Too Much, Not Enough: Competing with "Made in China"

"Why does this cost so much?"

People ask me that question all the time, both about my own work and at my retail job. When I sell my work at craft shows, many people express dismay at my prices. After all, why should they buy a handmade Jaunty Newsboy hat from me for $31 when they can buy what they think of as a comparable item from Target for $14.99?

Before I explain my pricing, I would like to revisit an important and oft-forgotten event in American history.

On Saturday, March 25, 1911, five hundred women reported to work at the Triangle Shirtwaist Factory on the eighth, ninth, and tenth floors of the Asch Building in New York's Washington Square. Most of the garment workers were young immigrant girls who worked 9 hours a day to help support their families. The girls worked for very low weekly wages in unsanitary conditions and were often locked in the factory during working hours. When a fire broke out on the eighth floor the flames quickly spread throughout the factory, with the textiles acting as an accelerant. Terrified workers swarmed the one unlocked staircase and crowded the building's single fire escape, which twisted and collapsed under their weight; dozens of girls fell eight stories to the ground. Some workers were able to escape to the roof or by freight elevator to the ground floor, many with their clothing still on fire. When these exits became inoperable, the girls began to jump from the windows. Passersby initially thought that the owners were throwing bolts of cloth from the windows. Only when they drew closer to the building did they realize that they were watching young women jump to their deaths to avoid being burned alive. Firemen later discovered bodies melted together against the locked door. One hundred and forty-six people died in the fire, and seventy-one escaped with injuries.

The Triangle Fire was one of the most gruesome workplace disasters in American history. In addition to inspiring industrial regulations, wage and hour restrictions, and fire safety standards, the Triangle Fire also gave rise to a class action law suit brought by survivors and family members of the deceased young women. (For a riveting account of the Triangle Fire and the labor reforms that followed, see David Von Drehle's Triangle: The Fire That Changed America.)

Let's look at modern day American labor and employment law. The federal minimum wage is $7.25. Non-exempt American workers receive overtime when they work more than 40 hours per week. The United States also has laws to control family and medical leave, prevent child labor, and provide for unemployment insurance. (For more information on all of these topics, visit the Department of Labor website.) While the laws are not perfect (you'd be amazed how many employers are exempt from compliance with basic employee protections, and there are still numerous sweatshops in operation in the US) labor laws make a huge difference in our collective working life.

Now, let's examine the labor practices in the country the provides most of our cheap imported goods: China. Activists for the global garment industry have documented the working conditions of Chinese garment workers since the early 1990s. At present, the average hourly wage in Southern China is about $0.75 American cents thanks in part to an unlimited supply of cheap labor. Despite American companies' highly publicized promises to avoid buying sweatshop goods, lax enforcement encourages the maintenance of the status quo. Furthermore, many factories have simply become more adept at concealing their practices. Chinese factory workers are frequently locked in the facility, forced to live in prison-like dormitories, and denied access to food or restrooms during the 14-hour work day. (Again, these practices are by no means exclusive to China. If you do a little digging you will encounter sweatshops right here in New York City, where manufacturers benefit from an unlimited supply of illegal immigrant laborers that are often both unaware of their rights and fearful of deportation.)

Why is this allowed? Because we Americans are accustomed to cheap stuff. We are used to buying our food, especially our protein, at inflation-proof prices supported by government subsidies to factory farming operations (everyone who eats should read Eating Animals by Jonathan Safran Foer). And thanks to foreign sweatshops that handily avoid American labor restrictions, we can buy that hat for $14.99. Who cares how it was made, as long as it's cheap?

As you may have guessed, it is all but impossible for an artisan to compete with prices like that. I strive to appeal to my customers on the grounds of quality, uniqueness, and conscience, but I almost always have to sell myself short to make a sale. Let me give you a breakdown of my own costs for making a hat like my Charcoal Gray Eco-Wool Ear Flap Hat:

Cute, right? The first thing you should know is that I do not work from other people's patterns. I design ALL of my products myself. But for the sake of this analysis, we will ignore the time spend in the design process and stick to production costs.

1. Materials: I work almost exclusively with natural fibers. I do this for a few reasons: acrylic, while considerably cheaper, irritates my hands if I work with it too much. Plus, wool is a renewable resource and acrylic yarn is made from petroleum. Yuck.

This hat is made of eco-wool, which is a very high quality wool yarn at an economic $15 per skein. The skeins (units in which yarn is sold) are quite large, so I was able to make this hat from a single skein.

2. Labor: It takes me about 4-5 hours to make a hat like this. Twisted cables look great, but they slow down the production process considerably. Still, this style of hat is very popular this year so I like to include some of them in my shop at all times. Let's say I'm working very quickly and I finish this hat in 4 hours. If I were to pay myself minimum wage ($7.25) that would amount to $29.

3. The Math: You've probably figured this out already. To recoup my investment and pay myself a fair wage, I would have to charge $44 for my hat. In order to stay competitive -- even in the Etsy marketplace, which is supposed to be devoted to handmade goods -- I'm charging $31, for the simple fact that no one will pay me what the hat is worth. Even if someone buys this hat (and there are no guarantees that will happen), I will still lose money.

If you've made it this far into my manifesto, I applaud you. I'm not trying to throw a pity party for myself, because I really enjoy the crafting process. But I also think it's essential that we think more critically about the work that goes into our purchases.

It comes down to this: shoppers are asking the wrong questions. Rather than looking at the handmade item and asking "why does this cost so much?" they should be looking at the mass-produced item and asking "why does this cost so little?"

They might not like the answer.