Originally Posted by dotcomzzz
My sense is the price hike is intended to recoup lost revenue from sale periods (I don't really buy the increased cost of overhead/materials/production arguments). Not to state the obvious, but sale periods seem to be when a lot if not most of a designer's stuff is sold. And although fewer people are likely going to pay retail now, when the sales hit and say a button down shirt "drops" in price people will be swayed by the drop, in essence a guise designed to assuage reservations concerning sticker shock, whatever the discount, ignorant of or neglecting to heed the fact that the shirt's price was ratcheted into the stratosphere at the beginning of the season. It's kind of sad to consider because it alienates core customers (I'm going out on a limb here and assuming a large portion of RG's core customers are also regulars on this thread) at the same time holding the door open for fashion ignorant fuck wits with money to burn to take up residence as the designer's new core customers. I definitely don't blame him, and theres always going to be newer younger designers looking to break into the scene with more competitive options.
Production costs definitely have been going up. Cotton prices have been rising at a rapid clip for the last few years. (Seriously, google "cotton prices rising" or something similar and you'll get a lot of stuff going all the way back to 2010 forecasting that cotton apparel is going to keep getting more expensive. edit: i have no idea about tencel though.) Combine that with any other rising costs and inflation and it makes sense that the wholesale price is on the rise too. It's already expensive for smaller designers to make stuff because of economies of scale. If a designer is only making 10-50 units of one shirt, the sewing cost is going to be a lot higher than if the designer were making 500 shirts. And don't forget that little details like pleated armholes bump the sewing cost up even more, as does the fact that Geller's shirts are made in Japan, where costs are higher than, say, China.
Now don't forget that retailers are multiplying the wholesale price to get their retail price, so any increase in the wholesale gets multiplied. If it cost a designer $60 to make a shirt a few years ago, they would sell it for about $135-$140 to the retailer, who would then sell it for $275-$290 at full retail. If today it costs the designer $67 to make the same shirt, they sell it for $150-$160 to the retailer, who sells it for $345 to $360. That price jump comes from a $7 increase in the production cost.
To go another level, if a designer is making $75 on the sale of a shirt, think of just how many shirts that designer has to sell to make any significant amount of money. (And they're usually paying the rent for an office space, utilities for that space, etc.) Same deal for the retailer, who is taking a risk by buying all these shirts assuming they're going to sell them, and who ends up selling most of them at half off, so they're also making $75 or so per shirt while paying rent, utilities, etc for the store and then trying to have enough left over to pay rent, utilities, etc for their own home.
Being a small designer/retailer, especially in menswear, is a really tough business to make money in. Of course they're worried about alienating their core customers, but there are more pressing problems to deal with most of the time. (Also, I don't think that large a portion of Geller's core customer base is posting regularly on here. Because that's what, like 10-15 people? No business would work if that were the majority of their customer base.)
edit 2: oh, and just fyi, this is all generalization. i have no idea about the internal workings of Geller's business. Edited by pickpackpockpuck - 7/31/13 at 7:53am