Cost per garment is the estimated production cost of one finished unit. It is usually calculated before pricing, margin analysis, break-even planning, and MOQ decisions.
The formula combines the main factory cost components: fabric, labor, trims, packaging, and overhead.
Basic cost per garment formula
This gives the factory production cost per unit. It does not include freight, duties, commissions, marketing costs, taxes, or retail markup.
For the full costing method and detailed formulas, see the garment production cost method.
Fabric cost formula
In the imperial system, fabric consumption is usually entered in yards per garment and fabric price in USD per yard.
Labor cost formula
This converts hourly labor cost into a per-garment labor cost using standard production minutes.
Example: applying the cost per garment formula
Suppose a garment has the following inputs:
- Fabric consumption: 1.40 yards per garment
- Fabric price: $4.00 per yard
- Waste allowance: 8%
- Labor rate: $18.00 per hour
- Standard minutes: 9 minutes per garment
- Trims cost: $0.65 per garment
- Packaging cost: $0.40 per garment
- Factory overhead: 12% of direct cost subtotal
In this example, the estimated cost per garment is $10.98.
Components included in the cost per garment formula
- Fabric consumption and fabric price
- Fabric waste allowance
- Labor rate and production time
- Trims and packaging
- Factory overhead as a percentage or fixed amount
Common mistakes when applying the formula
- Using fabric price without adding waste allowance
- Mixing yards, meters, inches, or centimeters incorrectly
- Using hourly labor rate without converting it to minutes
- Forgetting trims, packaging, or overhead
- Adding commercial costs into factory production cost too early
Calculate cost per garment
Use the Production Cost Calculator to calculate fabric, labor, trims, packaging, overhead, and total cost per garment.