Unit Economics: €30 Dress vs. Made-to-Measure Dress

Pillars: Strategy & Economics

Blog type: Educational

Estimated reading time: 5–10 minutes

By Valentin – September 16, 2025

TL;DR

• EU fashion e-commerce return rates typically 22–58%; each return adds ~€1.5–€3.5 in processing before markdown risk. [Source: Prime AI, 2025; Masson International, 2025]

• Textile EPR adopted: 20 months to transpose, 30 months to implement. [Source: European Parliament, 2025]

• At €30 retail, payment fees + pick-pack + returns + CAC compress contribution; ultra-low FOB is survival, not a choice.

• A made-to-measure dress with ≤5% returns (Assumption) shifts value to cost per wear; wear-frequency beats ticket price.

Set-Up: why the math changed

Two structural shifts: (1) EU lawmakers approved textile extended producer responsibility; producers must fund collection, sorting, and recycling. Member states have 20 months to transpose and 30 months to stand up schemes. [Source: European Parliament, 2025]
(2) Volumes remain high: in 2022 the average EU citizen bought ~19 kg of clothing/footwear/home textiles; textile waste ~12.6m tonnes/year and <1% recycled into new textiles. [Sources: EEA, 2025; European Parliament, 2025]

Thesis (testable). Because returns and EPR fees compress margins at €30 retail, EU shoppers cut cost per wear by ~20–40% with a made-to-measure dress that holds ≤5% returns (Assumption) and delivers ≥40 wears (vs 10–15 for many fast-fashion dresses).

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€30 Dress Unit Economics: fees, returns, FOB sensitivity

Benchmarks. Payment processing ~2.4–3.0% of the charge (model 2.8%). Pick-pack typically €1.0–€4.5 per order (single-SKU apparel near the low-middle). Returns processing often €1.5–€3.5 per item, excluding any return-shipping subsidy and markdown risk. [Sources: ClearlyPayments, 2024; Masson International, 2025; AMZPrep UK, 2024]

Returns reality. EU apparel online return rates commonly 22–58%, driven by bracketing and liberal policies. [Source: Prime AI, 2025]

Mini-calc (per 100 orders at €30, before EPR; fees on gross).
Assumptions: payment fee 2.8% on €3,000 = €84; pick-pack €2.50/order = €250; returns processing €2.50/return; markdown loss on returned units 15% of COGS; COGS (FOB+inbound) sensitivity €5.5/€7/€9; CAC sensitivity €3/€6/€9 per order (illustrative bands). If processors refund some variable fees on refunds, effective fees drop toward ~€60; result shifts by ~€0.24/order (Assumption).

Per-order contribution (€) across return rates and CAC, COGS = €7.00

Mechanism: as returns rise, net revenue drops, while pick-pack on initial shipments and return handling remain. To protect contribution per order, the €30 model must force very low COGS, maximize SKU velocity, and overproduce winners to cover losers. [Source: Harvard Business School Working Knowledge, 2023]

COGS note (assumption with sensitivity): Low-cost woven dresses from high-volume suppliers can land in the €5.5–€9.0 COGS band at 10k+ MOQ, depending on fabric and trims. The table shows why the outcome is returns-driven even before CAC/EPR; pushing COGS lower helps but does not fix a 30–50% return rate.

Mechanism: bracketing + SKU velocity (why €30 “works” only at scale)

The launch-test-reorder model (LATR) probes thousands of SKUs, scales only the winners, and treats high returns logistics as a tax on speed. Bracketing (multi-size/colour trials in one order) inflates returns but helps the platform discover fit-winners fast enough to recycle capital into the next drops. [Sources: Prime AI, 2025; HBS Working Knowledge, 2023]

Made-to-Measure Dress: returns, wears, cost-per-wear

Process (Assumption; Cori Tailor): Atelier in Iași, Romania; made-to-order (no stock); typical lead time 10–15 business days from confirmed measurements; alterations over returns; historical return rate target ≤5%. Unit time breakdown: pattern adjust 45–90 min; cut 30–45; sew 180–300; finish/QC 30–45 → ~4.75–8.5 hours total depending on style and fiber.

Utilization (wears). Clothing use declined ~40% over 15 years; some EU sources cite 7–8 wears averages—consistent with lower utilization for trend items. [Sources: Ellen MacArthur Foundation, 2019; EEA, 2022]

Cost-per-wear comparison (inputs explicit):

• Fast-fashion €30 dress at 8/12/15 wears → €3.75/€2.50/€2.00 per wear.

• Made-to-measure €160 dress at 40/50/80 wears → €4.00/€3.20/€2.00 per wear.
  Crossover happens fast: at ≥50 wears, MTM undercuts many €30 options. Returns friction is also lower (≤5% vs 22–58%), reducing re-ordering churn. [Source: Prime AI, 2025]

Want the operational detail? See how our made-to-measure process works.

Regulatory risk: EPR fees in practice

The new EU rule moves end-of-life costs to producers. A concrete fee band already exists in France’s textile EPR: women’s dresses = €0.0467 per item on the detailed scale (2024), while a simplified declaration for small/low-traceability sellers is €0.4791 per clothing item. Per 100 dresses, that’s €4.67 vs €47.91—a tenfold swing if you skip traceability. [Source: Refashion, 2024]

At EU level, member states must implement schemes within 30 months of entry into force; fees may be eco-modulated (e.g., durability) and may explicitly address ultra-fast fashion in contributions. [Source: European Parliament, 2025]

Implication: high-volume, thin-margin models multiply EPR exposure; fit-to-order lowers unit throughput and returns, trimming total fees paid per kept wear.

Case Example: 18-month shopper math

Shopper A (fast fashion): Buys 6 dresses × €30 = €180. Keeps 60% (returns 40%). Kept items used 12 times each.

• Wears = 6 × 0.6 × 12 = 43.

• Cost per wear ≈ €180 / 43 = €4.19.

• Return handling and re-order time not included.

Shopper B (made-to-measure): Buys 1 dress at €160. Returns risk 5% (Assumption); used 50 times.

• Wears = 50.

• Cost per wear = €160 / 50 = €3.20.

Result: with realistic returns and wear-frequency, MTM beats the €30 path on €/wear over one season plus.

Counterarguments → Rebuttals

“Made-to-measure is too expensive upfront.” Upfront price misleads. €160 at 50 wears = €3.20/wear vs €30 at 12 wears = €2.50/wear—close even before factoring ≤5% vs 22–58% returns. Past 50–60 wears, MTM typically wins decisively. [Source: Prime AI, 2025]

“I don’t want to wait weeks.” 10–15 business days eliminates bracketing and enables first-fit success. That’s fewer returns, fewer re-orders, more wears sooner.

“What if the fit is wrong?” Alterations are measured in minutes; reverse logistics adds pick-pack, transport, inspection, repack, and markdown risk per item.

Credible counter-example: A €30 outlet dress with ~5% returns can work offline. But the outlet trades low CAC for rent/payroll, limited assortment, and local footfall; it doesn’t scale like EU-wide e-commerce where returns + CAC + EPR dominate unit economics.

Practical Takeaways

• When you see €30, ask: what return rate is assumed and who pays the returns logistics? [Source: Prime AI, 2025]

• Track cost per wear, not ticket price; target ≥40 wears for special-occasion pieces; MTM fit helps you hit it.

• EPR is no longer hypothetical: implementation clocks are running (20/30 months). Budget per-item fees and ensure traceability to avoid the simplified-tariff penalty. [Sources: European Parliament, 2025; Refashion, 2024]

• Learn what “slow fashion” actually means in practice for returns and wear-frequency.

• Prefer vintage-inspired designer dresses with proven silhouettes; they sustain utilization (wears).

Conclusion

“€30 is only cheap if most people don’t keep it.” The dominant model depends on bracketing and SKU velocity to offset high return rates. Fit-to-order flips the math: more minutes per unit, far fewer returns, higher utilization, lower €/wear, and less exposure to EPR volume.

CTA

Cut €/wear with fit that lands first-time. See how our made-to-measure process works.

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Assumption used in this analysis (once): Cori Tailor MTM return rate ≤5%; lead time 10–15 business days; unit time ~4.75–8.5 h per dress.

References

• European Parliament. “Parliament adopts new EU rules to reduce textile and food waste.” Sept 9, 2025.

• European Environment Agency (EEA). “Circularity of the EU textiles value chain in numbers.” Mar 26, 2025.

• Prime AI. “Clothing return rate benchmarks by country and category.” 2025.

• ClearlyPayments. “Statistics on how much merchants pay for payment processing in 2024.” Aug 14, 2024.

• Masson International. “Understanding 3PL Costs in Europe.” Jun 5, 2025.

• AMZPrep Europe. “UK 3PL Cost Calculator.” Dec 2024.

• Refashion (France). “2024 eco-fee scale.” Jan 1, 2024.

• Harvard Business School Working Knowledge. “How Shein and Temu Conquered Fast Fashion—and Forged a New Business Model.” Apr 25, 2023.