Garment Costing: How to Calculate Garment Cost using available Information


Garment costing

Question:  I am a merchandising management student, I want to know how to calculate the cost of a garment using following details.

1. Fabric consumption: 0.8 yards per garment.
2. Fabric wastage allowance 3%
3. Fabric price: $2.7per yard.
4. Total charges for insurance & fright $ 0.3 (per yard). Fabric is being ordered from Hong Kong.
5. Finance charges for fabric purchasing is 15%.
6. Trim cost: $ 1.5 per garment (excluding thread cost).
7. 5000 meter of thread cones being used for sewing, 210 meters of threads needed for a garment and the price of a thread cone is $6.
8. Garment SMV is 40.
9. Labor rate: the selling price of a minute is $ 0.03

... by OCS reader.

To calculate the cost of the garment, I will first create a table in excel sheet. Then I will calculate material cost and labor cost. Finally sum up all cost together to calculate total cost of the garment. In the following I have shown you step by step process for calculating cost of the garment using information provided on the above.

Step 1: Arrange information in the excel table, provided on the above problem. See the following table, where I have arranged all required information to find final garment cost. I have given code number to each information A, B, ...J.
I added extra rows where I need to calculate something to calculate sub costs and necessary information. Like M, N, O and P.  

Step 2: Calculate total fabric consumption including wastage percentage (M)
Total fabric consumption per garment = Calculated fabric consumption (1+Wastage%)
Or M=A(1+B)

Step 3: Calculate fabric cost per garment (N): Factory has incurred cost in insurance and freight and finance charge. I have calculated fabric related cost together. 

So, Fabric cost per garment (including freight and finance charge) = (M*(C+D))+(M*C*E)

Step 4: Trim cost: Total cost of the trims has been given.  

Step 5: Calculate thread cost (O): From the thread rate (unit 5000 meters) and thread consumption, thread cost per garment is calculated. 
Here thread cost per garment = G*H/5000

Step 6: Calculate labor cost per garment (P): Labor cost per garment is calculated using garment SMV (standard time) and labor cost per minute.

Labor cost per garment (P) = Garment SMV * Labor cost per minute

Step 7: Calculate total garment cost (GC):
I have calculated all sub costs required to find total garment cost. 
Total garment cost = (Fabric cost + Trim cost + Thread cost + Labor Cost)
Total garment cost = ($2.81 + $1.50 + $0.25 + $1.20) = $5.76



You may also like


5S,3,apparel industry,56,apparel news,33,Apparel Production,30,Apparel Software,15,Bamboo Fabric,1,Bangladesh,1,Blogs,1,Books,30,Business Guides,9,Buyer,1,Buying House,4,CAD/CAM,1,Calculation & Formula,1,career,33,Change Management,1,Clothing,1,Clothing Brand,3,Compliance,3,Consumption,4,Costing,7,Cutting,17,Denim,3,Directory,3,Dyeing,1,eCommerce,1,Education,5,Event & Fair,14,Fabric,70,Fashion,5,Fashion Business,36,Fashion Design,3,Fashion Show,1,Fiber,1,Finishing,10,Garment Exporters,1,Garmenting,1,Gartex,1,Guest Post,8,Human Resource,2,Industrial Engineering,208,Infographic,5,Knitting,3,Kurti,1,Lean,27,Line layout,3,Machines,28,Manufacturing,51,Merchandising,101,MIS,23,MISC,20,Operation bulletin,14,Operator,1,Performance rating,1,PLM,2,Printing & Embroidery,11,Problem Solving,1,Production Planning,26,Project Report,1,QNA,120,Quality,61,Quality manual,2,Quality system,14,Resources,42,Retailing,3,Salary & Wages,7,Sampling,22,Scheduling,3,Sourcing,8,Spec Sheet,9,Sportswear,1,Stitching,3,Store,2,Stretch fabric,1,sustainable clothing,7,T-shirt,3,Tailor,1,Tailoring Shop,2,Technology,56,Texprocess,1,Textile processing,11,Textile testing,21,Textiles,41,Threads,1,Towel,1,Trims & Accessories,15,videos,11,Waste,1,Work Study,38,Yoga wear,1,
Online Clothing Study: Garment Costing: How to Calculate Garment Cost using available Information
Garment Costing: How to Calculate Garment Cost using available Information
Garment costing
Online Clothing Study
Loaded All Posts Not found any posts VIEW ALL Readmore Reply Cancel reply Delete By Home PAGES POSTS View All RECOMMENDED FOR YOU LABEL ARCHIVE SEARCH ALL POSTS Not found any post match with your request Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS CONTENT IS PREMIUM Please share to unlock Copy All Code Select All Code All codes were copied to your clipboard Can not copy the codes / texts, please press [CTRL]+[C] (or CMD+C with Mac) to copy