Economics of hat retailing

[Wally in Cincy]

Plus old Gus Miller has the hat market wrapped up in Cinci.

I should have been more specific. She works in Pittsburgh.

She did say that once or twice a month a customer in the store buying a suit or a man off the street will inquire whether they sell hats, but it's not an occurence that happens often enough to motivate them to make the heavy investment in inventory that would be required.

 

[Undertow]

Be that as it may, I would have to ask, how much longer would a $100+ dollar hat last and how much sturdier is it than my $35 wool felt Homburg?...

You are certainly familiar with the rule of thumb, "You get what you pay for." This loosely applies to hats like anything else. You can find a number of threads on the lounge regarding the difference between wool and fur, and there's no need for that argument to spill into this thread.

Suffice to say that fur felt is simply a higher quality, it lasts longer in weather elements, and after some wear it should seem the obvious superior to a wool hat. There are examples of poor fur felts and great wool felts, but there are far fewer superior wool felts. The best a wool could do would be to seem comparable to a fur felt.

If one is not too concerned with higher quality and durability, or with superior feel, then a wool felt is acceptable.

 

[Atticus Finch]

And I think the rule of diminishing marginal utility applies with each additional dollar spent on hats...just as it does with the money spent on most other consumer product. One might experience a large jump in quality per additional dollar spent when choosing between a thirty dollar Wal-Mart woolie and a one hundred dollar Imperial Akubra. And maybe not quite so much increase in quality per additional dollar when choosing between an Imperial Akubra and a Deluxe Akubra...and maybe even less between the Deluxe Akubra and some customs.

AF

 

[1961MJS]

You are certainly familiar with the rule of thumb, "You get what you pay for." This loosely applies to hats like anything else. ...

Hi

Well, you DO get what you pay for, but IN THEORY Tony B can sell EXACTLY the same hat as Optimo in downtown Chicago for say 40% of what Optimo has to have for it because Tony is selling "from his Mother's basement" while Optimo has to pay large sums of money in rent.

There are advantages from buying from both places. Obviously Tony has the price advantage. Optimo has the advantage of (Probably) having a hat in each color IN STOCK for you to look at. Optimo could have at least one hat in each style in each color for people to try on. etc.

I heard of a gun shop that kept one of each of the Remington and Browning guns that they could sell, they let the customer's go out back and try them out, then when they found what they like, they ordered them one. That seems to be a good business model for a hat store chain in some ways.

By the way, I own one of Tony's hats, but have NEVER been to Optimo...

 

[newturnofphrase]

And I think the rule of diminishing marginal utility applies with each additional dollar spent on hats...just as it does with the money spent on most other consumer product. One might experience a large jump in quality per additional dollar spent when choosing between a thirty dollar Wal-Mart woolie and a one hundred dollar Imperial Akubra. And maybe not quite so much increase in quality per additional dollar when choosing between an Imperial Akubra and a Deluxe Akubra...and maybe even less between the Deluxe Akubra and some customs.

AF

Correct analysis WRT diminishing marginal return (not utility) for added expense. A fur felt hat is a quantum leap in quality over a wool hat, regardless of manufacturer, as anyone who has compared wool felt and fur felt can attest to. But the difference between a XXXXXXXetc beaver felt and a XXXX beaver is pretty negligible. Sometimes the improvement in quality is not even visible or detectable in any significant way, yet the price differences can be enormous.

My understanding of diminishing marginal utility is that it would be more applicable to collecting 2 hats verses collecting 400 hats. The collector that has 2 hats sees a significant marginal utility with the purchase of an additional hat (he now has a third hat to wear on his rotation, though it reduces the overall utility of his other two hats as they get worn less often), perhaps in a style he doesn't have, than for the collector with 400 hats in all styles, where the utility of adding on one more is negligible since he may not even wear all his hats in the span of a year. A good example of this problem is the rapper Tpain, who accumulated over 200 top hats in various styles, yet couldn't possibly have gotten much utility out of most of them relative to the amount of utility he got from each when he only had one or two.

Edit: The above analysis might be more appropriate in a thread labeled "economics of hat collecting."

 

[Undertow]

Let me also add that if any of you wool hat enthusiasts (who are not ethically/morally opposed to fur) would like to test out a fur felt, you need only pop into your local antique stores.

For instance, I have a place I go where the owner regularly hits estate sales. I purchased a real nice Dobbs from her for $35. Her and I were able to date the hat to the 1950's. The felt is lightweight, supple, creases well; the hat was in immaculate condition having sat boxed for the last 5 decades. The fur felt on that hat is definitely superior to some of my modern Stetsons which all seem a bit clunky in comparison.

Granted, I'm in the middle of Iowa (we're already 10 years behind everyone else), so I'm pretty fortunate to find those kinds of hats. But if you're industrious, you can find some good deals too that would give you chance to have great fur felt under $50.

 

[jamespowers]

Correct analysis WRT diminishing marginal return (not utility) for added expense. A fur felt hat is a quantum leap in quality over a wool hat, regardless of manufacturer, as anyone who has compared wool felt and fur felt can attest to. But the difference between a XXXXXXXetc beaver felt and a XXXX beaver is pretty negligible. Sometimes the improvement in quality is not even visible or detectable in any significant way, yet the price differences can be enormous.

My understanding of diminishing marginal utility is that it would be more applicable to collecting 2 hats verses collecting 400 hats. The collector that has 2 hats sees a significant marginal utility with the purchase of an additional hat (he now has a third hat to wear on his rotation, though it reduces the overall utility of his other two hats as they get worn less often), perhaps in a style he doesn't have, than for the collector with 400 hats in all styles, where the utility of adding on one more is negligible since he may not even wear all his hats in the span of a year. A good example of this problem is the rapper Tpain, who accumulated over 200 top hats in various styles, yet couldn't possibly have gotten much utility out of most of them relative to the amount of utility he got from each when he only had one or two.

Edit: The above analysis might be more appropriate in a thread labeled "economics of hat collecting."

Correct. Marginal Return versus Marginal Utility.
Both are however different for each individual.

 

[newturnofphrase]

Correct. Marginal Return versus Marginal Utility.
Both are however different for each individual.

Oh but of course they are. And utility can be defined in many ways.

 

[jlee562]

Hi

Well, you DO get what you pay for, but IN THEORY Tony B can sell EXACTLY the same hat as Optimo in downtown Chicago for say 40% of what Optimo has to have for it because Tony is selling "from his Mother's basement" while Optimo has to pay large sums of money in rent.

There are advantages from buying from both places. Obviously Tony has the price advantage. Optimo has the advantage of (Probably) having a hat in each color IN STOCK for you to look at. Optimo could have at least one hat in each style in each color for people to try on. etc.

I heard of a gun shop that kept one of each of the Remington and Browning guns that they could sell, they let the customer's go out back and try them out, then when they found what they like, they ordered them one. That seems to be a good business model for a hat store chain in some ways.

By the way, I own one of Tony's hats, but have NEVER been to Optimo...

Tony can get felt from FEPSA, but he can't get Optimo's felt colors.

 

[jamespowers]

Oh but of course they are. And utility can be defined in many ways.

Which makes it different for each individual. If you could come up with a blanket statement then you could make a fortune.

 

[1961MJS]

Tony can get felt from FEPSA, but he can't get Optimo's felt colors.

Hi JLee, True, but Tony COULD do the same thing (Buying Custom felt) and still be substantially less expensive. The big cost driver would be the store.

Later

 

[newturnofphrase]

Another one bites the dust [huh]. I found out that the Christy's stiff wool felt bowler was discontinued this year. So no more brown or grey formal-quality Christys bowlers anymore. Only the black fur felt and the costume-quality soft fashion bowler.

It makes sense from a purely economic standpoint because anyone who wants the hard wool felt hat would rather buy a fur felt than a crappy soft fashion bowler if they couldn't get the wool, and anyone looking for a cheap accessory isn't going to buy the more expensive version of the wool bowler anyway. I doubt the manufacturing cost difference is much between them, but they had to sell the wool at a significant discount for anyone to buy it relative to fur. Now anyone wanting a bowler will just pay the marginally higher price for a fur felt and Christys' should make more money overall. Christys should capture almost all of the former stiff wool bowler market with their fur felt bowler.

Makes me sad, however, because the tradeoff is that you'll no longer be able to get Christy's bowlers in grey or brown. Presumably sales of these were low enough that they will still profit more by discontinuing them. But anyone wanting one should act soon as re-seller's stock will quickly run out, especially in larger sizes.

Christys seems to be repositioning their high quality bowler line to appeal mostly to the equestrian market, which is worrisome because they already have the extra firm bowler in that category. Makes me wonder: will the iconic Christy's bowler go the way of the dodo?

 

[danofarlington]

My problem with brick and mortar shops is that they usually seem to pick out styles of men's dress hats that I don't like. For example, all Stetsons and no Borsalinos. Or the Borsalinos they carry are not the ones I want. Exceptions to this would be Worth & Worth in New York--small selection but they have styles I like--and what I imagine Delmonico's would be in Connecticut, or what I imagine Village Hat Shop would be in San Diego, or what I imagine Salmangudi would be in Boston. The custom hatmakers are excepted. I would love to visit Tony's, Art's, Dave Brown (Rochester) and Gary the custom hatter in wherever that is, Buffalo I guess, as well as that SW Virginia hatmaker that goes without mention but whom I admire.

 

[tonyb]

My problem with brick and mortar shops is that they usually seem to pick out styles of men's dress hats that I don't like. For example, all Stetsons and no Borsalinos. Or the Borsalinos they carry are not the ones I want. Exceptions to this would be Worth & Worth in New York--small selection but they have styles I like--and what I imagine Delmonico's would be in Connecticut, or what I imagine Village Hat Shop would be in San Diego, or what I imagine Salmangudi would be in Boston. The custom hatmakers are excepted. I would love to visit Tony's, Art's, Dave Brown (Rochester) and Gary the custom hatter in wherever that is, Buffalo I guess, as well as that SW Virginia hatmaker that goes without mention but whom I admire.

Say this for Byrnie Utz: They certainly have variety. Whatever the hat nuts (er, aficionados) here might think of modern factory produced hats, Seattle's storied hat retail shop has 'em in just about every commonly available style and color, and several less common ones as well, low-end to high and all stops in between. Should you ever get out this way, Dan, you really ought to check it out, if for no other reason that to see a hat retail shop that looks pretty much as it did when it opened nearly 80 years ago.

 

[Gin&Tonics]

Let me also add that if any of you wool hat enthusiasts (who are not ethically/morally opposed to fur) would like to test out a fur felt, you need only pop into your local antique stores.

Alas, I wish this were really true for everyone. I am a passionate lover of all things antique, so whenever I get the chance, I peruse any antique store I can find. Sadly I have never seen a felt hat for sale in any of them, ever. It seems to be dependent on where you live what sort of things you will find in antique stores. The ones around here don't seem to carry such things.