This is an important question for a fashion label owner, and I am being asked this question at least once per day.
Here is your answer in a nutshell.
Your MSRP (Manufacturer’s Suggested Retail Price) is not less than your COP DDP (Cost of Production Delivered Duty Paid) times 5. FIVE. Not two. Not three. FIVE.
If your clients are not willing to pay the price you are getting multiplying your COP DDP by 5, there may be two reasons:
1) You are talking to a wrong client.
2) Your COP DDP is too high.
In the first case, test alternative customer groups.
In the second case:
A) Stop sewing by yourself and outsource your manufacturing!
B) If your manufacturing is outsourced already, talk to your manufacturer about COP optimization, change fabrics, simplify craft, increase order volumes, change shipment from air to sea (use sea as a standard way of shipment from the very beginning).
5 times markup gives you flexibility to work with the full variety of short and long distribution chains.
Any questions? Ask me in the comments! 🙂 I am here for you.
Also, let me know what do you currently charge and why?
LMK in the comments and let’s have a look at your current pricing and how to improve it.
P.S. 5 spots left in Fashion Invention Bootcamp to work with me one-on-one. LMK if one spot is yours.