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General

Factors influencing costing of woven fabrics

Costing is a very complex procedure, with set patterns and guidelines followed by the industry, and it is
difficult to find out costs for every process as there are some inbuilt costs while costing, elaborate Saroj
Bala and Tripti Gupta.

Woven fabrics are used worldwide for many applications like apparel,
home furnishing, accessories, industrial and medical textiles. It is
estimated that the global production of woven fabrics will grow 35 million
tones by 2010 and most of this growth will be in Asia. It is also
estimated that Asia will emerge as the biggest market for sourcing of
fabrics for the garment and apparel industry. Costing of woven fabrics
for garment manufacturers is one of the most important aspects of
garment production. About 65 - 70% cost of the garment is the cost of
the fabric and hence, it is very crucial to get the right cost of the fabric
from fabric manufacturers and suppliers.

A large variety of fabrics are used in the export/domestic market for different end-uses. Buyers send
specifications and the fabric has to be developed as per the design trend. Garment manufacturers source
fabrics with specific construction and characteristics in different quantities for different end-uses. Garment
manufacturers struggle to get the best possible cost of the fabric. It would be interesting to know the
important points to consider for getting a comprehensive understanding of costing. Costing seems to be a
complex exercise as it depends on a number of variables. Costs are calculated taking into consideration the
complete production process and machinery involved. However, in this article, the authors consider only
the commercial costing keeping in mind the manufacturing cost and wet processing cost.

What are the costs to consider…?

i) Direct cost: Cost of raw material -- 66%. Cost of size and chemicals - 4%. Production cost comprising of
running the machine, maintenance, power fuel, humidification and other utilities -- 8 % and worker wages

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and salaries -- 8% losses incurred due to shrinkage, wastage, grading, and also selling commissions.

ii) Indirect cost : Interest on investment, loan, working capital, depreciation, etc. Above 7%,
overheads and administrative expenses like travelling, telephone, couriers, legal issues, taxes
comprising of 7%.

iii) Profit: 10 - 20% depending on the order size. In some companies, 70% of the fabric cost will
comprise of direct cost, but in corporate selling only 40% cost of the fabric is direct cost and 60% is
overheads.

What are the factors which affect the cost …

Let's take a close look at the direct cost…

Type of raw material

Raw material cost includes cost of fibre or yarn. The cost of the fibre will depend largely on its generic type -
cotton, linen, wool, silk, rayon, nylon, polyester, polyester cotton blend etc, and also its quality. The Yarn cost
will depend on the count of the yarn -- finer the yarn, more expensive it will be. Carded or combed: Combed
yarns are more expensive than carded yarns as yarn realisation is only about 70% incase of combed yarns
because short fibres are removed where as in case of carded, the yarn realisation is about 88%. Combed yarns
have more lustre and strength than carded yarns. All finer counts above 40s are generally combed yarns. Method
of spinning-open-end or ring spun. Open end yarns are cheaper as the cost of manufacturing is less. It is used
for coarser yarn count below 20s.

The cost of man-made spun yarns will depend on the fineness -- finer the yarn, more expensive it is. Number of
fine filaments used in making the yarn will also affect the cost. Bright or dull -- Bright yarns are more expensive
than dull. Textured yarns are more expensive than flat because of the additional process cost.

Amount of raw material or GSM of the fabric

Amount of raw material is reflected by the weight or GSM (grams/sq mt) of the fabric. GSM is directly dependent
on the EPI and PPI or construction of the fabric and is inversely proportional to the count of the yarn.
Relation between GSM and cost is a little complex. For the same variety of the fabric, as the GSM
increases the cost increases (see bar graph for poplin and sheeting).

But when the yarn becomes very fine and there is a variation in picks per inch in the fabric, then the
cost of spinning and weaving plays a more important role than the GSM and even when the GSM is
similar, the cost of voile fabric with finer yarns and more picks per inch is more!

Weight of the fabric is the weight of warp and weft which can be calculated by the formula below:

Weight of warp in grams/sq mt of fabric = EPI x 0.6 / Count of Warp = A

Weight of weft in grams/sq mt of fabric = PPI x 0.6 / Count of Weft

GSM = A+B

Sizing and Chemicals Cost

The sizing cost depends upon the count of the yarns. The count becomes finer the size and chemical
cost increases as a rich solution, better quality of size and chemicals is required for better strength.

One needs to add Rs 35/kg as additional cost which includes steam, power or wages. For two plied
yarn no sizing is required.

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Production cost or cost of weaving process

It includes machine running cost, maintenance, labour cost, power & fuel, etc. The weaving cost is affected by
the beam size -- if the beam is small in length, the cost will be more as beam gaiting and knotting will add to
the cost.

Mill-made or powerloom made:

The quality of mill-made fabrics is better than power loom made fabrics in terms
of yarn quality; Therefore the cost of fabric is higher. At times it can be as high
as 25%.. eg, the cost of 40s Poplin 92 x 88 can vary between Rs 22/mt and Rs
34/mt. It depends on the type of loom whether powerloom, rapier, air-jet, dobby
or jacquard and the weave and construction.

The weaving cost is expressed as paisa /pick/inch/sq mt. The cost of weaving
is different for different weaves. The cost of weaving for rapier loom for plain
weave 40" width fabrics = 8 paisa/pick/inch/sq nmt which means that for a
120 inch width fabric the cost will be 24 paisa/pick/mt.

For twill weave, the cost = 12 paisa/pick/inch/sq mt.

For satin weave, the cost = 12 paisa/pick/inch/sq mt.

In case of P/V suiting, the cost ranges from 14 paisa/pick to 20 paisa/pick. For 1,000 m beam with dobby,
the weaving cost is 17 paisa/pick and for 1,000 m beam with jacquard is 20 paisa/pick.

For dobby, the cost = 12 paisa/pick/inch/sq mt.

For 2400 hook jacquard the cost = 40 paisa/pick/inch/sq mt.

For double beam fabrics like seer sucker, the cost is = 20 paisa/pick/inch/sq mt.

There is no standardisation in dobby and jacquard fabrics. These fabrics are produced in different textile centres
like Bhiwadi, Surat, Banaras, Meerut, Panipat and the quality varies a lot. For yarn dyed stripes and checks
in handloom the efficiency is affected by the number of colours in the weft but mill-made stripes and checks
are made on Sulzer loom in which the production is not affected by the number of colours in the warp or weft.

Wastage and shrinkage

Wastage of 2 - 3% in warping and weaving and shrinkage of 1 - 1.5% from loom to grey folding
stage is included in the weaving cost. About 92% of the fabric produced is sold as fresh. The value
loss is about 7% while running cotton material but is only 3% in using polyester yarn.

Dyeing costs

Cost of dyeing depends upon:

Length: A minimum of 2,000 mt of fabric is accepted, if the quantity of the fabric is more say
15,000 mt or 20,000 mt, then the processing charges will be lowered by Rs 1 - 2/mt.

Width of the fabric: If the width of the fabric is doubled, the cost of the processing is not doubled. So it is
beneficial to go for wider width fabrics rather than fabrics with more length. This is because the overheads and
cost of running the material are dependent on the length and not the width. Eg, the cost of dyeing 40" width poplin
is Rs 10, but the cost of dyeing 120" width fabric is Rs 22.

Shade%: Lighter the shade lower the cost. The amount of dye required is less as well as time required for dyeing

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is less. Eg, for dyeing pastel shades if it takes 24 hours, it takes 36 hours for dyeing black shades and
burgundy colour.

Class of dye and quality: Some dyes are more expensive than the other. Eg, Vat dyes are more expensive
than reactive dyes and better expertise is required for dyeing, so for the same shade the cost of a fabric with
vat dyes is more than a fabric dyed in reactive dyes. The choice of dye depends on the buyer, the fastness
properties and also on the shade selected.

Colour: Within the same dye class some colours are more expensive than the other. For eg, turquoise and reds
are more expensive.

Metamerism: Some colours change their shade in different lights. If the shades are matched in two
or three lights only then the cost is less, but when the matching is required in all the six lights,
natural daylight (D-65), Tube light (TL-83), Horizon (yellow light as produced during sun set),
Incandescent, (Inca-A), Fluorescent (CWF or cool white Fluorescent), Ultraviolet light (UL-30 or ultra
luma) or no metamerism is required, then better quality dyes are required and the cost is more.

Weight of the fabric: Lighter the fabric quicker is the dye pick-up so dyeing time is saved. Capacity
of the machine is expressed in weight of the material for lighter weight fabrics, more length of the
material can be processed at one time, so dyeing cost is reduced.

All the above prices are for a minimum quantity of 1,500 - 2,000 mt and if the quantity is less the
price will go up. This principle applies for all yarn-dyed fabrics also. Pastel shades are dyed in procion cold dyes
and medium and dark shades are dyed in hot reactive dyes.

Finishing cost

Process Cost
Flame retardant finish 15Rs/mt
Antistatic finish 5 Rs/mt
Anti stain 10Rs/mt
Anti wrinkle 5Rs/mt

If softeners are added in the jigger after dyeing, then the cost is Rs 10/kg whereas if it is done on a
separate machine and later stentering is done then the cost is Rs 20/kg. The quality of fabric is better in second
case as the cover is better and there is no shrinkage later.

Shrinkage and wastage

It is important to note that wastage and shrinkage are integral part of costing. Generally a minimum shrinkage of 5
- 7% is acceptable.

Below is a Table showing shrinkage of different fabrics:

Below is a Table showing shrinkage of different fabrics:

Fabric Shrinkage%
Poplin, Sheeting 3%
Cotton Voile, cambric 5%
Polyyester/Viscose blend fiber-dyed 4.5-5%
Polyester viscose piece-dyed 6%
100% grey polyester 20%

Cost of the fabric = Cost of grey fabric + dyeing charges + finishing charges + shrinkage + wastage.

Conclusion

Costing is a very complex procedure. There are set patterns and guidelines followed by the industry. It is difficult

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to find out costs for every process as there are some inbuilt costs while costing. A larger picture has been taken
into account while quoting the cost. Costing depends a lot on quantity and order received. Indirect cost is about 15
- 20%. On top of the cost a profit of 15 - 20% is added. It is not only the cost of the final product that matters,
for exports the cost is generally given as FAS, FOB, CIF and LDP.

FAS (Free along Side) means: It is the cost of finished goods plus it includes the delivery of the goods to port,
dock, etc. The price does not include loading into the ship, etc, or the shipping or any other charges incurred
from that point on.

FOB (Free on Board): It is the cost of finished goods, cost of delivery of the goods to port and loading onto the
ship, plane, etc. The cost does not include the shipping or any other costs incurred from that point on.

CIF (Cost Insurance and Freight): It includes the cost of finished goods plus it includes the delivery of the goods
to the port, loading on the ship, shipping charges, all applicable insurance fees along the way. The price does
not include going through customs or any duties or other costs incurred from that point.

LDP (Landed & Duty Paid): It is the cost of the finished goods, plus it includes the delivery of the goods to
port, loading on the ship, shipping charges and the goods brought through the customs with all applicable duties
and taxes paid.

Lead time plays an important part in the domestic and export market. Generally for production of greige fabric
the lead time is 30 days. Processing time for grey fabric is 15 - 20 days but when the buyer needs
something urgently then the above costing parameters sometimes are not significant; It depends on demand
and supply. If you can deliver you can ask for the price!

Ms Saroj Bala, Associate Professor, Pearl Academy of Fashion, New Delhi Mrs Tripti Gupta,
Assistant Professor, Pearl Academy of Fashion, New Delhi

published January , 2009

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