The Economics of Streetwear

​Although streetwear looks complex in designs, its economics follows the old school theory of demand and supply. Now here, what we mean by the traditional demand and supply method is when a company only manufactures a limited number of products which aren’t restocked even when the demand for it is sky-high. Coming to the other sectors of the economy, every product released by a brand encounters a direct relationship between their demand and supply; that is, the stock released in the market is influenced by their demands. A manufacturer tries to supply its products according to demand. Although the principle followed by the streetwear companies might seem mystifying on the surface level, when probed deep, it turns out to be one of the best techniques of making colossal profits. 
Let's take the brand Supreme for example. Before releasing its merchandise, the company reaches out to its target audience by creating hype through advertisements and publicity on social media. Also, mostly it is the social media influencers and celebrities who help in announcing the arrival of it on a particular date and report on its utilities. These days, almost every item is available on the brands’ website and in case of the streetwear products; the number of those objects handed over to the stores for resale is even lesser than the numbers obtainable from the website. Therefore, the consumers are alarmed about the date and time of the sale beforehand, so that nobody misses out on a chance to purchase it. The brands know that however much their products are priced at, all of them will be sold out in no time and there is no chance of facing a loss. Moreover, making fewer products available in the resale stores also stretches their profit margin and their demand. 
The streetwear economy performs in a way similar to that of the limited edition products released by certain brands from time-to-time. The only and most crucial difference, in this case, is that sometimes, the limited edition products come out once in a while and share similarities with their already existing label with certain changes here and there or are remodeled after having collaborated with other brands or pioneer celebrities; while in case of the streetwear products, the whole collection qualifies to be considered “limited” and is one of its kind. An interesting fact put forward by statistics shows that for some brands it only takes a few seconds to sell off all their products available on their website and there is no chance of getting them back in stock. Once all the merchandise is sold out, the buyer has to wait for quite some time before getting his hands on the company’s next release. 
It is a common belief that when a thing has a veil of mystery and value encumbering it, its demand automatically rises. The street fashion has attained soaring success in recent times clearly by taking a course to this policy. What matters here is the value of the product, and to justify its badge of being exquisite, only a restricted number of products are brought into the market thereby elevating both its demand and price and also maintaining it despite their periodic release.