15 Garment Costing Terms Used in Apparel Industry

15 Garment Costing Terms Used in Apparel Industry:

Garments or apparel or clothing costing is very important in garments merchandising. Garment merchandisers have done this job by negotiating with the buyer. During garments costing, there are a lot of garments costing terms that have come into consideration which are mentioned in this article.

Garments Costing Terms

Garments Costing Terminology Used in Garment Export-Import Business:

Different terms related to garments costing are mentioned in the following:

  1. Yarn cost,
  2. Process cost,
  3. Buyer negotiation,
  4. Quality,
  5. Quantity,
  6. CMT,
  7. Overhead cost,
  8. Shortage in process,
  9. Buyer specification about the definite product,
  10. Process of shipment (Sea or Air),
  11. Currency,
  12. FOB,
  13. CIF,
  14. Commission (%) for the middle man,
  15. Profit (%) for factory or buying house.

All the above points have discussed below:

1. Yarn cost:

Yarn cost is an important matter in garments costing. Accurate yarn cost helps to earn maximum profit from a garment export order.

2. Process cost:

Process cost means the total amount of processing (cutting, sewing, finishing, etc.) cost needed to make a garment. The costing of garments varies depending on the process needed to make garments.

3. Buyer negotiation:

Buyer negotiation or buyer handling is very important in the readymade garments sector. As a garment merchandiser, you should explain your total discussion to the buyer in all possible ways by keeping those matters in your way. The buyer will automatically choose from your proposed options.

4. Quality:

Quality is the ultimate point of a garments product. Garments buyers are now invested a lot of money to satisfy the customers by providing the right quality products.

5. Quantity:

Garment costing varies depending on the number of garments.

6. CMT:

CMT means “Cut make and trims”. In this circumstance, the garments manufacturer quotes the buyer a proposed price which covers the making cost, trimmings, and accessories cot of a garment. Here, all the other required materials sent by the buyer to the manufacturer.

7. Overhead cost:

Overhead cost means the cost of each operator required to make a garment. The overhead cost has a significant impact on garments costing.

8. Shortage in the process:

If garments are made by avoiding unnecessary processes then it will be very effective for garments costing.

9. Buyer specification about the definite product:

Buyer specification about the definite garments means direction about garments making, print, embroidery, wash, etc. which is contained by garments specification sheet.

10. Process of shipment (Sea or Air):

Shipment of products can be done by using sea freight or air freight which is totally depends on the buyers. Shipping condition affects on garments costing.

11. Currency:

Currency is an important matter in the garments manufacturing sector.

12. FOB:

FOB means “free onboard”. In this case, the exporter quotes the garment buyer a price that includes all costs up to and including the delivery of goods aboard an overseas vessel. Here, the exporter quotes the price by adding fabric cost, accessories cost, CM (cost of making), overhead cost, commission, C&F commission, and transportation cost from factory to port.

13. CIF:

CIF means “Cost, insurance, and freight”. In this case, the exporter quotes the buyer with a price that covers FOB cost, insurance cost, and freight cost. As a result, the CIF cost is higher than the C&F cost.

14. Commission (%) for the middle man:

If a garment factory collects the order from a garment buying house or buying agent then he must have to pay them a commission percentage for the order.

15. Profit (%) for factory or buying house:

During garments costing, the garment merchandiser added profit (%) here for the factory or buying a house with all the others cost.

Speech from the writer:

If you read this article attentively then you can easily answer the following questions in the interview:

  1. Mention different terms used in garments costing.
  2. Mention various terms used in garment pricing.
  3. Mention some important terms in garment costing.
  4. Mention all the terms used in apparel costing.
  5. Mention different apparel costing terminology used in the garment export-import business.
  6. Show apparel costing terminology list used in garment export-import business.
  7. Mention different apparel pricing terminology used in the apparel import-export business.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.