So I’m wearing this sweater today that I got on Sunday for ten dollars at Urban Outfitters. I won’t lie–I bought it strictly because it was ten dollars. Had it been even twenty dollars, I’d have passed it up.
But I figured you can’t go wrong with a ten dollar sweater, and indeed I didn’t; it’s soft, comfy, fits well and is a good color on me. Plus now I’ll have something to wear with my groovy pink “Tree People” skirt to that birthday party on Saturday night.
Of course, being the dork that I am, I was halfway through my day today before I realized that the damn TAGS were still on the sweater. When I cut them off (thank God for those yoga classes, or I never could have made such a tricky maneuver–with scissors, no less), I discovered that the original price of the sweater was $68.00.
$68.00!
OK:
a) I wouldn’t even have breathed in the direction of this sweater for $68.00. It’s nice and all, but not THAT nice, and
b) That $68.00 price tag certainly explains how come there were so many of these bad boys on the $10 sale rack…
…but my question is, how on earth does a sweater depreciate that fast (assuming that, say, two months ago I’d have had to pay the $68.00 if I wanted it)?
And it does make one wonder what the sweater is REALLY worth…
Am I somehow a more fortunate person now because I got a sweater that’s WORTH seventy bucks, for a mere ten?
Or does that just make me NOT an idiot because I didn’t spend seventy dollars on a sweater that’s only worth ten?
The mind reels…
congrats on the sweater, em, and for being flexible enough to snip off the tags!
As for its relative worth, well - that’s a business concept. And the real question is: when did you purchase the sweater in the overall cycle of inventory? Without getting too boring, what probably happened is:
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the sweater cost something like $20 bucks to make (a SWAG, but probably not too far off), and through its manufacturer, a distributor and the original retailer, got marked up - both to cover the various costs (to make, to store, to move from place to place, overhead, etc…) to $68. There is always the concept of pricing to make a margin (i.e., set a profit % you want to make and set the price to make that) vs. pricing what the market will bear (e.g., pricing a Porsche at a super premium price because exclusivity is part of the appeal) but we won’t go into that level of detail hear…
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The real question is: what happened to the inventory? Storing inventory costs money. If the sweater wasn’t moving so there is a ton of them, or if it is time to update the stocks with the latest fashions and there are still a few of that sweater in the warehouse, it is in the best interest of the retailer to move, move, move that sweater out by either: a) slashing the price and selling it during an inventory sale; or b) selling it to a re-seller, like TJ Maxx, Marshalls, etc., who buy old inventory from first-line retailers for pennies on the dollar.
So even though it may be selling for below cost (or at least at cost), it is better for the retailer to cut its losses by getting a little money for it than by having to write off unsold inventory.
Sorry for the too-long business speak.
No no, that’s just the kind of answer I was hoping for! As somebody who LOVES to shop, I’m often stuck in the position of paying full price for something mere moments before it goes on sale, and have been trying to figure out how to anticipate these things better.
(I was raised to believe that if I wanted something, I should just BUY it, because if I tried to wait for it to go on sale, it might be gone, and then I’d be mad. But I’m also mad when I buy a skirt for $30–thinking THAT was a super-sale, since the original price was $72–and then IT drops down to $10, too.)
Auntie Em you and I are some kinda soulmates, twins separated at birth or plain cheap asses. 
I’m with you totally on the never woulda paid $68 for the sweater (ugliest damn sweater I ever saw). However, at $10 (look at that gorgeous sweater…goes with everything in my wardrobe).
I have shirts I bought for $5 that were originally $40. I have a jacket that was originally $145 that I bought for $30. Oh, and my really cool Tommy Hilfiger jacket that was the ugliest damn thing I ever saw when it was $89 in Dillard’s department store turned into the most gorgeous jacket in the universe when I saw it in an outlet store for $19.99.
We should shop together 
My mom used to work in an outlet store(she could get them at cost) and bought my clothes there. I had shirts that she paid $3…jeans were $5…shoes were $3. Long time ago…but I still had them until my girlfriend said they looked like crap and threw them out. My opinion was they were good for another ten years but she said I was a cheap bastard. She might of been right.
Well, I find that the best way to get stuff the cheapest you’ll probably get it is to shop in the wrong season. Buy your winter stuff in June and your summer stuff in October. I hit the clearance racks at the end of the season. Only problem with that is that the selection isn’t always the greatest. But I tend to pick out clothes that don’t really go out of style (no I’m not so trendy that I can predict it–I just wear really basic basic clothing) so it works for me to buy last year’s ‘fashion.’