Compute accurate FOB prices, gross margins, and full cost breakdowns for any garment
Garment costing is the process of calculating every expense associated with producing a single piece of clothing — from raw fabric and thread, through cutting and sewing labor, to finishing, quality control, packaging, and logistics. An accurate cost sheet is the foundation of any profitable clothing business, whether you are a fashion designer placing your first factory order, a merchandise buyer negotiating with overseas vendors, or a production manager tracking COGS for a seasonal collection. Our Garment Costing Calculator brings together all the cost components used by professional apparel cost engineers and condenses them into a single, easy-to-use online tool. You do not need a spreadsheet or expensive ERP software. Simply enter your fabric price, consumption, wastage allowance, trim cost, CMT (cut-make-trim) labor, overhead, and any additional charges such as embroidery, packaging, and freight. The calculator instantly outputs your total production cost per piece, your FOB selling price, wholesale price, retail price, and gross margin — all updated in real time as you type. One of the most valuable features is the visual cost breakdown donut chart, which shows exactly how each cost component contributes to your total. Research consistently shows that fabric accounts for 60–70% of a basic garment's production cost, and our chart makes this immediately visible. If your fabric share is unusually high, you know where to negotiate. If your CMT share is creeping up, you can investigate factory efficiency or renegotiate your labor rate. The calculator supports two labor costing modes. The first is the simple direct-entry mode, where you type in the CMT cost per piece as agreed with your factory. The second is the SMV-based mode, where you enter the Standard Minute Value (the number of minutes it takes to produce the garment) and the factory's cost per minute (CPM). This approach gives you much greater transparency into how your labor cost is derived and allows you to compare factories on an apples-to-apples basis. We also support a reject or defect allowance — a gross-up factor that is often overlooked by new brands. If your factory's typical defect rate is 3%, producing 1,000 sellable pieces actually requires making approximately 1,031 pieces. Our reject gross-up formula (adjusted cost = total cost ÷ (1 − reject%)) automatically accounts for this, so your pricing reflects the real cost of reaching your required good-piece quantity. The markup vs. margin toggle addresses one of the most common sources of confusion in the apparel industry. A 20% markup means you add 20% on top of your cost (so a $10 item sells for $12). A 20% margin means your profit is 20% of the selling price (so a $10 item sells for $12.50). These are different calculations that lead to different prices, and confusing them can erode profitability on every order. Our tool makes the distinction crystal clear. Five garment type presets — T-shirt, dress, denim jeans, knitwear, and outerwear — provide realistic starting values for fabric consumption, price per yard, CMT cost, and thread usage. These presets are drawn from industry benchmarks and make it easy to start a new costing sheet without needing to look up typical values from scratch. Finally, the calculator supports eight major currencies used in global apparel trade — USD, EUR, GBP, INR, CNY, BDT, VND, and PKR — along with per-piece and per-dozen display modes, order quantity input for total order value, and CSV export so you can save your cost sheet or share it with colleagues.
Understanding Garment Costing
What Is Garment Costing?
Garment costing is the systematic calculation of all direct and indirect expenses required to produce one unit of a clothing item and bring it to market. It typically covers four major cost layers. First is material cost, which includes the main fabric, lining, interlining, thread, buttons, zippers, elastics, labels, and hang tags. Second is labor cost, often called CMT (cut, make, trim) — the factory's charge for cutting fabric, sewing all seams, attaching trims, and finishing the garment. Third is overhead, which covers the factory's fixed costs (rent, utilities, depreciation, supervisory salaries) allocated on a per-unit basis. Fourth are additional costs such as embroidery or printing, washing or garment dyeing, quality inspection, packaging, and freight to the buyer's warehouse. Summing these four layers gives the total production cost. Adding the manufacturer's or brand's profit margin then yields the FOB (free on board) selling price — the price at which a factory or exporter delivers the goods to the shipping port. Wholesale price adds a further markup for distribution, and retail price adds the final consumer-facing markup.
How Is Garment Cost Calculated?
The core formula for garment costing follows a straightforward cost-stack approach. Fabric cost per piece is calculated by multiplying the fabric consumption in yards by (1 + wastage %) to account for cutting waste, then multiplying by the fabric price per yard. Any freight or insurance charges on the fabric are added, and an optional finance charge (a percentage of fabric cost) covers interest on pre-payment. Thread cost per piece is calculated as (cone price × meters per garment) ÷ meters per cone. CMT (labor) cost is either entered directly as a per-piece amount agreed with the factory, or derived from the formula: CMT = SMV (standard minute value) × CPM (factory cost per minute). Total production cost is the sum of all the above plus overhead, embroidery, washing, packaging, QC, and logistics. When a defect allowance applies, the adjusted cost = total cost ÷ (1 − reject%). Finally, selling price = adjusted cost × (1 + markup%) for markup mode, or adjusted cost ÷ (1 − margin%) for margin mode. Gross margin % = (selling price − cost) ÷ selling price × 100.
Why Does Accurate Costing Matter?
Inaccurate garment costing is one of the leading causes of financial loss in the apparel industry. If you undercost, you win orders at prices that do not cover your actual expenses, and each sale erodes your capital. If you overcost, you lose orders to cheaper competitors or price yourself out of the market. Precise costing also enables better negotiations: when you can show a factory exactly how their quoted CMT rate translates to your final FOB price, you have a much stronger basis for discussion. For fashion brands, costing determines which designs are commercially viable before any samples are cut. A beautiful garment that requires 3 yards of expensive fabric and 45 minutes of skilled labor may simply not be achievable at a competitive retail price point. Costing gates like this — sometimes called 'design for cost' — are built into the product development process at every professional fashion company. Additionally, accurate historical cost data forms the basis for COGS (cost of goods sold) reporting, which affects gross profit, inventory valuation, and tax filings.
Limitaciones y advertencias
This calculator provides estimates based on the inputs you provide, and like any costing tool, its accuracy depends entirely on the quality of those inputs. Fabric prices fluctuate with raw material markets, currency exchange rates, and seasonal demand — a price quoted today may differ from what you pay when your order ships in three months. CMT costs vary significantly by country, factory tier, order size, and product complexity; industry benchmarks are useful starting points, but always verify with your specific factory. Overhead allocation methods differ across factories (some include machine depreciation, others do not), which can make direct comparisons difficult. The defect allowance is a simplification — real quality costs include inspection time, rework labor, and the cost of materials in scrapped pieces. Finally, this calculator does not account for import duties, value-added taxes, agent commissions, or landed-cost charges, all of which can add 10–30% to the cost seen at the factory gate. For complex multi-style orders or detailed financial reporting, always supplement this tool with a proper cost accounting system.
How to Use the Garment Costing Calculator
Choose a Preset or Enter Fabric Details
Select one of the five garment type presets (T-shirt, Dress, Denim, Knitwear, Outerwear) to auto-fill typical values, or enter your own fabric price per yard and consumption in yards per piece. Add your wastage percentage — typically 3–5% for woven fabrics and up to 10% for pattern-matched or striped materials — and any freight or finance charges on the fabric.
Enter Labor and Other Costs
Choose Direct CMT Entry to type in the factory's quoted cut-make-trim cost per piece, or switch to SMV × CPM mode and enter the Standard Minute Value for the style along with the factory's cost per minute. Then fill in trims and accessories, overhead (as a flat amount or percentage of material cost), embroidery, printing, packaging, QC, and logistics as applicable.
Set Your Pricing Parameters
Enter your desired profit percentage and choose between Markup mode (profit is a percentage of cost) or Margin mode (profit is a percentage of selling price). Add a reject allowance if your factory has a known defect rate. Optionally enter wholesale markup and retail margin percentages to see the full pricing cascade from FOB to store shelf. Enter your order quantity to see the total order value.
Revisa resultados y exporta
The donut chart and horizontal bars instantly show how each cost category contributes to your total. Toggle between per-piece and per-dozen views to match your factory's preferred pricing convention. Once you're satisfied, click Export CSV to download a cost sheet you can share with buyers or archive for COGS reporting, or click Print Cost Sheet for a clean print layout.
Preguntas Frecuentes
What is the difference between markup and margin in garment pricing?
Markup is calculated as a percentage of the cost price, while margin is calculated as a percentage of the selling price. For example, if a garment costs $10 to produce and you want a 20% markup, the selling price is $10 × 1.20 = $12, and your profit is $2. If instead you want a 20% margin, the selling price is $10 ÷ (1 − 0.20) = $12.50, and your profit is $2.50. The two modes yield different selling prices for the same percentage figure. Most Western fashion brands use margin-based pricing, while many factories and exporters quote markup. This calculator supports both modes and makes the distinction explicit so you always know which basis your prices are built on.
What is CMT and how is it different from FOB?
CMT stands for Cut, Make, and Trim — it is the factory's charge for the labor and direct manufacturing work involved in producing a garment. It covers cutting fabric pieces, sewing them together, attaching buttons and zippers, and finishing (ironing, tagging, packing). CMT does not include the cost of the fabric or other materials. FOB (Free On Board) is the total price the buyer pays to receive finished goods loaded onto a ship at the origin port. FOB = materials + CMT + overhead + any additional costs + profit. When you hear a factory quote a FOB price, all those cost layers are already bundled in. This calculator lets you build up to the FOB price from its individual components so you can verify that the factory's quoted price is reasonable.
How do I calculate fabric cost per garment?
Fabric cost per garment is calculated by multiplying fabric consumption (in yards) by a wastage adjustment factor, then by the fabric price per yard. The formula is: fabric cost = consumption × (1 + wastage%) × fabric price. For example, a dress requiring 2.5 yards of fabric at $4 per yard with 5% wastage costs: 2.5 × 1.05 × $4.00 = $10.50. If the fabric is shipped from overseas, you should also add freight per yard and any insurance charges. An optional finance rate can be applied to the fabric cost to account for the interest cost of paying for fabric before it is converted into finished goods and sold.
What is SMV and why does it matter for costing?
SMV stands for Standard Minute Value — it is the number of minutes it should take a factory worker operating at 100% efficiency to complete one operation or one full garment. A simple T-shirt might have an SMV of 12–15 minutes; a tailored jacket could be 60 minutes or more. Multiplying SMV by the factory's cost per minute (CPM) gives a precise labor cost per piece. This method is more transparent and auditable than accepting a factory's CMT quote at face value, because it ties the price directly to measurable production time. CPM is typically calculated as total monthly factory overhead ÷ (workers × working minutes per month × efficiency%). Using SMV-based costing helps you compare factories on labor efficiency and identify where time (and cost) can be saved.
What is a reject or defect allowance and how does it affect cost?
A reject or defect allowance accounts for the fact that not every garment produced will meet quality standards. If a factory has a 3% defect rate, producing 1,000 sellable garments actually requires making approximately 1,031 pieces, because 31 will be scrapped or reworked. The reject gross-up formula is: adjusted cost = total cost ÷ (1 − reject%). So if your total production cost is $10 per piece and the defect rate is 3%, the adjusted cost is $10 ÷ 0.97 = $10.31. Failing to include a defect allowance means your costing understates the true cost of fulfilling an order, which erodes margin on every delivery. The size of the allowance depends on factory quality history, garment complexity, and the buyer's acceptance quality level (AQL).
How do wholesale price and retail price relate to FOB price?
FOB price is what the factory charges the brand or importer — it is the starting point for the pricing chain. The brand then adds its own costs (duties, freight to domestic warehouse, quality inspection, agent commissions) and a wholesale markup to arrive at the price charged to retailers. Wholesale markup is typically expressed as a percentage added to the brand's landed cost. Retailers then apply their own margin — often 50–60% in traditional retail, meaning they sell for roughly double the wholesale price. In this calculator, wholesale price = FOB × (1 + wholesale markup%), and retail price = wholesale price ÷ (1 − retail margin%). These figures help fashion brands understand the full pricing cascade and ensure their product is positioned correctly relative to the consumer's expected price point.