Margins
Costing & Margin Strategy
If the cost sheet is wrong, nothing downstream can fix it. We rebuild your garment cost from fabric and labor up, so you know your real floor before you set a price.
The number most brands get wrong
Factory price is not product cost. Landed cost includes fabric and trims, cutting and sewing, wash and finishing, labels and packaging, freight, duty, inspection, and the samples and rejects you already paid for.
Brands that price off the factory quote alone often discover their “60% margin” is closer to 35% once the goods are in the warehouse.
What a real cost sheet looks like
- Fabric: price per yard or kilo, consumption, yield and waste allowance
- Trims: zippers, buttons, elastic, thread, interlining, labels, hangtags
- Labor: cut, sew, finish, wash, press, pack — broken out, not bundled
- Overhead and factory margin, stated rather than hidden
- Freight, duty/tariff, customs brokerage and insurance
- Inspection, defect allowance and sample amortization
Engineering the price down
Once the cost is visible, it becomes editable. Usually in that order:
- Fabric: a different weight, width, mill or stock program
- Construction: a seam finish or operation that adds cost without adding value
- Trims: branded hardware versus stock equivalents
- Quantity: where the price breaks actually fall
- Factory: the same garment, a better-matched plant
- Country: only when volume justifies the move
Targets
Margin Math That Holds Up

Direct-to-Consumer
- Target 65-75% gross margin
- Landed cost x 4 is a common anchor
- Returns, shipping & CAC come after
- Discounting erodes it fast
- Price for the promo calendar, not the hero price

Wholesale & Retail
- Keystone or better at wholesale
- Retailer margin expectations set your ceiling
- Terms and chargebacks are real costs
- Needs lower landed cost than DTC-only
- Volume should buy price breaks

Both Channels
- One cost, two price points
- Protect wholesale accounts from your own promos
- MAP policy and discipline
- Watch the blended margin, not the best one
- Plan capacity for both
Questions
Costing FAQ
My factory gave me one number for everything. Is that normal?
How much should I budget for development?
Can I hit my price point at low quantity?
Do duties and freight really matter?

How to Cost a Garment Properly
Building a real cost sheet from fabric and labor up — including the costs most brands forget.
Read guide
Full Package vs CMT: Who Buys the Fabric?
FPP and CMT are the two ways a factory quotes. The difference decides who carries the risk when fabric is late or short.
Read guide
Minimum Colour Quantity and Dye Lots
Every colourway is its own fabric commitment, and the dye house sets a floor you cannot negotiate around.
Read guide
How Much Does It Cost to Start a Clothing Line?
Where the money actually goes in development and a first production run, and how to budget for it.
Read guide