Cost Analysis In Garment Industry

Cost analysis in garment Manufacturing, as the topic implies, deals with the work of costing a garment which involves the expenses for fabric, trims, cuttings, labor, overhead, sales commission, manufacturer’s profit & transportation. The production cost of the garment must be determined in order to set the wholesale price, the price that retailers’ pay for goods that they purchase from manufacturers.There are two types of costing. The first one is pre cost. Pre cost is the estimate of the garment before it is adopted into the line. The designs must keep the fabric, trim and the labor cost for each garment within the limit set by the company for a particular line price range. Another method is Final cost. It is the exact calculation by the costing or import department using actual figures for materials and labor. The costing Department uses the designer’s worksheet or a prototype garment and the production pattern to analyze material and construction step by step. The designers may be consulted for information or to recommend more practical or cheaper ways to make the garment. Labor Cost may be calculated by time study. In this Case engineer’s time operation such as closing a seam or how long it takes to make an entire garment or a prototype may be sent to a contractor for costing. Cost is varying on quality, style and reliability