A buyer asks for fifty pieces of a new style and the price you quote is the same price you
would quote for five hundred. It should not be, and most units know it. But few know
how much it should differ, so the minimum order ends up being whatever feels
reasonable. It can be worked out.
Costs that are paid once per style
Some costs do not rise with the number of garments. They are paid once when a style starts,
and then spread, evenly or not, over whatever you make:
- The pattern — drafting, grading and plotting, the one-off cost
covered in the pattern cost article.
- The samples — garments made to be approved, not sold.
- The changeover — the time the line loses moving from the last
style to this one: new thread, new settings, operators learning the sequence.
Together they are the setup cost of the style. The garment costing sheet has
no line for it, so it is easy to quote as if it were zero.
A worked example
These figures are made up to show the sum. They are not a benchmark and not a claim about any
unit. Where they borrow from earlier articles, that is said.
- Pattern: ₹3,533, from the pattern cost example.
- Samples: two, each costing the ₹738.30 total cost from the
mark-up and margin article, so
₹1,476.60.
- Changeover: an assumption. Say the line of 12 operators loses half an
hour each moving to the new style, and a minute of sewing costs ₹6.67 (the ₹120
stitching cost over an 18-minute garment, as in the
rejects and rework article). That is
12 × 30 = 360 minutes, ₹2,400.
Setup: ₹3,533 + ₹1,476.60 + ₹2,400 = ₹7,410.
What it does to the run
The garment sells at ₹996.71 with a total cost of ₹738.30, a profit of
₹258.41 and a margin of 25.9%. Now spread the ₹7,410 of setup over different
run sizes, with the price held where it is:
- 25 garments: ₹296.40 each. The profit is gone — a loss of
₹37.99 a garment.
- 50 garments: ₹148.20 each. Profit ₹110.21, margin 11.1%.
- 100 garments: ₹74.10 each. Profit ₹184.31, margin 18.5%.
- 200 garments: ₹37.05 each. Profit ₹221.36, margin 22.2%.
- 500 garments: ₹14.82 each. Profit ₹243.59, margin 24.4%.
- 1,000 garments: ₹7.41 each. Profit ₹251.00, margin 25.2%.
The pattern of it matters more than any one line. Going from 500 to 1,000 garments is worth
less than one point of margin, 24.4% to 25.2%; going from 25 to 50 turns a loss into a
profit.
Three numbers worth knowing
- About 29 garments — the run at which the setup uses up the whole
profit. Below that, the order costs you money at this price.
- About 57 garments — the run at which it uses up half.
- About 372 garments — the run at which setup is no more than 2% of
the price, if that is the level you decide is negligible.
Choose the line before you work out the number
Decide first how much of the profit you will let a short run give away — half, a
quarter, none. Then divide the setup by it. The minimum order is whatever that comes to,
not a figure that feels fair.
What to do with a small order
There are three honest answers, and a unit can use all of them:
- Set the minimum where the setup stops hurting. At these figures a
minimum of 372 keeps it to 2% of the price.
- Quote short runs higher. To keep the same 35% mark-up on a run of 50,
the price has to be ₹1,196.78 instead of ₹996.71 — ₹200.07 more, or
20%. A buyer who wants fifty is paying for the setup either way; it is better if the quote
says so.
- Make the setup smaller. A style that comes back reuses the pattern; a
sample approved the first time costs one garment, not two; a changeover rehearsed on a
planned day loses fewer minutes than one improvised at four in the afternoon.
Measure yours
Nothing above is a reading from your unit. For the next three styles, write down:
- How many samples it took before the buyer approved.
- How long the changeover took, with a stopwatch, from the last good
garment of the old style to the first good one of the new.
- How many hours the pattern took, including the corrections.
What the sums leave out
- Double counting. If the overhead percentage on your costing sheet already
carries some changeover time, do not charge it twice.
- A made-up changeover and minute rate. Both are assumptions in this
example. Use your own.
- Fabric and trim minimums. A mill or a trim supplier may set a minimum
of its own, which can matter more than any of this.
- What a buyer is worth over time. A first small order from a buyer who
reorders is a different decision from a one-off, and no sum on this page can tell you which
you have.
The costing calculator and the
pattern cost calculator do the two halves of this sum: what one
garment costs, and what the pattern adds. The
line efficiency article explains why a
changeover shows up as lost minutes you never see written down.