How to determine the price of your clothing


Before you start selling clothes, you should decide what you will charge for your clothes. Pricing for products and services is very complicated. Even established brands find difficulties when pricing their products. It requires a sensitive intuition and cold calculation. The best pricing strategies of pricing use deeper knowledge of the market and a clear understanding of the financials as a basis for experimentation. Several principles apply when pricing your clothing.

Position your brand

Most businesses use a cost-based strategy to price their clothes. This is where the consumer comes from the cost of producing their clothes. Before we go deep into the calculation, it is good to know that the goals of your business affect your pricing. Competitor’s prices and industry standards are benchmarks, but they are not rules. If you want your line to be a niche or luxury brand, you may lose customers by using average markups to price your products. You can also lose other customers with high pricing. Your pricing should be consistent with your selling proposition.


Markups refer to how a seller marks up their product from the previous cost. They are the cornerstone of determining the price of products in the industry. Keystoning is doubling the price of a product. Keystone markups have been used before to simply pricing in the industry. This has made it easy for retailers and wholesalers to markup products to levels that are profitable.

This is how it works; a producer can produce a dress for $4, the dress wholesales for $8 and a retailer sells the dress for $16. As you can see the markup from the manufacturer to the wholesaler is 100% and 100% from the wholesaler to the retailer.

Calculating the profit, cost, and margin

If you want to base your pricing on costs, you should understand your expenses. After knowing the cost of products sold for each item, you can now decide how to mark up the number to make the percentage of profit. Cost of goods sold is the sum of all the direct expenses incurred while producing the product such as the materials, factory overhead, labor, and production supplies. Gross profit is what’s left after subtracting the cost of goods sold from the revenue. The profit to revenue ratio is the gross profit. Once you know the cost of production, you can play with the price and the profit margins to get the desired numbers.