So today I can across this blog from gq.com and it got me worked up.  It was titled "The Low-Cost, High-Style Labels That Got Us Through the Recession" - it then went on and said, "More Flash for Cash".

The article, which you can read in its entirety here , referred to the items people bought before the recession at specialty retailers and how they can find similar less expensive items at stores such as H and M, Topman, Zara and Uniqlo. 
          
                            
From Japanese company Uniqlo, looks great right?  Wool-cashmere topcoat, $150. shirt, $40. wool pants, $50.  What kind of quality are you going to get with a wool pair of pants at $50?!?  or a cashmere topcoat at $150...that would mean the cost of cashmere/wool would have to be about $5.00 a metre (vs $95 Loro Piana) or there is .0001% Cashemere.  Cashmere is a delicate fabric - what will this coat look like in a year?!            


I have walked into said stores and seen the price tags - and purchased some items myself.  It was the first and very last time I did so - to me quality is more important to me than quantity.  I would rather buy one nice shirt that will last me a few years than buy a bunch of cheap shirts that will look aged after a few months of wearing.

"...turn-over as much product as possible in the shortest period of time."

People have this "Needless Mark-up" thinking when it comes to the specialty stores (in this case Nieman Marcus), but having been exposed to  factories from Florence to Sri Lanka, England to Bangladesh, I understand what things actually cost.  If you find a button-down shirt at H and M for $15.00, made in Bangladesh or Vietnam, anyone can back track it to see what it's actual cost would be. 

Let's take that shirt.  First of all, the shirt has to be designed.  Second, the fabric has to be made.  From there, it is shipped to the factory to be cut and sewn.  There are buttons, labels, and other things you wouldn't think of like thread, machines, labour, etc.  From there, it has to be shipped and sent to the distribution centers, which sends it to the stores.   Then there's the retail markup - these stores have to pay for their rents, labour, executives, travel, etc.  Let's not forget marketing too.  A great deal of cost goes into these items, which is why it's all about turn-over as much product as possible in the shortest period of time.

I know a good shirt fabric.  One that will last a long time, have some weight to it, alone should cost about $30.  And this is on the low end - I'm not talking about one made in England, which would average much higher.  This is why a shirt made in Italy or England (or even here) hovers around $200.00 - there is a reason to this.  It isn't because everyone is getting rich over it.  There's a cost to the quality you are getting.

Let's take this $15.00 shirt:

Retail Markup (low-end):  - $7.00
Warehousing, shipping, distribution, duties:  - $3.00

One is looking at $10.00 in just retail markup and just getting the shirt at the store.  If these stores do it properly, they are both a wholesaler and a retailer.  In other words, they have a wholesale division (which makes the product) and a retail division (which sells the product).  Two divisions which both have to be profitable.  This $15.00 shirt has now become a $5.00 wholesale shirt.

At $5.00, everything else has to be covered, the costs of running the wholesale operations, executive salaries, traveling, and designing.  There's the cost of the fabric and actual labour in making the garment.  This is where you get into 1/2 and 1/4 of pennies.  In other words, a single label will cost .050 cents...1/2 a penny! 

Fabric: $2.00
Labour: $1.25

There's $1.75 left. 

Imagine, when you are looking at clothing at this price level - the quality grade will be at the bottom of the ladder.  From the type of thread in the sewing machines to buttons and fabric. 

In the end, you get what you pay for.