My Biggest Mistake With Costing & Pricing My Clothing Line
There were definite advantages to starting my business at 25:
Of course, the downside of being 25…
Here’s the deal. When I was figuring out my product pricing, I based it entirely on my wallet. If I wouldn’t pay $250 for a dress—and my friends wouldn’t either—I assumed no one else would.
Classic rookie move.
I made the mistake of projecting my personal values onto my customers. And it’s one of the most common mindset traps I see creative entrepreneurs fall into. I meet with hundreds of designers in my mentoring programs, and this exact thing still trips people up all the time.
Your pricing strategy can’t be based on what you’d pay. It has to be based on what it’s actually worth—and what your business needs to survive.
At the time, I didn’t have the deep, unshakable confidence in my product yet. So instead of charging what I should’ve, I priced things to “give people a deal.” A ‘deal’ that would’ve sunk my business if I hadn’t fixed it in time.
- I lived cheap—like, a dingy studio apartment with a view of a police parking lot (which was loud. All. The. Time.)
- I had nothing to lose. Worst case, I’d go back to waitressing.
- Friends showed up to help paint my boutique walls in exchange for beer and pizza. Done.
- I thought like a 25-year-old—which, in some ways, was great. I was bold, scrappy, and willing to try new things.
- I had zero real experience, so every mistake cost me money.
- I couldn’t get a loan—no collateral, no clue.
- And yeah… I thought my pricing strategy was “what I would pay”—which was a huge red flag.
- That last one? That mindset nearly tanked everything.
Classic rookie move.
I made the mistake of projecting my personal values onto my customers. And it’s one of the most common mindset traps I see creative entrepreneurs fall into. I meet with hundreds of designers in my mentoring programs, and this exact thing still trips people up all the time.
Your pricing strategy can’t be based on what you’d pay. It has to be based on what it’s actually worth—and what your business needs to survive.
At the time, I didn’t have the deep, unshakable confidence in my product yet. So instead of charging what I should’ve, I priced things to “give people a deal.” A ‘deal’ that would’ve sunk my business if I hadn’t fixed it in time.
Spoiler: that is not how effective pricing strategy works.
It was two days before my boutique’s grand opening. Every single item in the shop had been designed by me and manufactured in small sewing factories in Chicago. I was thrilled. I was terrified. And honestly? I had no clue what I was doing when it came to product pricing.
I never set out to run a retail store. I loved designing. I loved selling. But product pricing? Pricing strategy? That part was a mystery wrapped in an enigma, dipped in panic.
The whole thing started because of a conversation with my friend Marcos from F.I.T. He ran a women’s clothing line in New York and casually said, “Jane, if you really want to make a business and have a life, open a small store. Design whatever you want in the back. Skip wholesale. It’s easier.”
He had me at “easier.”
So I did it. I opened a boutique at 25 years old, armed with talent, ambition, and absolutely no clue about pricing models, fixed costs, or profit margin. I just thought, “If I wouldn’t pay $250 for a dress, why would anyone else?
So let’s talk about the internal monologue that messes with all of us at some point—especially when we’re still building confidence in our product pricing.
Is my product really worth it?
Why would someone pay this when they could buy from [insert big brand here]?
Maybe I’ll just price low now and raise it later…
Sound familiar?
This head game is real—and it’s one of the main reasons I see entrepreneurs undercharge. We convince ourselves that we need to prove ourselves first. That we can’t use value based pricing until we’ve “earned it.”
But here’s the truth: if you don’t believe in the value of what you’re selling, your customers won’t either.
Why would someone pay this when they could buy from [insert big brand here]?
Maybe I’ll just price low now and raise it later…
Sound familiar?
This head game is real—and it’s one of the main reasons I see entrepreneurs undercharge. We convince ourselves that we need to prove ourselves first. That we can’t use value based pricing until we’ve “earned it.”
But here’s the truth: if you don’t believe in the value of what you’re selling, your customers won’t either.
And that brings me to my “holy crap” moment…
Two days before my grand opening, a fashion industry insider—someone I now consider a mentor—stopped by the store.
She looked at my tags and didn’t sugarcoat it:
“Jane, you’re selling these things at wholesale prices. You’ll be out of business in 6 months.”
What the whaaaaa?! I was stunned.
I’d priced my entire line using what I thought was a fair, generous strategy—aka “a good deal” for customers. But what I didn’t realize at the time was this; a good deal that doesn’t allow you to stay in business is not a pricing strategy. It’s sabotage.
Cue the spiral. Full-blown panic. There were tears (duh). But once I pulled myself together, I realized she was right.
And I had a decision to make.
I wanted this business to succeed so badly. But when it came to product pricing, I was buckling. I kept telling myself, “Just price it low to get sales and raise it later.”
She looked at my tags and didn’t sugarcoat it:
“Jane, you’re selling these things at wholesale prices. You’ll be out of business in 6 months.”
What the whaaaaa?! I was stunned.
I’d priced my entire line using what I thought was a fair, generous strategy—aka “a good deal” for customers. But what I didn’t realize at the time was this; a good deal that doesn’t allow you to stay in business is not a pricing strategy. It’s sabotage.
Cue the spiral. Full-blown panic. There were tears (duh). But once I pulled myself together, I realized she was right.
And I had a decision to make.
I wanted this business to succeed so badly. But when it came to product pricing, I was buckling. I kept telling myself, “Just price it low to get sales and raise it later.”
But that doesn’t work.
You don’t get “proof of concept” when your prices are too low to sustain the business.
You get burnout.
You get stuck.
And worse—you get customers who expect those low prices forever.
So I did the scariest thing I’ve ever done in my business…
I doubled the prices on everything.
The night before I opened.
Yep. DOUBLED.
At that point, I had $432 in the bank and zero backup plan. But I held my breath and launched anyway. I figured I could always waitress…
And guess what? People bought.
Huge sigh of relief. Huge.
Even writing this still gives me flashbacks.
It was terrifying. But doubling my prices was the best decision I ever made.
If you’re struggling with costing and pricing your products, here’s what I wish someone had told me back then:
Use a “real” cost sheet. Trust the math—not your emotions. Make sure you use cost sheet that’s meant for small apparel companies, not big brands (there’s a difference).
Do your market research. Know who else is out there, what they charge, and why. Make a grid. List the competitors, what makes them stand out (or not), and how your product compares.
“I’ll start low and raise later” is not a plan. If you build a customer base at break-even pricing (or below), you’ll just have to start over again when you get tired of being broke. You’re just creating more work for future-you.
Some people use a cost plus pricing model. Some go with value based pricing. Whatever you choose, just promise me this—you’ll pick a strategy that allows you to actually make money. Because this business of yours? It deserves to be sustainable.
Thank goodness for people who tell it to us straight.
I still think about my mentor and how she totally saved my arse… and I hope you can learn from my mistakes when it came to profit margins and lower prices.
You get burnout.
You get stuck.
And worse—you get customers who expect those low prices forever.
So I did the scariest thing I’ve ever done in my business…
I doubled the prices on everything.
The night before I opened.
Yep. DOUBLED.
At that point, I had $432 in the bank and zero backup plan. But I held my breath and launched anyway. I figured I could always waitress…
And guess what? People bought.
Huge sigh of relief. Huge.
Even writing this still gives me flashbacks.
It was terrifying. But doubling my prices was the best decision I ever made.
If you’re struggling with costing and pricing your products, here’s what I wish someone had told me back then:
Use a “real” cost sheet. Trust the math—not your emotions. Make sure you use cost sheet that’s meant for small apparel companies, not big brands (there’s a difference).
Do your market research. Know who else is out there, what they charge, and why. Make a grid. List the competitors, what makes them stand out (or not), and how your product compares.
“I’ll start low and raise later” is not a plan. If you build a customer base at break-even pricing (or below), you’ll just have to start over again when you get tired of being broke. You’re just creating more work for future-you.
Some people use a cost plus pricing model. Some go with value based pricing. Whatever you choose, just promise me this—you’ll pick a strategy that allows you to actually make money. Because this business of yours? It deserves to be sustainable.
Thank goodness for people who tell it to us straight.
I still think about my mentor and how she totally saved my arse… and I hope you can learn from my mistakes when it came to profit margins and lower prices.
Real Talk: These Pricing Mistakes Are Still Happening
After working with hundreds of designers and small business owners through Fashion Brain Academy, I can tell you with 100% certainty that these same mistakes are still happening every day.
And it’s not just startups.
I’ve worked with entrepreneurs who’ve been in business for years—they have loyal customers and steady sales, but they’re still struggling to pay themselves. And when we dig in? Nine times out of ten, it comes down to one thing: their product pricing structure is broken.
And they’re working too hard ot make too little money.
And it’s not just startups.
I’ve worked with entrepreneurs who’ve been in business for years—they have loyal customers and steady sales, but they’re still struggling to pay themselves. And when we dig in? Nine times out of ten, it comes down to one thing: their product pricing structure is broken.
And they’re working too hard ot make too little money.
Top Product Pricing Mistakes I See (And How to Fix Them)
Mistake #1: Using a “Bad” Cost Sheet
Just because your cost sheet has formulas doesn’t mean it’s actually giving you the truth.
One client I worked with had been a successful wholesale sales rep for a major apparel brand. When she launched her own line, she used the same cost sheet and margins from her old company. She was fantastic and sales, she had a great financial advisor, and she sold over $200K in her first season!
And yet… she almost went out of business.
Why? Because the cost sheet she used was based on a volume pricing strategy that works for massive brands. When you’re not producing thousands of units, you need a costing and pricing strategy that reflects YOUR numbers. Not theirs. It’s apples and oranges.
One client I worked with had been a successful wholesale sales rep for a major apparel brand. When she launched her own line, she used the same cost sheet and margins from her old company. She was fantastic and sales, she had a great financial advisor, and she sold over $200K in her first season!
And yet… she almost went out of business.
Why? Because the cost sheet she used was based on a volume pricing strategy that works for massive brands. When you’re not producing thousands of units, you need a costing and pricing strategy that reflects YOUR numbers. Not theirs. It’s apples and oranges.
Mistake #2: Believing Internet Gurus About Markup
If you’re using the old “COGS x 3 = retail price” formula, you might be in trouble. That rule of thumb doesn’t work when you want:
Your desired profit margin needs to reflect your actual business model—not a Pinterest quote. Too many people preach a markup that wil NOT work fr small apparel and accessories brands. Especially it you make an apparel product that needs to fit a human body. Your prodyct developments costs will always be higher that the average candle or planner company.
- Money to run ads
- Room to offer discounts
- Budget for shipping, returns, or customer engagement tools
- Product innovation and an impeccable fit
Mistake #3: Fudging the Numbers on Your Cost Sheet
I wasn’t always honest on my cost sheets. Didn’t want to see the truth. It pains me to admit this becuase who was I even lying to? My accountant? LOL — it was just me but still, I sometimes fudged my numbers a bit.
Maybe you guess on quantities. Maybe you skip over the freight charges. Maybe you “forget” to include labor costs or raw materials. But here’s the thing:
If your cost sheet isn’t brutally honest, your pricing strategy will never work.
“As someone who’s worked with Jane personally, I can say her pricing strategy saved my business.
I used to leave my hand-sewing labor off my cost sheet because I’d do it while watching Netflix. “It’s no big deal,” I told myself.
But as my business grew, I got overwhelmed. I had to start paying someone else to do that work—and suddenly, those “free hours” weren’t so free. Jane’s system helped me build a pricing model that actually accounted for the real cost of my time.
If you think you’re just being scrappy, check yourself…” – Erika Owner & designer of Rare Dirndl
Maybe you guess on quantities. Maybe you skip over the freight charges. Maybe you “forget” to include labor costs or raw materials. But here’s the thing:
If your cost sheet isn’t brutally honest, your pricing strategy will never work.
“As someone who’s worked with Jane personally, I can say her pricing strategy saved my business.
I used to leave my hand-sewing labor off my cost sheet because I’d do it while watching Netflix. “It’s no big deal,” I told myself.
But as my business grew, I got overwhelmed. I had to start paying someone else to do that work—and suddenly, those “free hours” weren’t so free. Jane’s system helped me build a pricing model that actually accounted for the real cost of my time.
If you think you’re just being scrappy, check yourself…” – Erika Owner & designer of Rare Dirndl
Mistake #4: Starting Low with Plans to Raise Prices Later
Sounds reasonable, right?
“Once I get more customers, I’ll increase my prices.”
But here’s what really happens: You build a customer base that expects lower prices. When you finally adjust to the appropriate pricing strategy, your sales drop and you have to start over with new buyers who are willing to pay what you’re actually worth. Not a good long term plan.
“Once I get more customers, I’ll increase my prices.”
But here’s what really happens: You build a customer base that expects lower prices. When you finally adjust to the appropriate pricing strategy, your sales drop and you have to start over with new buyers who are willing to pay what you’re actually worth. Not a good long term plan.
Mistake #5: Ignoring Freight From Vendors – in Unit Costs
Freight isn’t the same as shipping.
Freight is what it costs to get your materials from your vendors point A to point B before you even produce the item. Think: fabric from a supplier, skins to a leather factory, hardware from your vendor.
Example: One of my clients produces leather bags. She ships raw materials from Philadelphia to a factory in South Carolina. Then the sewn bags get ship back to Philly. And then, she ships them out to customers who order online.
That freight back and forth before she ships DTC? That’s part of your cost of goods sold. If you’re not building it into your cost sheets, you’re losing money.
Freight is what it costs to get your materials from your vendors point A to point B before you even produce the item. Think: fabric from a supplier, skins to a leather factory, hardware from your vendor.
Example: One of my clients produces leather bags. She ships raw materials from Philadelphia to a factory in South Carolina. Then the sewn bags get ship back to Philly. And then, she ships them out to customers who order online.
That freight back and forth before she ships DTC? That’s part of your cost of goods sold. If you’re not building it into your cost sheets, you’re losing money.
Mistake #6: Not Knowing What Belongs on a Cost Sheet
Quick rundown of what should be on your cost sheet:
The list may vary depending on your product and company structure, but you get the idea.
- Raw materials
- Freight (as described above)
- Labor
- Packaging
- Labels, tags, hangers
- Overhead costs (portion of rent, admin, software, etc.)
- Cost of production
- Sampling and development costs (yes, really!)
The list may vary depending on your product and company structure, but you get the idea.
Mistake #7: Only Doing Your Costing Once Per Season
This is a big one. Your cost sheet isn’t a one-and-done. It should be reviewed at three key stages:
Doing this helps you track pricing changes over time, spot issues with gross margin or net profit margin, and fine-tune your pricing model with confidence.
- Design Phase – Start with a target price and design with production in mind.
- Pre-Production – After you get a quote from your manufacturer.
- Post-Production – Once you know actual costs, update your sheet to reflect what really happened.
Doing this helps you track pricing changes over time, spot issues with gross margin or net profit margin, and fine-tune your pricing model with confidence.
What Makes an Effective Pricing Strategy?
An effective pricing strategy accounts for:
Different pricing strategies work for different business goals. Some use value based pricing, others lean into market oriented pricing, penetration pricing, or price skimming. The trick is picking one that works for your product or service.
If you don’t have a process to regularly review pricing data, track competitor pricing, and optimize profitability, then pricing experiments can be risky.
But with the right system? Pricing gets easier, faster, and way more profitable.
- Your target market and their willingness to pay
- Competitor based pricing and perceived value
- Total costs, including hidden ones like freight
- The final price you need to hit for a healthy profit margin
Different pricing strategies work for different business goals. Some use value based pricing, others lean into market oriented pricing, penetration pricing, or price skimming. The trick is picking one that works for your product or service.
If you don’t have a process to regularly review pricing data, track competitor pricing, and optimize profitability, then pricing experiments can be risky.
But with the right system? Pricing gets easier, faster, and way more profitable.
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