What is the retail mark-up of a handbag?

TPF may earn a commission from merchant affiliate
links, including eBay, Amazon, and others

indiaink

indiaink

O.G.
May 3, 2007
17,491
11,497
#1
I've been wondering ... since I just bought a very expensive bag for almost 60% off from a retailer who is going out of business I was curious - I would hope this company recouped their money from the sale, but - .

I know books have an approximate 40% mark-up, but I know nothing about bags.

Anybody know?
 
#3
Many bags are closer to clothing in the amount of markup they have. Especially bags made in China or other countries with low worker wages and much lower overhead.

And while I am not sure of this, I believe the retailer pays the sellers and then takes responsibility for the product in most cases, meaning whoever made the bag was already paid. If the store doesn't recoup its costs on the bag (though it likely would, even if you are paying only 25% of retail), the loss falls to the store. But very few retailers take a loss on ANYTHING, even when selling at massive discounts.
 
#4
Most retailers that I know of have a deal worked out with the wholesalers that if something doesn't sell, they can either get their money back or at least part of their money back, if not money then they have credit to apply to things for the new season. Retailers rarely ever take a complete loss, unless it is a small shop.
 
#5
lantana19 said:
Most retailers that I know of have a deal worked out with the wholesalers that if something doesn't sell, they can either get their money back or at least part of their money back, if not money then they have credit to apply to things for the new season. Retailers rarely ever take a complete loss, unless it is a small shop.
Click to expand...

Yep, that's true. Very messed up, if you ask me.

In my experience, bags are usually marked up 40-60% from the wholesale prices.
 
#6
OK. Thanks for all the input, ladies. I figured it was like most things of this nature... and, of course, the more expensive, the more the mark-up, I'm sure. You KNOW that there's not thousands of dollars in some bags - all you're paying for is the 'name'.
 
#8
Oh yes, toni, I agree with you - a special design is everything. Anybody who is a handbag nut knows certain bags' designers just by seeing the bag - and that's priceless.
 
#9
I remember reading an Los Angeles Times article about the escalating cost of purses and shoes. It was very interesting. Apparently the average markup on purses is twice the wholesale price and 2.4 to 3x the wholesale price for shoes!
 
#10
indiaink said:
OK. Thanks for all the input, ladies. I figured it was like most things of this nature... and, of course, the more expensive, the more the mark-up, I'm sure. You KNOW that there's not thousands of dollars in some bags - all you're paying for is the 'name'.
Click to expand...

ITA. I read somewhere that the markup on Louis Vuitton products is something like 13x!!!:wtf:
 
#11
When I worked retail, (better ladies clothing) the lowest mark-up was 100%. That's why you see so many final sales at 50%.

For example, we'd buy a suit for $200, sell it retail for $400 and still be able to sell it for 20, 30 or 40% off and still make a small profit.

Final sale would be 50% ( which would actually be the original $200, we paid) without an loss, but no profit at all. If it didn't sell then, we'd sell it back to our jobber at a loss.

Many items, particularly accessories, had a larger than 100% mark-up though.
 
#12
kimalee said:
ITA. I read somewhere that the markup on Louis Vuitton products is something like 13x!!!:wtf:
Click to expand...

That was in Dana Thomas's book De-Lux. But I thought she said that LV retail prices were 13x the manufacturing cost (which is usually half wholesale cost or less). I think she said that in comparison typical bags (i.e., non-designer) have a suggested retail of 4 to 5 times the manufacturing cost. But then I could be mistaken.

I also read somewhere that in the last few years large dept. stores like Macy's have been pressuring bag makers to raise their prices so that there's a much greater mark-up. And this is why you see prices increasing while manufacturing corners are being cut.
 
#15
i know buying direct from the mfg as a retailer, its usually somewhere between 2 (keystone) and 2.2. as for buying direct from the company who knows! i know when i worked at coach, we got a half off discount and im sure coach was still making money on us!
 
You must log in or register to reply here.
Top
Back