How much does production cost?!
Sarah at Shanghai Interfiliere Trade Show, chatting with a supplier.
How much does production cost?!
This is a question I am asked time and time again by clients. As I’m sure you realise by now, production costs can be difficult to pin down because there are many factors and moving parts involved in the process.
I’ve gone into these in more detail elsewhere, but to summarise: depending on the design and choice of manufacturer, the cost per unit could be anywhere from $10–$40. This means that for a five-piece collection, production could start from around $7,500 (based on a small MOQ of 150 units per style) and increase from there. Detailed designs and comprehensive tech packs are essential in order to obtain accurate costings.
You will need to determine what cost price you can afford by working backwards from the margin you want to achieve and your expected retail price.
The majority of start-ups I work with would say the entire process has set them back at least £15k (GBP). This figure typically includes marketing, admin, financing, web design, and other associated costs. Many brands use crowdfunding to reach this stage.
Below are some of the key factors that affect production costs, listed in no particular order.
Scale
As with all economies of scale, the higher the MOQ, the cheaper the unit cost. However, this can result in sitting on excess stock, which can severely impact a start-up’s cash flow.
As a new business, it’s often better to start small, gather data quickly on what works and what doesn’t, and replenish efficiently. This approach relies heavily on building a strong relationship with your manufacturer.
Factories willing to work with start-ups usually have MOQs of 300–500 units per style, with surcharges applied for smaller quantities. MOCs (minimum order per colour) can also come into play.
That said, some factories do offer lower MOQs or can work on a made-to-order basis—it’s simply a matter of finding the right partners.
The type of manufacturer
There are two main types of manufacturers: CMT and fully factored.
CMT (Cut, Make, Trim) manufacturers work exactly as the name suggests. They cut the fabric, make the garment, and apply trims. These factories can often produce smaller quantities because they don’t need to meet fabric MOQs, as the client supplies all materials.
Fully factored manufacturers, on the other hand, handle everything—from fabric sourcing and printing to pattern making, cutting, sewing, and delivery logistics. These additional services increase the unit cost but can significantly reduce workload and risk elsewhere.
There are also agents whose role is to match brands with suitable factories. They can help translate requirements, review tech packs, chase late samples, and negotiate pricing. Their fees are typically built into the unit cost.
Cost of raw materials
Yes, sustainable fabrics are still generally more expensive, but prices can vary widely.
For example, fabrics such as TENCEL™ Modal, made from tree pulp, are branded materials produced by specific, well-known mills, which makes them more expensive. More generic fabrics are cheaper because they can be easily replicated, although they may be perceived as lower quality.
It’s essential to conduct background checks on fabrics to understand their origin and verify sustainability claims. There are numerous certifications available to support this. Recycled fabrics are often the most affordable sustainable option and are widely available.
Fabric finishes also affect pricing. For instance, the brushed, soft feel of some leggings is usually achieved through chemical washing—an additional process that increases cost. More eco-friendly alternatives, such as enzyme washes, are becoming increasingly available and use less water.
Location
Manufacturing in the Far East often results in lower unit costs compared to producing domestically or in more developed countries. However, additional expenses should be factored in, including flights to visit factories, international courier charges for samples, and potential agent fees.
These costs can be worthwhile to avoid expensive mistakes caused by miscommunication, such as entire production runs being made incorrectly.
Additions: labelling and packaging
The type and quality of labelling and packaging you choose will also add to unit costs. Luxury finishes or fully biodegradable packaging, for example, come at a premium.
Quality checking
Will you need to travel to inspect your stock? Will someone be dedicated to quality control? Quality checking is critical, particularly for a first production run, and should always be included in your budget.
Additional resources
Further reading:
https://makeitbritish.co.uk/how-to-articles/11-factors-affecting-manufacturing-costs
https://www.commonobjective.co/ – a leading platform for circular fashion economy resources
I hope this has been helpful.
Please reach out if you have any further questions or would like to book a call at sarah@sarahdenisestudio.com