"Announcing to your customers that prices are going to increase? Are you crazy? You have to do it without warning, it's much simpler! Your prices are low, no one will notice!"
This is pretty much the answer given by every person in the business with whom we have discussed the subject of price increases. And yet, we prefer once again to tell you the truth rather than to present you with a fait accompli. We will not be the only ones and we prefer not to hide anything from you!
Emmanuel, Thomas and Samy
Why will our prices increase in 2022?
There are things we would prefer to see remain the same. There are also things over which we unfortunately have little control. This year, our prices will have to increase, and here are the reasons why.
Fair pricing: a founding value at Hast
Since the creation of the Hast brand, almost 10 years ago, fair pricing has been a founding value of our company. By controlling our costs as best as possible, we have been able, over the years, to offer you honest and affordable prices. Margins are reduced (compared to the traditional fashion industry) in order to always maintain this excellent quality-price ratio characteristic of our positioning.
Year after year, the increase in wages in our workshops, which was perfectly justified, had been offset by the increase in our volumes. In 2022, for the first time, we will have to increase our prices. It is not about increasing our margins but about keeping up with the increase in costs linked, in particular, to the health crisis. We have received dozens and dozens of emails from our workshops announcing sudden increases for several weeks. In line with our logic of transparency, it seems important to us to inform our customers in advance and to explain the concrete reasons for these increases which are necessary to maintain the same level of requirement.
Why this increase?
The health crisis linked to Covid-19 (among others) has put a strain on more than one industry. And the fashion industry is certainly no exception, on the contrary. The numerous slowdowns, lockdowns, restarts and successive production shutdowns have had a number of direct and indirect consequences, including two main ones directly impacting the increase in prices in the textile sector: the freight crisis and the resulting increase in the price of raw materials.
The maritime freight crisis and its consequences on road transport
The freight crisis (price of transporting goods) observed recently is linked to logistical difficulties following the various waves of Covid-19. Containers and ships were in short supply because the various lockdowns, with different and delayed temporalities and geographies, created a fundamental organizational imbalance. Many containers were thus found vacant in ports that were then at a standstill, leaving other maritime areas in high demand waiting. The blockages at regular intervals were extremely complex to manage in logistical terms. Added to this was the disruption of global maritime traffic by the container ship Ever Given, which ran aground for several months in the Suez Canal on March 23, 2021. This crisis had the effect of multiplying maritime transport prices by 3 to 6 times. In the grip of particularly virulent inflation since the start of the health crisis, road transport is not left out since it is undergoing the same disruptions linked to the health crisis: increased demand, increased cost of gasoline, salary negotiations, etc.
Even though our manufacturing is mainly done within the European Union, raw materials come from all over the world (Egyptian cotton, Australian merino, etc.) and the increase in global demand has had repercussions on all markets. Many brands have turned to European workshops to produce their collections, reducing the time available and increasing the costs of our historical suppliers.
Email from a workshop dated 11/15/21
The significant increase in the price of raw materials
According to the economic magazine Capital in an article dating from November 2021, the respective costs of cotton and wool have increased drastically in a short year, by 43% and 47% respectively. Several reasons related or not to the Covid-19 crisis explain these increases. As seen previously, the freight crisis is one of the major causes of the cost increases. But other elements come into play, particularly in the case of cotton.
An important point to consider in the context of the increase in the price of cotton is the impact of the strong recovery in demand after months of harvest and production shutdowns. This recovery inevitably leads to tensions on the production chains that cannot always meet this new demand, in addition to the delays caused by repeated production shutdowns. The strong demand is also explained by a rise in the price of a barrel of oil, leading to a rise in the price of synthetic textiles made from oil such as polyester. Many brands are therefore turning to other materials – such as cotton (so much the better). Finally, there are two other major crises: the climate crisis and the political crisis over the Uyghur issue. The climate crisis has caused many unusual storms, making cotton production less prolific than in past decades. At the same time, the fight for human rights around the forced labor of the Uighur community in China has moved the international community, and pushed many brands to refuse cotton from the Xinjiang region (so much the better). These different factors have put the sector under strong pressure, leading to significant price increases.
Two recent emails from our suppliers
Other raw materials are experiencing similar tensions in the face of poor harvests followed by spectacular returns to demand levels equal to or even higher than those before the crisis began. Wool, linen, cotton, no material is immune to the increase. The same is true for wood, metal, aluminum, etc. and this is having repercussions throughout the production chain.
It is therefore these cumulative increases between the price of raw materials and the price of transport that determine the necessary increase in prices, which we had managed to contain until now. As we said in the preamble, we have chosen to warn you in time so that you can still benefit from the 2021 prices for a few more weeks. We will then continue to do everything we can to offer you excellent value for money, without any compensation!
During the first weeks of 2022, we will offer existing stocks of clothing . The Goût du Sel collection and the permanent pieces already produced and stored will not be affected by the increases in any way. These will come on restockings and collections currently in development, for the reasons we discussed above. Then, rest assured, our prices will increase reasonably and we guarantee that we will maintain the excellent quality-price ratio that characterizes us!
We have chosen to talk about it just before the sales period, without wanting to push you to consume, to announce that it will still be an opportunity to take advantage of our current prices. There will be no reduction but there will be no increase either.
Thank you for reading us!