The Business of Shaving

Recently a friend (high school classmate, now a Facebook friend whom I've not seen since high school) posted a status update that afforded a glimpse into his exploration of the art of shaving (the straightforward meaning of that phrase, not the Website of that name).  I was intrigued.

Over the years I've used everything from the old fashioned safety razor, holding a single blade that, in my youth, cost 10¢ to the current high-tech cartridges that have five blades and cost upwards of $4.

I've also used electric shavers from all of the major manufacturers.

[I will briefly dispense with the electrics.  Battery

life, meaning how long the battery lasts until it will no longer hold a charge, meaning it's no longer a cordless rechargeable, is pathetic.  Keeping the blades sharp and lubricated, finding the right pre-shave conditioner to suit one's beard, and developing the technique needed to get the closest and smoothest possible shave are all far more trouble than it's worth.  Even if you are meticulous about all of that and spend $200 for a top model, you still cannot get a shave as close and smooth as you can with a blade.]

[I must also say a few words about the old-fashioned straight razor.  I go to a barber who is a traditional Italian practitioner of the art, and he assures me it's far more difficult to learn to use a straight razor on oneself than on a customer.  That, he says, is why the safety razor got its name - and why he uses one on himself.]

The post by Bill (my old friend, a talented writer) piqued my interest.  He was going old school, to the traditional wet shave with a safety razor and shave soap applied with a brush.  Gee, I wondered, was that back-to-the-basics approach economical?

Some prefer exotic materials for the handle
 other than wood, which might not
 stand up to moisture over time.

Well, that depends.  Blades for a safety razor can be had for as little as 25¢ apiece, although the fancy German steel versions cost more than a dollar.  That's still a lot cheaper than $4+ for the high-tech cartridges.  But then what about shaving cream or soap?  Again, you can spend a little or a lot.  You can buy a traditional cream that comes in a tube that costs less than $10 and claims to be enough for 100 shaves when applied in the recommended thin layer.  You can spend $50 for a similar amount of really fancy stuff.  And how are you going to apply it?  With your hand, or a brush?  A shaving brush made of synthetic material is cheap.  Boar bristles cost a good bit more.

Apologies to animal rights activists

The traditional material, introduced by the French centuries ago, is badger hair, and you can spend $200 for an elegant brush with an exotic handle. The aficionados say there is nothing like badger to prepare the beard for the best possible shave.

The most common choice for lathering is the stuff that comes in a can and that every supermarket and drugstore carries, and that will probably cost somewhere around 10¢ a shave, give or take, depending on how much you use.

So, at the cheap end, buy a handle for a few bucks, blades that cost 25¢ apiece in bulk, and the inexpensive shave cream or gel in an aerosol can, and you're probably going to spend about 15¢ a shave.  But so many of us spend so much more.  And big companies like Gillette put a lot of money into marketing to get us to do just that.  They are very successful in getting us to spend more than $4 apiece for their high-tech cartridges.  (The best online price I found for the Fusion Pro-Glide was about $3.50.)
Remember, Gillette is the company that brought us the original

double-edged safety razor blade, patented in 1904 and supplied to American troops in World War I.  But Gillette does a lot of research on design, and their engineers are quite convinced that each advance, adding blades up to their current five-blade design, has meant a better shave: smoother, closer, easier, faster, less dependent on perfect technique, and with less irritation.  If you shave every day and put in a new cartridge every week, which is a common pattern, you'll be spending 50¢ a shave just for the blades.  Some men use a cartridge far longer than a week, but I can tell the difference between shave #1 and shave #7, so I find the weekly routine sensible.

With a bit of guidance from my friend Bill, I learned that there are others selling competitive cartridges for less.  And that made me wonder: are they really as good?  How can that be?  If they are sacrificing nothing in quality of materials and manufacturing process, if they are attentive to quality control and spending enough on marketing to have a successful business model, how can their product be that much cheaper?  It has to be profit.  And my regular readers know how I am fascinated by profit and the profit motive.

In my online research I have found two companies making razors and cartridges clearly intended to compete with Gillette's top-of-the-line Fusion Pro-Glide model. Both of them cost about a third less.  I have tried out one of them and have judged it to be of comparable quality and performance.  That made me really keen to investigate profit.

An article published in 2009 gave me some answers.  The Gillette Fusion Pro-Glide cartridge costs less than 10¢ to manufacture.

Add another few cents for packaging.  Each cartridge brings about $2.50 in profit for Gillette and another 75¢ profit for the retailer.  Of course there are some distribution costs.

But even considering the cost of research and development, that per-cartridge profit for Gillette is eye-popping.  It's no wonder that Gillette is the most profitable division of parent company Procter & Gamble, with a profit margin upwards of 30%. Gillette makes Big Pharma look like pikers.

I was raised by parents who belonged to labor unions.
My dad was not quite a socialist,

but he was a staunch believer in workers' rights and the importance of protecting them. And he saw corporate greed almost everywhere he looked. Maybe he sometimes saw it when it really wasn't there, but there is so much of it in America that one really needn't use any imagination to see it around every corner or in every nook and cranny. I'm sure this is why, at least in part, I am always ready to believe that every manufacturer is engaging in price gouging. Very consistently, over the years, my willingness to believe has been supported by cold, hard facts.  This is one of those instances.

But hey, I thought, maybe the undercut-pricing competitors are making their blades overseas, where labor costs are lower, while Gillette's razors are manufactured right here in the good ol' US of A.  Sure enough, Dollar Shave Club, which started up early last year, makes its stuff in Asia.  So what about Gillette, the Goliath to such Davids?  Seven years ago Gillette opened a new facility, which is its largest manufacturing plant for razors and blades in ... Poland.  If you want to help the Poles and think the Asians are already quite sufficiently economically successful without any more help from exports to the US, then go ahead and stick with Gillette.  If you think manufacturing is now global and it really makes no difference, or that you're happy to buy American, but if it's not American it doesn't matter where it's from as long as it's not sweatshop labor, then have a look at the competitors.  (There's another one, called Dorco, for which I cannot vouch, because I have not tried their products, but they certainly deserve mention.)

For me the calculus is simple - so simple that it is not, of course, calculus, but mere arithmetic.  Sacrifice profit to give me a product of equal worth at a lower price, and I will be a customer.

One more thing: don't lie to me.  Last year, convinced - and I wonder what produced this epiphany - that men were dismayed about high prices, Gillette's marketing geniuses initiated a campaign to tell us the cartridges for the Fusion Pro-Glide need be changed only once every 5 weeks.  The obvious goal was to get us to think that the lower-priced alternatives weren't going to save us that much money over time, and that we could get real savings right away just by using the blades longer.  If we all did that, their sales could be cut in half overnight, but they knew that wouldn't happen.  They just don't want to see their two-thirds share of the market shrink.  But when I was using the cartridges for two weeks, I felt a big difference between shave #14 one day and shave #1 the next.  So don't tell me five weeks.

Gillette (and the other big boys) could get serious about the competition and lower their prices.  That's the American way.  Just ask the Walton family.  They could drive their competitors out of business in short order.  Or they could do it the other American way and try to buy them out.  It will be interesting to see how this story unfolds.