How to Price Your Fashion Collection for Profit

You launched the line. A few sales are coming in. DTC feels okay.

Then a boutique asks if you sell wholesale, and you do the math in your head, and realize that if you cut your price in half, you’d be losing money on every unit.

That’s a margin problem. It’s also one of the most common mistakes I see, and I made it myself with Workery Apparel. I priced emotionally. I picked numbers that felt right against what I saw on competitor sites. When a buyer eventually asked about wholesale terms, there was no retailer margin left to give.

A wholesale price isn’t a discount on a DTC price. It’s its own strategy.

DTC and wholesale margins are not the same conversation

The two formulas most fashion brands run on:

DTC (direct-to-consumer):

• Retail price = cost of goods × 2.5 to 3.0
• You keep the profit
• That margin covers marketing, shipping, returns, and overhead

If your product costs $20 to make, your DTC price sits between $50 and $60.

Wholesale:

• Wholesale price = cost of goods × 2.0
• Retail price = wholesale price × 2.0
• The retailer marks it up for final sale

So if your cost is $20, wholesale is $40, and retail is $80.

Keystone pricing, and why buyers expect it

Keystone means the retailer doubles your wholesale price to get retail. Most boutiques and specialty stores plan around it. If your numbers don’t support keystone, a buyer can love the product and still walk away. The math doesn’t work for their floor.

This is why launching DTC and trying to back into wholesale later rarely holds together. Price the wholesale model first, then set DTC on top of that.

What actually belongs in your cost of goods

Founders routinely undercount here, which is how a $20 garment quietly becomes a $28 garment by the time it’s in a box.

• Fabric and trims
• Pattern and tech pack fees, amortized
• Sampling costs
• Packaging and labeling
• Inbound shipping
• Duties or tariffs
• Labor, including your own, even on the first run

Leave any of these out and your margin is fiction.

Underpricing is not safer

Pricing too low feels conservative. It isn’t. It eats your reinvestment budget, signals the wrong thing about the brand, and leaves no room to absorb a bad production run or a slow month. Pricing for profit is pricing for survival.

If you’re already selling and the numbers don’t work

You’re not stuck. You’re recalibrating.

• Recalculate cost of goods honestly, every line item
• Test a new price point on the next drop, not retroactively across existing inventory
• Look at the design. Sometimes one trim or one finishing detail is the reason the math fails
• Build a clean pricing sheet before you talk to a single buyer

A quick read on whether your pricing is healthy

Three questions:

• Does the product support both wholesale and DTC margins at keystone?
• Could you pay yourself and reinvest at this price?
• Would a buyer see your line sheet and immediately understand the price point?

If any answer is no, the fix is upstream of marketing.

Your prices aren’t just numbers. They’re your business model. I help founders clean up margins and rebuild pricing before the next production run, so the next drop is profitable before it ships.