How to Calculate Sweater Costing in Buying House

By | August 22, 2015

How to Calculate Sweater Costing in Buying House

Mayedul Islam
Merchandiser at Fashion Xpress Buying House.
Badda, Dhaka, Bangladesh.
Email: [email protected]

 

Introduction:

Costing is an important fact in garments manufacturing sector. Whole business is totally depends on it. Accurate costing can increase the growth of a business. As its importance in garments merchandising, today I will present sweater costing calculation method in this article.

Sweater Costing

Sweater Costing

Costing Calculation Method of Sweater Costing (Buying Costing):

Before starting sweater costing, a sweater garments merchandiser should confirm the following items:

  1. Yarn Cost per lbs,
  2. Embroidery Cost per dozen,
  3. Printing Cost per dozen,
  4. Accessories Cost (Zipper, button etc.),
  5. Washing Cost per dozen,
  6. Cost of Making (CM) per dozen,
  7. Commercial Cost per dozen,
  8. Others Cost per dozen.

The very next duty of a sweater garments merchandiser is to determine the yarn consumption and costing.

Yarn cost can be calculated by using the below formula:
[{(Garments weight in lbs per dozen) + wastage %} × Yarn price per lbs]

Generally we have added 10-20% wastage depends on styling.

In this stage, all the others necessary cost should be added with total yarn cost to achieve total cost of a garment.

Now, one example is presented in the below to clear all the confusion about the above discussion.

Example:

Suppose,
The buyer “CK” forwards a sweater order to you by mentioning the following terms:

  • Yarn: 100% Acrylic, 2/36”S
  • Weight: 195gm (2ply)
  • Knitting: 12 GG plain knit in body, (2×2) Rib at bottom and sleeve opening,
  • Specifications: Plain knit placket, 2 pockets.

Now, find out the garments costing of the above order.

Solution:

Let,

  • Yarn Cost per lbs- $5.00
  • Embroidery Cost per dozen- $1.50
  • Printing Cost per dozen-$1.50
  • Cost of Making (CM) per dozen- $25.00
  • Washing Cost per dozen- $4.00
  • Accessories Cost (Zipper, button etc.)- $4.00

Now,
Yarn costing per dozen garments:
As garments weight is 195gm for 1pc then for 1dozen garments, yarn needed (195 × 12)

= 2340gm

= 5.16lbs    (1lb = 453.6gm)

After adding 10% wastage, total yarn needed- 5.68lbs

So, yarn cost per dozen stands at- $(5.00 × 5.68) = $28.38

By adding all the following costs with total yarn cost, we will get the total FOB cost of garments per dozen.

  • Yarn cost per dozen …………………………… $28.38 ……………………. (A)
  • Printing Cost per dozen ………………………..$1.50 …………………… (B)
  • Embroidery Cost per dozen ……………… $1.50 ……………………. (C)
  • Accessories Cost per dozen …………………..$4.00 …………………… (D)
  • Washing cost per dozen ……………………… $4.00……………………… (E)
  • Cost of making (CM)……………………..….$25.00 ………………….. (F)
  • Commercial cost …………………………….…. $1.00 ………………. (G)
  • Others cost …………………………………………$0.50 …………….. (H)

So,
Total FOB cost per dozen = (A + B + C + D + E+ F + G + H)
= $ (28.38+ 1.50+ 1.50+ 4.00+ 4.00+ 25.00+ 1.00+ 0.50)
= $65.88 per dozen.

In buying house costing, profit% for the buying house (here-20%) should be added with total FOB cost per dozen.

So,
Total FOB cost per dozen with profit% stands at ($65.88 + 20%) = $79.10

Now, total FOB cost per pcs is ($79.10 / 12) = $6.56

So, in the view of buying house costing (FOB) per pcs garment is $6.56

Speech from the writer:
This article only shows the sweater costing calculation method. Don’t be disappointed about its result. All the numbered used here for completing the calculation only. So, please, don’t make any comment about the calculating result. You can pass your comment, advice just about the calculating method.

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