Garment costing: how to calculate the true cost of a garment
The true cost of a garment is the sum of the raw materials actually consumed, the direct labor at each production stage, machine usage, what you paid sewing contractors (satellite workshops) and its share of overhead. The gap between that figure and the estimated cost on the tech pack is exactly what eats into your margin. Software such as Confeccionando can calculate both.
By the Kondory Tecnología team. Published on , updated on .
What makes up the cost of a garment?
Cost has five components. Each one can be measured per production order and spread across the garments that order produced.
| Component | How it's measured |
|---|---|
| Raw materials | Fabric and materials consumed, at the cost of the lot used, including waste |
| Direct labor | Minutes per stage times the cost per minute, or the amount paid for the service |
| Machine | Minutes of use times the machine's hourly rate (depreciation and maintenance) |
| Sewing contractors | What you paid each workshop for its processes |
| Overhead | Energy, rent, maintenance and administration allocated by cost center |
Why isn't the estimated cost enough?
Because actual production rarely matches the plan. Fabric consumption changes with roll width and waste, stage times vary, and material prices go up from one purchase to the next.
- The tech pack cost is for quoting and setting prices; the true cost is for making decisions.
- Comparing the two by style shows where you are losing margin.
- Without the true cost, a style can sell well and still leave little or no profit.
Costing by service or by the minute?
It depends on how you pay for labor. If you pay per service or per piece, the cost is the service rate for each stage; if you have operators on payroll, it is better to cost by the minute, using the cost center rate for each process.
- By service: simple, ideal when most stages are paid per piece or done by contractors.
- By the minute: more accurate when you have permanent operators, expensive machines and several cost centers.
How does Confeccionando do it?
In Confeccionando, the tech pack calculates each style's cost with materials at lot value (or the yearly average), their waste, fixed cost and the markup factor for the collection, and gives you the price by size group and market.
With the Business plan, each production order also builds up its true cost stage by stage: labor cost per minute from cost centers, machine usage and payments to contractors. You can see the result by stage, by order, by style and per garment.