how_much.html
So 1 pair of jeans consumes about 1.5 pounds of cotton. Let's be generous and assume that the variation in cotton consumed varies from 1 pound for a "small" to 2 pounds for a "large". How much does that extra pound of cotton cost for the large at the current cotton price?
87 cents.
That is your total materials cost savings for a small size available "in the system" to be split up amongst the farmer, cotton trader, denim weaver, jeans manufacturer, and retailer. And that is why a small costs the same as a large.

If you add in the additional costs associated with having a more complicated pricing structure (extra time, additional chance in pricing it wrong, "theft" by switching labels, extra headache, etc.), you'll find that you spend several dollars trying to increase profits by a few cents.
post #37 of 46
Quote:
Originally Posted by Reborn View Post

Price for the average and make up the loss(xxl) and gain(xs) from each end.
How is this so hard to understand?
You're suggesting:
XS-$8
M-$10
XXL-$12
Real world:
XS-$10
M-$10
XXL-$10
Either way you wind up with $30. The athletic 1% are subsidizing the fat ass 99%.

Not all XXL are fat you know wink.gif

In fact, I had a lower body fat percentage when I did wear XXL than I do now wearing L. laugh.gif
post #38 of 46
Quote:
Originally Posted by Achilles_ View Post

Not all XXL are fat you know wink.gif
In fact, I had a lower body fat percentage when I did wear XXL than I do now wearing L. laugh.gif

Beefcake? laugh.gif
post #39 of 46
Also telling your customers to pay up because they are big is not a way to endear them to your brand.
post #40 of 46
This question has come to mind when buying a cashmere overcoat. Why is the size 36 the same price as the size 46? I know the craftmaship is the same, but the amount of pricy material used varies.

Maybe that is yet another reason why most retailers focus on woman's clothing: (for the most part) less raw materials.
post #41 of 46
Quote:
Originally Posted by Patek View Post

This question has come to mind when buying a cashmere overcoat. Why is the size 36 the same price as the size 46? I know the craftmaship is the same, but the amount of pricy material used varies.
Maybe that is yet another reason why most retailers focus on woman's clothing: (for the most part) less raw materials.

Well, that and the fact that women, in general, care more about clothing and are more frequent purchasers of clothing.
The market value of women's clothing is also higher, in general, leading to higher profit margins.

Men as a whole generally don't care as much about clothing and fashion (the men of SF are not a representative sample for the mass majority of men).
What some studies have actually found is that a fair percentage of men's clothing is purchased for men, by women.
post #42 of 46
Most lower tier brands that offer tall sizes (Lands' End, LL Bean, Gap, BR) usually charge more for the talls.
post #43 of 46
I'm not a tall man, but I am stout. I try to use this to my advantage (read: save money) by buying Big and Tall shorts. They fit me much in the way pants would.
post #44 of 46
It would be nice if they did charge more for bigger sizes, because it would cut down on men buying things a size too big for "comfort" or something.
post #45 of 46
Quote:
Originally Posted by caseyfud View Post

It would be nice if they did charge more for bigger sizes, because it would cut down on men buying things a size too big for "comfort" or something.

While I am a previous offender and have been over the years slimming down my wardrobe, you need to understand not every guy cares about the vagaries of fashion or where the vacillating needle of fashion will point to today.

Hell, I seem to recall zoot suits used to be the prime of fashion yet today's fashion trends would probably consider them nothing short of comical and ill-fitting.

Not to mention, what's wrong with someone buying clothing for comfort?
You buy clothing to look good in the eyes of today's "fashionistas".
They buy clothing to be comfortable in their daily lives.
Edited by bubbleboys - 12/20/11 at 1:14pm
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