Price Break Down For Polo Shirt:

Learn Apparel Merchandising, 

Today we will learn how to calculate the price of a Polo Shirt.

Description : 100% cotton pique polo shirt with two button at front placket w/o any pocket.

At first we will calculate the consumption of body fabric from Size spec which we have got from the buyer. (For calculate the fabric consumption see my others post).

Suppose :
i)  The body fabric consumption is 4.05 kg / dozen
    So, total yarn consumption will be = 4.05 + 9%
                                                        = 4.05 + 0.3645
                                                        = 4.41 kg / dozen

ii)  The current yarn price is $4.00/kg

iii) The current Pique knitting cost is $0.20/kg (Knitted by
     circular knit S/J M/c)

iv) Average color dyeing cost is $1.21 / kg

v)  Normally Collar & cuff consumption is 60 gram/body
     (1 pc collar & 2 pcs cuff)
     So,
     for 12 pcs it will be - 0.06 X 12 + 9%  = 0.78 kg / dozen

vi) Collar & cuff Knitting cost is $0.05 (knitted by flat
     knitting m/c)
---------------------------------------------------------------

Now start costing


1st step
Body fabric cost calculation:

Yarn price / kg       = $4.00
Knitting cost /kg     = $0.20
Dyeing cost / kg      = $1.21
_____________________
Finished fabric cost = $5.41

2nd Step
Collar & cuff cost calculation:

Yarn cost/Doz      =  0.78 X $4.00  = $3.12
Knitting cost/Doz  = $0.05 X 12      = $0.60
Dyeing cost          =  0.78 X $1.21  =  $0.94
___________________________________
Collar & Cuff cost / Doz                  = $4.66

3rd Step
Total production cost:

Body fabric cost  ( 4.41 kg X $5.41)    = $23.86 / Doz
Collar & Cuff cost                                =  $4.66 / Doz
CM                                                      =  $6.00 / Doz
Accessories Cost                                 =   $3.00 / Doz
__________________________________________
Total production cost:                       =  $37.52 / doz

Final Step 

Fob pricing of per piece polo shirt:

Total production cost :                     = $37.52 / doz

Commercial cost will be (3%)          =  $0.95 / doz (Except CM)

Profit will (20% of CM)                   =  $1.20 / doz 

_________________________________________

Total FOB price (doz)                     = $39.67 / doz

Fob price per piece will be               = $3.3058 / pc

Final quoted price for buyer    = $3.35 / pc (FOB)