The Key to a Great Retail Price

What's Up!

I'm here to talk about Assignment 1, Course 3, of ParsonsxTeenVogue Industry Essentials course.

Back in Course 2, we were supposed to create our own accessory out of unconventional materials. I created a felt pad necklace. In course 3, we were then supposed to take that item and figure out what all the materials cost, including labor. My prices are laid out below:

Felt Pads -  $3.97

Electrical Tape  -  $2.99

Plumbers Tape  -  $1.99

Fishing Line  -  $8.95

Twine  -  $5.99

.5 hours at 10.00  -  $5.00

Total Production Price  -  $28.89

20% Profit  -  $5.78

Total Cost Plus Profit  -  $34.67

Estimated Retail Price  -  $34.99

Now, that retail price is way too low for the product, if it has such a high wholesale price. The wholesalers aren't going to buy my product and put it in their stores if they only make a few cents from it. They need a profit margin too. They have to buy it around half of the retail price so that some money comes back to them, even when they mark down prices. So, we were to lower our wholesale price by cutting costs and production time. If I bought my materials in bulk, these would be my prices:

Felt Pads  -  0.37 cents

Electrical Tape  -  0.01 cents

Plumbers Tape  -  5.64 cents

Fishing Line  -  0.03 cents

Twine  -  1.08 cents

.15 hours at 10.00 dollars  -  $1.50

Total Production Price  -  $1.58

20% Profit  -  0.32 cents

Total Cost Plus Profit  -  $1.90

Estimated Retail Price   -  $34.99

Stores can buy my product for almost two dollars and then sell for $35 dollars! Those profit margins are great; but, I'm not so sure about the price. I think I would have to lower it to $12.99 or so, because we're not talking about Prada here.

This assignment definitely gave me a look into the business side of fashion and accessories. I learned there's a lot more to fashion than just design. I also learned the beginning steps of managing an accessories line! And, I liked it. Maybe I'll work in accessories one day.😄