How garment costing actually works.
Every quote you receive is built from the same components. This guide takes a cost sheet apart line by line, explains how order quantity moves the unit price, and shows how to work from landed cost to a retail price.
There are no universal numbers in garment costing, and any guide that gives you a figure is guessing about your fabric, your factory and your month. What is universal is the structure. Learn the structure and you can read any quote, compare two quotes honestly, and see which line is worth attacking.
The reasoning below uses ratios and worked logic rather than invented figures. Put your own quoted numbers into the same shape and the arithmetic will do the rest.
See how we quote →At a glance
1. The six components of a unit cost
Every garment quote decomposes into the same six things: fabric, cut and make labour, trims, decoration, packing, and the overhead and margin the factory adds. A seventh, freight and duty, sits outside the factory gate but inside your real cost.
Compare two quotes component by component. A quote that is lower overall but higher on fabric is telling you something different from one that is lower on labour. A supplier who cannot break the number down is either not costing carefully or does not want you to see where the difference is.
- Fabric, cut and make, trims, decoration, packing, overhead and margin
- Freight, duty and inbound handling sit on top
- Always ask for the breakdown, not just the total
- Compare like components, not like totals
2. Fabric consumption is the number to interrogate
Fabric is usually the largest single line, and it is calculated as consumption multiplied by fabric price. Consumption is how much fabric one garment eats, expressed in kilograms or metres, and it depends on the pattern, the size, the fabric width and how efficiently the pieces nest together in the marker.
This is why an oversized tee costs more than a fitted one in the same fabric, and why a small design change can move the price. If a quote looks high, ask for the consumption figure. If it looks low, ask for it too, because an optimistic consumption is the easiest way to make a quote look competitive before reality arrives.
- Consumption times fabric price equals the fabric line
- Pattern shape, size curve and fabric width all move consumption
- Wider fabric usually nests better and lowers consumption
- Ask for the consumption figure, in writing, on both quotes
3. Wastage is real and must be costed
No cutting operation uses every centimetre. Marker waste, end-of-roll remnants, fabric faults and cutting tolerance all mean the fabric you buy exceeds the fabric that becomes garments. A cost sheet adds a wastage allowance on top of net consumption, and a second allowance for rejects at inspection.
Smaller orders carry proportionally more waste, because the same end-of-roll remnants are spread across fewer garments and the marker has less room to nest efficiently. This is one of the structural reasons a fifty-piece run costs more per unit than a five-hundred-piece run, before anyone discusses machine setup.
- Net consumption plus a wastage allowance equals fabric purchased
- Add an allowance for units rejected at inspection
- Small runs carry proportionally more waste
- Complex prints and stripes need matching allowance too
4. Cut, make and trim labour
The cut and make line covers cutting, sewing, trimming, pressing and internal handling. It is driven by how many operations a garment needs and how long each takes. A plain crew tee has few operations. A zip hoodie with pockets, a lined hood, taped seams and multiple bar tacks has many.
That is why construction choices are cost choices. Taped shoulder seams, twin needle coverstitch, contrast bindings and internal finishing each add operations. None of them is wrong; they simply need to be paid for in the retail price. When you need to take cost out of a garment, this line is usually easier to move than fabric, because you can remove operations without changing the fabric hand-feel.
- Cost follows operation count and operation time
- Each construction detail you add is a cost decision
- Simplifying construction is often the cleanest saving
- Setup time is spread across the run, so it hurts small runs most
5. Trims, decoration and packing
Trims are the physical extras: thread, elastic, drawcords, tippings, eyelets, zips, buttons, interlining, woven labels, care labels and size tabs. Individually small, collectively significant, and often with their own minimums, which is why a custom zip pull on a fifty-piece order can carry an awkward cost.
Decoration costs differ by method and by run length. Methods with a per-unit machine cost and little setup suit short runs; methods with a setup cost per colour or per screen reward longer runs. We run DTG, DTF, sublimation, puff, HD, embroidery and appliqué in house, with screen printing through vetted partner units managed by our QA team. Packing covers polybags, hangtags, folding, cartons and labelling, covered in the labels and packaging guide.
- Trims often carry their own minimums: check them early
- Setup-heavy decoration rewards volume; per-unit methods suit short runs
- Embroidery is costed by stitch count, so simplify dense artwork
- Packing is a real line, not an afterthought
6. How MOQ moves the unit price
Some costs are fixed per order and some are variable per unit. Fabric is close to variable. Pattern making, marker making, machine setup, screen or plate preparation, and the first inspection are close to fixed. The unit price is variable cost plus fixed cost divided by quantity.
That single sentence explains the whole MOQ conversation. Doubling the quantity halves the fixed share per unit, so the price falls, but it falls with diminishing returns: the move from a very small run to a moderate one is dramatic, and the move from large to very large is marginal. It also explains why a low minimum is worth paying for. A higher unit price on 50 pieces per style per colour risks far less cash than a lower unit price on a quantity you have not proved you can sell.
- Unit price equals variable cost plus fixed cost divided by quantity
- The steepest savings come at the small end of the curve
- Extra colours multiply fixed costs: each colour is its own run
- A lower price on unsold stock is not a saving
7. From landed cost to retail price
Landed cost is what a saleable unit actually costs you in your warehouse: the ex-factory unit price, plus freight, duty and clearance, plus inbound handling, divided by the units that arrive saleable rather than the units you ordered.
To set retail, work from the gross margin you need rather than from a multiplier you heard. Decide what percentage of the selling price must remain after cost of goods to cover payment fees, shipping to the customer, returns, marketing and your own time. Divide landed cost by the remaining fraction to get the price before tax. If you sell wholesale as well, check that the same landed cost still leaves a workable margin at wholesale terms, because a retail-only price rarely survives being halved.
- Landed cost includes freight, duty, handling and rejects
- Set retail from a required gross margin, not a rule of thumb
- Account for payment fees, delivery, returns and marketing separately
- Test the same cost against wholesale terms before you commit
Reading a quote line by line
Ask for the quote in this shape. Any supplier costing properly can produce it.
Fabric
Consumption per unit, fabric price, wastage allowance. The largest line on most knitwear, and the one worth questioning first.
Cut and make
Cutting, sewing, trimming and pressing, driven by operation count. The line that moves when you simplify construction.
Trims
Thread, elastic, cords, zips, interlining and labels. Small individually, and often carrying their own minimums.
Decoration
Priced by method, colour count, stitch count and run length. Setup-heavy methods reward volume.
Packing
Polybags, hangtags, folding, cartons and shipping marks. Cheap to specify, expensive to forget.
Overhead and margin
The factory's fixed costs and profit. Legitimate, and worth understanding rather than squeezing to zero.
The useful question is never just what does it cost. It is which line is driving the cost, and would changing that line change the product in a way the customer notices.
Common questions
Because pattern making, marker making, setup and inspection are largely fixed per order. Spread across 50 units they are a large share of the price; across 500 they are small. The fabric and labour per unit barely change.
Usually fabric, calculated as consumption multiplied by fabric price plus a wastage allowance. That is why pattern shape, body length and fabric width all affect price more than founders expect.
No. Each colour is effectively its own run: its own fabric lot, its own marker and setup, and its own minimum. Adding units inside an existing colour is far cheaper than adding a new colour.
Ex-factory unit price, freight, duty and clearance, inbound handling, and any per-order charges, divided by the units that arrive saleable rather than the units ordered.
Start from the gross margin you need after cost of goods to cover payment fees, delivery, returns, marketing and your time. Divide landed cost by the remaining fraction. Then sanity check the result against your market position.
We can give an indicative range from a reference garment and a description. A firm quote needs fabric, construction, decoration and quantities. See the tech pack guide for what to send.
Want a quote you can actually read?
Send us the style, the fabric direction and your quantities. We will come back with the breakdown, not just a number.