MoapaPk wrote:I had an eye-opener when I ordered some synthetic wicking, soft-touch shirts with our club logo printed on the back and front. They are great shirts, and the price with printing and shipping came to $27 each. I see similar shirts in REI for $40.
Then I discovered that the unprinted "blanks" sell wholesale to printers for $5 apiece, and those are likely marked up in price by the wholesale distributors.
Admittedly, shirts are simple items, not requiring a lot of human-involved manufacturing. The mark-up you see at REI on such items covers the cost of keeping inventory, paying for the employees, the building of the stores, paying the downstream costs of Nike, TNF or whomever, etc.
Typical retail markup is about 100% so this doesn't seem out of line. That is, if a shirt costs a store $20 at wholesale, they sell it for $40. As far as I know, this varies for high dollar items/hardgoods. For example, in bike shops, the markup on the accessories, parts and clothing might be 100% and the markup on the bikes is much less. The bike shop doesn't stay in business by selling bikes, but by selling all the other tchotchkes, and services (repairs etc).
A 100% markup seems like a lot but most retail stores are running pretty close to the edge, especially if they aren't a big box store, so that tells us something about just how expensive/high overhead it is to provide brick-and-mortar retail service.
Another aspect of this is similar to the accessories subsidizing the sale of bicycles issue - we can bitch about people buying lifestyle gear, but for manufacturers bigger than a cottage industry, they need that to stay in business. I assume that all the people buying Patagucci pants are effectively subsidizing the much smaller production of parkas, belay jackets, ice climbing shells, etc. (And this isn't a slam of Patagucci - I like Patagucci. Especially if they have a half-off sale.) I can't waste much time worrying about what other people wear, and manufacturers can't stay afloat selling only to cheap bastards like me. But what's nice for cheap bastards is that softgoods depreciate more than hardgoods - with that, I am off to troll ebay for a pair of gently used ski pants.