Costing formula
The factory's manufacturing cost for one available minute of sewing capacity. The basis of CM costing.
CPM = monthly manufacturing cost / (operators × minutes per day × working days)
| Symbol | Meaning | Unit |
|---|---|---|
| C_month | Monthly manufacturing cost | currency |
| N | Operators | persons |
| T | Minutes per day | min |
| D | Working days per month | days |
Use it to cost CM from SMV, and to check whether a buyer's target price covers the factory's real cost.
A factory with 600 operators spends 250,000 per month on wages, salaries, utilities, rent and overheads allocated to sewing. It works 480 minutes a day for 26 days.
CPM = 250,000 / (600 × 480 × 26) = 250,000 / 7,488,000 = 0.0334 per minute
CM (cost of making) covers cutting, sewing and finishing. Learn how to build a cost per minute from factory costs, calculate CM from SMV and efficiency, and avoid the assumptions that make CM quotes lose money.
A garment cost sheet adds fabric, trims, cost of making, processes, testing, commercial costs and profit to reach a price. This guide walks through each element with a worked T-shirt example and the checks that stop losses.