Product Costing
It goes without saying that the simplest garments cost less to make. As
styling details are added; pockets, fancy seaming, linings and trims
etc, the cost of the finished garment will increase in labor cost in
production. If you have chosen an expensive fabric for one of your
designs, it would be wise to keep the details to a minimum. Using
expensive fabric and many styling details often makes the finished cost
of the garment too high for the market which has been targeted. Costing
a garment is a formula; figuring costs of fabric and trimmings with
labor plus business overheads and profit is a mathematical equation.
Overhead costs are affected by such factors as design research,
markdown sales losses, brand advertising, promotions, rent, and
everything else that goes along with owning and running a business.
This all has to be calculated into the costing of a garment. The cost
of piece goods (fabric) is generally about one-third the initial
production cost of a garment. Ultimately the final figures may be a
subjective call of what the market will bear. If you price your
garments higher than comparative garments sold in stores that you have
targeted for your product, you will find that your clothes will be left
on the rack! For the small company, the mark-up will be higher than for
bigger mass-producing companies that have a lower mark-up percentage
due to the volume they manufacture.
