Why Is Los Angeles Apparel So Expensive?

The fashion and designer clothing scenes in Los Angeles are some of the most famous in the entire world.

If you're curious about the rich history and culture behind LA fashion, the vast majority of the influential designers and boutiques to get the gist of the popular city's style can be found within the city limits.

The downtown area is home to the most well-known boutiques and the major designers, as well as Los Angeles Fashion Week, which is held at the Los Angeles Convention Center every year.

To add some more diversity to the list of famous LA fashion designers, we rounded up eight different Los Angeles fashion labels and houses that have iconic fame in their local and global fashion scenes.

Here are some reasons why LA clothing companies are expensive:

High minimum wage and faciliy costs

LA will soon pay a new minimum wage of $15.20 an hour for employers. That’s an increase of $1.61 an hour, or 22 percent.

As well as needing to produce on the premises, many fashion companies need to pay high wages to get skilled workers to work on-site, sometimes up to $20 per hour.

In order to get this kind of talent, fashion companies have to use contract labor

On top of high wages, having factories onsite is often impossible for LA boutiques, because landlords typically won't rent space to the fashion companies unless their firms are fully staffed.

Small companies are more risky tenants, so this becomes a catch-22 for most LA clothing companies. To get access to cheaper production, they need to be bigger companies.

These are just some of the reasons why finding the right facility can be difficult, but not impossible.

However, there are other advantages to using factories as opposed to having onsite staff. It might be more cost-effective. Or it might be more profitable.

For example, some fashion companies employ a combination of both. Take the brand Meticulous Eyewear, which is currently the biggest brand on the virtual reality glasses market.

They have factories in Los Angeles and California's San Fernando Valley. But they also use contract workers from Asia. "Our look makers are Asian women, and what I find is that they're incredibly fast and they produce exceptionally well," says Chris Vo. "They're good at their craft."

LA has a super high cost of living

Costs of rent, manufacturing, design and customer service could be to blame for the high cost of LA-based clothing.

To sell clothes in LA, people need to pay high rent, a high product price and have an entrepreneurial mindset.

In addition, some LA-based clothing companies have closed down because of slow sales and lack of investment.

Many boutiques create only limited runs

Boutique stores make their clothes in limited supply.

Combined with a high demand for their pieces, this causes prices to soar.

Many clothing companies use sewing factories that produce their clothing in limited amounts, resulting in the cost of certain pieces skyrocketing.

Many customers are only able to get one or two pieces from a particular boutique. In contrast, the vast majority of pieces from "mass market" clothing companies are produced in larger quantities and will usually be on sale at one retailer or another.

Small supply brings increased prices

If a Los Angeles clothing brand is promising that "not even the guys in fashion are wearing it," customers will pay a premium.

Business Insider has previously covered brands that are allegedly meant for fashion bloggers and people who can afford to buy expensive things but are still advertised at an accessible price point.

A Los Angeles brand called Chadwicks (the name stand for Chadwicks, the owner) doesn't advertise much, but the company has become quite popular, thanks in part to its beautiful, brightly colored beanies.

Chadwicks sells items that are sold out on their website - products that people believe are exclusive to the brand.

"Chadwicks items don't just sit on the website and rack at $40. Once they're sold out, they're not coming back," an Instagram user who has been following the brand for a year told Business Insider. "If you don't see 'sold out' on the Chadwicks website, buy it now!"

That belief that they're exclusive comes at a high price: a $44 beanie. People have no problem supporting these prices, however, for the reasons mentioned above.

People who want to buy things they think are "exclusive" will be willing to pay a higher price than usual

In 2011, online luxury retailer Bergdorf Goodman dropped the price of its Los Angeles-made apparel, shoes and accessories to $1,400 from $1,800.

The sale was an attempt to appeal to the West Coast's high-end fashion buyers. But Bergdorf Goodman was also responding to growing demand.

This example illustrates a basic principle that is one reason LA apparel prices are so high: people are willing to pay a premium in order to feel "exclusive." 

Dropping the price of a good from $1,800 to $1,400 hardly makes it accessible to the masses. But for buyers at the high-end of the market, that drop may be significant enough for them to jump on board and make a purchase.

LA is one of those cities where people will do pretty much anything to feel cool and hip. Paying absurd sums for clothes is just one part of the puzzle.

Conclusion

Los Angeles is home to many famous individuals whom we can only usually see on television - actors, actresses, models, business tycoons - you name it! Aside from this, it is also home to the largest collection of fabrics.

At present, the Los Angeles Fashion District is home to more than 2000 independent retailers and wholesalers of clothes, footwear, and accessories and produces many unique pieces at a daily basis. The prices of the products will cause twice or thrice as much as those you can find in China because of labor.

They only make sure to invest in the vest craftsmen who have studied intently the art and beauty of fashion. Likewise, only a few orders can be made because of the intricateness of each piece’s design.

This is the main reason why Los Angeles is home to many expensive clothing and fashion items. They have great attention to detail and make sure their customers get only the best quality products.

To help customers decide, they create prototypes of their products so that customers have a background or an inkling of how their pieces will look like.

While the cost may be too high, for people with the best fashion taste, this is the best there is.