How I Determine LyndenTree Designs’ Prices

 

Note: This is from before March 29, 2023. The formula has changed. Update coming when my ADHD brain gets around to it.

I believe in being transparent about how our business and pricing works, so here’s what goes into determining a price for a garment.

At LyndenTree Designs I prioritize paying workers a living wage, not just the legal minimum wage. In my area, that’s $17.15/hr*. 

The manufacturing cost of a garment is based on the total cost of supplies and labour, plus a shop fee that covers things like thread, machine wear and tear, cost of electricity, etc. 

Fabric generally costs around $15/m, and most of the garments at the moment take 2-3m of fabric.

The manufacturing cost is multiplied by 1.4 to get the wholesale cost. This covers things like designer compensation, shipping supplies, running the website, and business supplies like sewing machine feet and hang tags.

The wholesale cost is enough to maintain the business and cover expenses, and have a bit of a cushion in savings, but there’s not much wiggle room for growth. 

That’s where the retail amount comes in. I multiply the wholesale cost by 2 to get the retail amount. This covers things like marketing, developing new designs, being able to do shows, and builds up resources for future expansion like being able to hire more sewists or breaking into new sales markets. 

I’ll also round the number up slightly so that it’s not an awkward-to-remember cost like $248.05. 

So that’s how I determine pricing, let’s look at how it applies to a specific garment: 

~~~

The Pricing Formula for the Europaea Skirt

3m of fabric at $15/m = $45
2h 15m of labour at a living wage of $17.15 = $38.59
Shop fee = $5
Cost to manufacture: $88.59

Multiply manufacturing cost by 1.4 to get Wholesale: $124.02

Multiply wholesale by 2 to get Retail: $248.05

Round up to make the number easier to remember: $255 
(Avoid $250 ‘cause the number looks fake.)

Custom designs have $20 added to the final price to cover the extra calculations and time involved.

~~~

Once I set the price I’ll avoid fiddling with it for a few years. The living wage may go up or down depending on the economy, and I will change what I pay my sewists accordingly, but I won’t change the price for consumers right away. The costs are calculated when the design is relatively new, and as time goes on it gets faster to sew the garments as the sewists become more experienced with the garment. So the cost of labour may go up, but the time each garment takes might go down. 

Fabric costs also change. They will go up due to inflation, but also as my business grows and gains purchasing power, I can buy larger quantities which takes down the cost per metre of fabric.

It’s all a balancing act, and I could (and have) driven myself to anxiety trying to figure out how to price my garments, so it’s more important for me to settle on something and just go with the formula I’ve determined. I’ll reevaluate the pricing formula and garment costs every year, but I won’t second-guess myself every month. 

Now, I know to some people these prices might seem high, but honestly, there’s no way to reduce them significantly in a sustainable and ethical manner. This is just what it costs to make something in Canada. You’re supporting people with a living wage, paying fair costs for fabric, and investing in a network of other suppliers and businesses that I purchase from. A garment from LyndenTree Designs is an investment in the Canadian economy, in Canadian sewists. 

*2021 numbers, based on https://livingwagealberta.ca/living-wage/