- Messages
- 10,880
- Location
- vancouver, canada
The custom hat business is not your standard business. Even the lowest priced hat maker (me) can turn a profit selling beaver felt hats. I agree that keeping one's over head is critical but the felt chosen just provides the base line from which a mark up is attached. In the hat making business the ceiling is very high as all hat makers are using identical products purchased at the same price (save for the proprietary Optimo felts). A beaver felt will run you $150 to $235 and sell for $350 to $1300. With that there is no impediment to beaver as the same dynamics hold as they do for rabbit at $65 to $100 and sell for $250 to $500. With beaver felt there is more potential for profits than there is for rabbit. And considering your other fixed costs; rent, heat, taxes, then beaver would likely make more sense as a choice as there is more potential for profit.My accounting friends tell me reducing fixed costs is a key ingredient to profits and staying in business.