Garments Costing and CM Calculation: Complete Guide for Knit and Woven Apparel

Garments costing is the backbone of the apparel industry. Without accurate costing, a factory can easily lose profit or fail to compete in the global market. One of the most important parts of costing is CM (Cutting & Making) calculation, which directly depends on factory efficiency and operational cost.

In this article, you will learn:

• What garments costing is
• Full costing breakdown for knit and woven garments
• Real factory-based CM calculation method
• Practical examples used in the industry

 

Garments-Costing

What is Garments Costing?

Garments costing is the process of calculating the total expense required to produce a garment and determining the final FOB (Free On Board) price offered to buyers.

👉 FOB Price includes:

• Raw materials
• Production cost
• Overhead
• Profit

 

Main Components of Garments Costing

1. Fabric Cost

This is the largest cost (around 60–70%).

• For knit: calculated using GSM
• For woven: calculated using marker consumption

 

2. Trims Cost

Includes:

• Sewing thread
• Buttons
• Zippers
• Labels
• Poly bags
• Hang tags

 

3. CM (Cutting & Making) Cost

• Labor cost for producing garments
• Depends on SMV (Standard Minute Value)

 

4. Washing Cost

Applicable for:

• Denim
• Garment-dyed items

 

5. Print & Embroidery Cost

• Screen print
• Chest print
• Embroidery logo

 

6. Overhead Cost

Includes:

• Electricity
• Rent
• Maintenance
• Admin cost

 

7. Profit Margin

Usually:
👉 10% – 20% depending on factory strategy

 

Garments Costing Formula

👉 FOB Price = Fabric + Trims + CM + Wash + Print + Overhead + Profit

 

Knit Garments Costing (T-Shirt Example)

Step 1: Fabric Cost

👉 Suppose:

• Consumption = 0.25 kg
• Fabric price = $6/kg

Fabric Cost = 0.25 × 6 = $1.50

 

Step 2: Trims Cost

Item	Cost
Thread	$0.05
Label	$0.10
Poly	$0.08
Total	$0.23

 

Step 3: CM Cost (Real Method)

We will calculate CM using real factory data (explained below in detail).

 

Step 4: Other Costs

• Print = $0.30
• Overhead = $0.20

 

Step 5: Total FOB

Component	Cost
Fabric	$1.50
Trims	$0.23
CM	$0.35 (adjusted)
Print	$0.30
Overhead	$0.20
Total	$2.58

👉 Add profit → FOB ≈ $3.00

 

Woven Garments Costing (Shirt Example)

Step 1: Fabric Consumption

👉 Example:

• Marker length = 1.8 yards
• Wastage = 5%

Consumption = 1.8 × 1.05 = 1.89 yards

👉 Fabric price = $2.5/yard

Fabric Cost = $4.72

 

Step 2: Trims Cost

• Buttons = $0.20
• Thread = $0.10
• Labels = $0.15

👉 Total = $0.45

 

Step 3: CM Cost

(SMV higher than knit, calculated using factory method)

👉 Assume CM = $1.20

 

Step 4: Additional Cost

• Washing = $0.50
• Overhead = $0.30

 

Step 5: Total FOB

Component	Cost
Fabric	$4.72
Trims	$0.45
CM	$1.20
Wash	$0.50
Overhead	$0.30
Total	$7.17

👉 Add profit → FOB ≈ $8.20

 

Real Factory-Based CM Calculation

This is the most important part—used in real factories, not just theory.

 

Step 1: Calculate Cost per Minute

Formula:

Cost per minute = Total Factory Cost ÷ Total Available Minutes

 

Step 2: Calculate Total Minutes

Formula:

Total Minutes = Workers × Working Days × Hours × 60

 

Example (Real Case)

👉 Factory Data:

• Monthly cost = $40,000
• Workers = 120
• Working days = 26
• Hours/day = 8

Total Minutes:

120 × 26 × 8 × 60 = 1,497,600 minutes

 

Cost per Minute:

40,000 ÷ 1,497,600 = $0.0267

 

Step 3: CM per Garment

Formula:

CM = SMV × Cost per minute

👉 If SMV = 8 minutes:

CM = 8 × 0.0267 = $0.21

 

Step 4: Efficiency Adjustment (Real Industry Practice)

Factories never run at 100% efficiency.

👉 Assume efficiency = 60%

Adjusted CM:

CM = 0.21 ÷ 0.60 = $0.35

 

Final CM Formula (Best Practical Use)

👉 CM = (Factory Cost ÷ Total Minutes) × SMV ÷ Efficiency

 

Difference Between Knit and Woven Costing

Factor	Knit	Woven
Fabric Method	GSM	Marker
SMV	Low	High
Cost	Lower	Higher
Production	Faster	Slower

 

Important Tips for Merchandisers

✔ Always confirm fabric consumption from CAD
✔ Add wastage (3%–7%)
✔ Use real SMV from IE team
✔ Consider line efficiency
✔ Update fabric & trims price regularly

 

Conclusion

Garments costing is not just a calculation—it’s a strategy. A proper understanding of fabric consumption, trims, and especially real factory-based CM calculation can help you:

✅ Quote accurate prices
✅ Increase profit margin
✅ Build strong buyer relationships

Whether you are working with knit or woven garments, mastering costing will make you a stronger merchandiser in the apparel industry.