How to Calculate Apparel Costing for T-Shirt?

Knit Garments Costing and Consumption in Apparel Sector:
Fabric consumption and costing is one of the most important tasks for the apparel merchandisers. To get higher profit percentage from an apparel export order, merchandiser should have calculated the total costing and consumption by applying accurate fabric consumption calculation formula.

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T-Shirt Costing and Consumption Method in Apparel Industry:
Calculate the price of a round neck T-shirt in from the given measurement chart and apparel specifications:
Apparel Specifications
Style of T-Shirt
Round neck T-shirt
Fabric
Body - 100% cotton single jersey
Collar – Self fabric
G.S.M
180
Color
Red
Embroidery
Embroidery logo at chest
Size Ratio
S:M:L:XL = (1:1.5:2:0.5)
Order Quantity
10000 pcs

Apparel costing for T-Shirt in apparel industry
Fig: Apparel costing for T-Shirt in apparel industry
Solution:

Fabric Consumption Calculation or Apparel Weight Calculation Formula:
We have to follow the below formula during fabric consumption for the apparel. You may follow How to calculate fabric consumption for T-shirt.

Apparel weight calculation,

      [{T.L + S.L + (2× H.A) + (2 × S.A)} × (1/2 Chest + S.A)] × G.S.M × 2
………………………………………………..…………..……………………         … (1)
                                                      10000

And,

Round neck collar weight calculation,


      {(Neck round + S.A) × (Collar width + S.A) × G.S.M × 2}
………………………………………..………………...........……                …….. (2)
                                             10000

Where,
T.L is stands for Total length,
S.A stands for Seam allowance,
H.A stands for Hem allowance,
S.L stands for Sleeve length.

Apparel weight calculation for middle size i.e. L Size:

Let,
Seam allowance =1cm,
Hem allowance = 2cm,

So,
From equation-01, we get,

    [{60+23+ (2×2) + (2×1)} × (50+1)] ×180×2
……………………………………………………..
                             10000

= 166.60 gms
= 0.167kg

Again, 

From equation-02, we get,

     {(52+1) × (3+1) ×180×2}
………………………………..
                  10000

= 7.8gms
= 0.08kg

So,

L size apparel weight stands at,
= (0.167+0.08) kg
= 0.175kg

Fabric Cost Calculation Per Kg:

SL No.
Particulars
Amount
01
Yarn price per kg
Rs. 240.00
02
Knitting rate per kg
Rs. 8.00
03
Dyeing rate per kg
Rs. 70.00
04
Printing rate per kg
Rs. 0.00
05
Compacting rate per kg
Rs. 6.00
06
Heat setting rate per kg (Synthetic fabric)
Rs. 0.00
07
Total
Rs. 324.00
08
Process loss (8-10%) (+)
Rs. 32.40 (+)
09
Fabric cost per kg
Rs. 356.00

Fabric Cost Calculation per Pc Apparel:

Fabric cost per apparel,
= (Apparel weight × Fabric cost per kg)
= (0.175 × Rs. 356.40)
= Rs. 62.37

Apparel Costing Format for T-Shirt:
The cost of the apparel is calculated as follows:
SL No.
Particulars
Amount
01
Fabric cost per apparel
Rs. 62.37
02
CMT cost
Rs. 10.00
03
Special operations
Rs. 4.00
Rs. 4.00
 04
Accessories and trimmings 
Main label
Rs. 0.60
Rs. 4.55
Wash care label
Rs. 0.30
Pouch or Poly bag
Rs. 1.00
Hang tag
Rs. 0.50
Insert card
Rs. 0.80
Barcode sticker
Rs. 0.60
Hologram sticker
Rs.0.75
05
FOB + Packing
Rs. 6.00
06
Sub total
Rs. 86.92
07
Overhead (10%) (+)
Rs. 8.70
08
Sub total
Rs. 95.62
09
Rejection (3%) (+)
Rs. 2.87
10
Sub total
Rs. 98.49
11
Profit (15%) (+)
Rs. 14.78
12
Sub total
Rs. 113.27
13
Agent’s commission
Rs. 5.67
14
Insurance
Rs. 1.13
15
Apparel price (FOB) in Rs.
Price in Rs. 120.07
16
Apparel price (FOB) in US ($)
Price in US ($) = $2.72
17
Apparel price (FOB) in Euro.
Price in Euro = E 1.91