how should i price my garments?

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how should i price my garments?

Postby sewingbug » Sun Nov 08, 2009 9:14 am

how should i go about pricing my garments for a home made business?

im quite lost as a few years ago, i undertook a sewing course where for the major project, we had to sort of imagine we were running a small custom-fitting based business.

anyway, i decided to sew a little sundress made of gabardine for a 6 yr old girl, charging $13/h for labor...to cut a long story short, the final cost of the dress (inc labor x no. of hrs spent cutting, making and stitching the dress) was $400.00. this completely shocked me, as i only expected it it to be around $30.00. my teacher told me that in the industry, the final price would have been divided by the total number of "copies" made of that dress, hence would have more of a realistic price...but im not in tthe industry, ans i obviously cant charge customers that high :shock:

so now im confused as to how to figure out pricing for the garments i make.

what are the factors to take into account when pricing garments.
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Postby Kate XXXXXX » Sun Nov 08, 2009 10:22 am

You need to take a good long look at this: http://www.fashion-incubator.com/

And pay up and buy Kathleesn's book and join in fully... But do a good bit of reading first. The answers to your questions are probably buried in the archives.
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Postby JanS » Sun Nov 08, 2009 7:05 pm

Unfortunately you have to price your items according to what the market will bear. It is still a case of supply and demand even for custom made items. If someone is willing to pay for a custom, tailored to fit, child's dress for more than they could buy a ready made dress in a store then you have a customer.

In order to make a profit you will need either to cut corners on labor costs or supplies.

I never add my labor cost to the final cost of my items. My labor cost is part of the overall profit margin. Labor costs can only be added if you have to pay someone else to do some or all of the work.

What was your total cost of the supplies for the dress? Those are your fixed costs. Don't forget to add overhead costs. You need to at least charge what it cost you in supplies and overhead. Then you can add what you feel in a reasonable mark-up prices to cover you labor and expertise. That is your profit margin.

There are lots of people that simply double or triple the fixed cost to come up with the price but that can sometimes work against you. For example if your dresses all of a sudden become a demand item, then you can increase your prices accordingly.
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Postby sewingbug » Mon Nov 09, 2009 5:43 am

thanks for that...

What happens when you spend alot on the supplies themselves, but because competition is low, then you are forced to price your item low, despite the fact that you have spend a good amount on supplies, etc.

and also, "overhead" meaning supplies such as needle repair, etc? What exactly would be considered as overhead items? Does electricity used count?
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Postby JanS » Mon Nov 09, 2009 7:06 am

Overhead would be a percentage of the following costs:
the sewing machine if under a year old
the cost of electricity
the area you work

Overhead is the cost of just being in business without any customers. Overhead is business insurance, licenses and permits, housing the business, transportation, advertising, office supplies, employees, shipping and anything else needed to run your business. You would need to put together a spreadsheet of those costs and then have it broken down into increments to see how much it would add to each item you make.

If you find that the cost of supplies rules out any profit, you can either opt not to make that item or find supplies at the wholesale level (which is what you should be doing if you are in business).

I do not quite understand your remark about competition being low because that is what you want - virtually no competition. If there is no competition then you can charge what you can get for the item, as long as there is a demand. What you will have to do is lots of local research to see if there really is a demand and no competition.
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Postby Kate XXXXXX » Mon Nov 09, 2009 8:42 am

Are you aware of the CPSIA? You WILL Need to comply if you are making children's garments. http://www.fashion-incubator.com/archiv ... les-index/

And what about the Design Piracy Prohibition Act?

http://www.fashion-incubator.com/archiv ... usinesses/

If it is having this drastic an effect on someone like Kathleen, can you afford to ignore these two?
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Postby JanS » Mon Nov 09, 2009 4:15 pm

Kate is right on the money with the note about the regulation in place to for children's garments. All children's garments must under go lead testing and be labled as passing the test. It has put a lot of people that make children's garments, out of the business. From what I hear from others, the testing is expensive - but that could be a wrong statement.
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Postby Kate XXXXXX » Mon Nov 09, 2009 4:37 pm

As I read it, you HAVE to do the tests or have them done for you EACH AND EVERY TIME you use a new design or change an older one slightly, or even use a different colour of thread! I'm not sure the whole lot have to be tested again, or just the new elements, but I wouldn't be surprised if you have to get the whole list of fabrics and findings retested each time you tweak something minute...

It is ridiculous. In many ways the piracy law is even more ridiculous. But you cannot afford to ignore it.
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Postby sewingbug » Tue Nov 10, 2009 10:16 am

thanks again.
so far, im just going to be making kids clothing and selling them over the net? are such regulations still taken into account?


and also Jan, you mentioned breaking overhead costs into increments and adding them onto my final costs. how exactly would i go about calculating how much to add onto the final price of an item.
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Postby JanS » Tue Nov 10, 2009 3:42 pm

The CPSIA regulations was actually brought about because of internet sales. You have to comply with regulations no matter how you sell your items. I think even eBay has been cracking down on people not complying. That is why I mentioned that it has put many people out of business.

I think the only place left to sell would be at local craft fairs, but even then you could get reported by your competition.

As to figuring out your costs into your items, you will need some accounting knowledge and a good business accounting software program. The IRS will require you to keep all your accounting records and keep a separate bank account for your business. Starting a business is not just a simple make something and sell it on the internet, you need to follow regulations, permits, licenses and accounting.
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Postby Kate XXXXXX » Tue Nov 10, 2009 11:04 pm

sewingbug wrote:thanks again.
so far, im just going to be making kids clothing and selling them over the net? are such regulations still taken into account?


Absolutely! And it doesn't matter where in the world you are selling from, if you sell to folk in the USA, every single part of that garment must be tested.
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Costumiers to the Discerning
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Re: how should i price my garments?

Postby Athol » Mon Jan 10, 2011 5:39 am

A professional "sewingLady" in NZ told me that as a general rule you charge $20 (ish) per pattern piece plus materials for basic garments, ie. a t shirt with back front & sleeve would be $60
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