GARMENT COSTING

COSTING TECHINIQUES IN APPAREL INDUSTRYDone byR.Mahendiran,B.Tech,M.B.AKovego Clothing Industry Tirupur

IntroductionIn order to achieve perfect garment costing, we must know about all the activities including raw materials, processing techniques, purchase of Accessories, sewing, packing, transport, overheads, etc and also about their costs, procedures, advantages and risk factors.

Contd.,Costing is the deciding factor for fixing of prices and the important thing to follow in all stages like purchase, production, marketing, sales, etc.

FACTORS TO BE CONSIDEREDCosting includes all the activities like purchase of fabrics and accessories, processing and finishing of fabrics, sewing and packing of garments, transport and conveyance, shipping, over heads, banking charges and commissions, etc.

Garment Costing SheetCOST SHEETProductLADIES JACKETBRUSHED FLEECEStyle no:074EF1Y072CountryUSABuyer:WALLMARTFabricFRENCH TERRYGSM260

Fabric CostingParticularsDetailsAmount (INR)Yarn PricePer Kg250Knitting chargesPer Kg15Greige Fabric CostPer Kg265Average dyeing cost100Weight loss on dyed fabric:10.00%36.5Fleece brushing-8Sub total409.5Interest on yarn prices5.00%12.5Dyed Fabric Cost:422

Garment costingAvg. Fabric Consumption (gram)500211CMTP ChargesCutting:3148.5Stitching:40Finishing:6.5Packaging:4.5Embellishment54.5Trims40Sub Total359.5

Packing materialsTissue10.1Board11.5Hanger10.2H/tag11.5Poly bag11.5Carton1/101.5Label logo20.2Total6.5

EmbellishmentEmbroidery/appliqu120Printing15Lace0.5 Mtr12.5Crochet lace0.2 Mtr17Total54.5

TrimsParticularsConsumptionAmount (INR)M/label11W/care10.5Tag10.5Thread10 Mtr2Twill tape12 cm1.5Mobilon tape30 cm0.5Zipper130Patch label12Button12Total40

Sub Total359.5Overhead cost20.00%71.9Margin (after overhead)10.00%35.95Ratio/Rejection3.00%10.79Total price of a apparel478.14Fob prices: US$Rate: 50.00$ 9.55

Overhead CostCosts those are not directly related to production volume. These are fixed expenses or indirect cost required to operate a business. For example rent of the factory building, administration cost etc.

Costs Are Included Under OverheadList of overheads may vary factory to factory based on organization structure. Building rentSalary of the staffs and associate payroll costsElectricity BillsUtilities (Phone bill, internet bills)

Contd.,Transport expensesExpenses on consumables (Diesel, Chemicals for finishing department)Administration cost (salary and travel cost for the managers, CEOs and VPs),Employee welfare expenses

Contd.,Employee welfare expensesStationary & printing (indirect material cost)Professional and Legal expensesPantry expensesHouse keepingOvertime expenses etc.

THANKS