“How much does it cost to produce clothing” is a question that a lot of people want to know the answer to. Determining production costs helps enterprises decide how much is the optimal quantity and have a reasonable pricing strategy. In addition, information on manufacturing costs also creates chances for businesses to make better decisions about suppliers. Find out more useful information about production costs with Dugarco in the article below.
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1. Factors that affect the price of produced clothing
Making clothes is a complicated process and needs to go through many stages. The process starts from drafting ideas to material selection then to purchasing material, packing, delivery, and many more. Furthermore, there are many elements involved in the production process. Therefore, how much does it cost to mass produce clothing is related to many criteria.
1.1 Depends on the manufacturers and suppliers
No matter what material or style your garment is made of, it needs to go through a manufacturer. The manufacturer is a key factor in determining the cost of production. Each manufacturer has different conditions. For example, Vietnam shirt manufacturers will have their own production conditions. They own distinct lines of equipment. They focus on diverse product lines so they have different fabrics and workers with certain skills. They are located in different locations and often work with various clients. Therefore, you need to carefully consider which manufacturer is most suitable for your product to optimize how much does it cost to produce a clothing line.
1.2 Depends on the style and complicated clothes
How much does it cost to produce clothes is heavily influenced by the style and intricacy of the work. It will be easier to negotiate if the style you desire is a strong feature of the company and they routinely create that type of style. If your style is too different, the manufacturer will have to convert to produce it in the way you want, which could be more expensive.
In addition, how much does it cost companies to produce clothes is heavily influenced by complexity. The more complicated clothing is, the longer it takes to make it. The firm will have to pay more for employees, use machines more frequently, and face higher opportunity costs. Every manufacturer wants their goods to reach the buyer as soon as possible, thus they will prefer to mass-produce simple clothes rather than extremely complicated ones. As a result, a high-complexity garment is frequently required to pay a high fee to be approved for production.
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1.3 Your choice of materials and fabrics
Choosing the fabric for your garment is another stage that has an impact on how much does it cost to produce clothes. The cost is likely to be reduced if you choose a fabric that is simple to manufacture and easily available from the firm. On the other hand, if you select a fabric that is not readily available and must be imported, you may face additional expenditures like delivery costs or import taxes, among other things.
Furthermore, whether the fabric is simple to work with and manipulate on the manufacturer’s machinery line also has an impact on how much does it cost to produce clothing. Many textiles offer numerous advantages, but they are tough to handle, thus the price will be higher. As a result, you should select a manufacturer that has some professional experts that can advise you on the appropriate fabric.
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1.4 Depends on dyeing, printing, embroidery, and accessories
Dyeing, printing, embroidery, and accessories are those things that make art come to your clothing. All of this must be in harmony and together create a good style. There are many different technologies and techniques that manufacturers can apply to create the final product. Each method requires different conditions and has different costs. Not all manufacturers can print or dye on all fabrics. They sometimes need another unit to participate in the machining process. So how much does it cost to produce a clothing line can vary greatly depending on your requirements.
Accessories are also an important part of the production cost. Each product, even the simplest, has certain accessories. From simple things like buttons, buckles, rubber bands to more complex accessories to go with the outfit like necklaces or flowers attached to the shirt,… Whether an accessory is easy to add to the clothes or not, how it is stored and transported are factors that would define the answer for the question of how much does it cost to produce clothing.
1.5 Labels & Packaging
The label is only a small part of your product, but it is very powerful. It helps the clothes look more professional and believable. From there, your brand will have a better place in the customer’s mind. In addition, the clothes can be attached with information tags about size, material, and care instructions. Packaging and carrying bags are also necessary parts to help your products be better preserved. These make your product more complete and aesthetically pleasing. All of these also affect the cost of producing clothing.
1.6 Factor in labor costs
How much does it cost to produce clothing also depends on the cost of labor. If the manufacturer is located in a place where the standard of living is high, the cost of hiring labor is also higher. The more complex the clothes, the more skilled workers are required. This means that labor costs have risen as well. Moreover, the time it takes to produce a product also affects the cost of labor. The longer it takes to make clothes, the greater the labor cost, which has an impact on manufacturing expenses.
1.7 Depends on shipping & logistics
The finished product process is not just about designing, cutting, or even packaging. It also needs to be delivered to the clients that need it. Shipping charges vary depending on whether it is transported locally or abroad, by which form of transport, and how long it takes to reach the distributor’s hand. For example, shipping by the board may take longer, but it is usually cheaper. If you want your goods to be delivered as quickly and safely as possible, you are likely to have to use air transport, which is much more expensive.
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1.8 Depends on other expenses
Production cost depends on many other factors. For example, it is hiring a designer. If you choose a designer who is already experienced in designing the type of clothing you need, it will take you less time. On another hand, if the designer is a newbie and does not have much experience, it may take longer for them to navigate, adjust, and need a lot of help. In addition, fixed costs such as factory rent, electricity to run machinery, wages for workers, insurance, and benefits are what you need to acknowledge to confirm how much does it cost to produce clothing.
2. In short, how much does it cost to produce clothing?
Answering the question “How much does it cost to produce clothing?” clearly is as difficult as answering the question of whether the chicken came first or the egg first. Because the cost depends on all the aforementioned criteria. But each factor is unpredictable, depending on a variety of other circumstances. Therefore, there is no specific number in the answer about production costs, it is all relative. However, you still need to understand the basic factors that affect costs to know how to adjust them more reasonably.
3. The reason why the cost of making clothes in Vietnam is cheap
One of the reasons why Vietnam has become the first choice of investors is that the production costs here are relatively cheap. What distinguishes Vietnam from other countries in terms of lowering production costs?
3.1 Competitive labor costs and low-cost manufacturer
First of all, Vietnam is said to be a low-cost manufacturer with competitive labor costs. We can see that clearly in the figure of the average labor cost per hour in Vietnam is only 2.99 USD (68,000 VND). Meanwhile, in neighboring countries, typically China, the average labor cost is up to US$6.59 (VND 148,000). This is an important factor that makes Vietnam become a more cost-effective option when compared to other nations in the area.
3.2 Having a relatively large and well-educated labor force
Vietnam has a well-invested education system, and vocational schools are widely available throughout the country. The government is continually striving to provide a wide range of high-quality vocational training and education courses to generate a qualified workforce. Therefore, Vietnam not only has a huge workforce but also a high level of education, bringing tremendous productivity, and meeting the great demands of corporations.
3.3 Having put additional strategies and programs in place
It is undeniable that Vietnam still lacks workers in highly technical industries such as IT, machine manufacturing, etc. However, the government has sensible policies and initiatives in place to boost high-quality labor resources. Several incentives, for example, have been granted, including the recent ratification of the vocational education and training strategy 202-2030 and the implementation of Decision 17 on vocational training support.
A slew of free trade agreements (FTAs), including the EU-Vietnam Free Trade Agreement (EVFTA), the UK-Vietnam Free Trade Agreement (UKVFTA), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), boost Vietnam’s competitiveness as a low-cost manufacturing export base. Such trade agreements enable Vietnam to take advantage of lower tariffs, both inside the ASEAN Economic Community (AEC) and with the EU and the US, to lure exporting enterprises to produce in Vietnam and sell to partners outside of ASEAN.
3.4 Government incentives in manufacturing
The government recently issued Decree No. 57/2021/ND-CP (Decree 57), which supports industries related to the supply of raw materials, spare parts, and components to manufacturing industries such as electronics and mechanical engineering, garment and textile, leather, and footwear, hi-tech industries, and the automotive industry. The tax savings resulting from the Decree’s implementation will give financial assistance to firms in their business activities that have been harmed by the Covid 19. It will also boost trust in the government’s attempts to change tax systems and laws, resulting in a more advantageous business climate in Vietnam.
According to Resolution No.115/NQ-CP issued in 2020, the government established an objective of having Vietnamese enterprises be able to manufacture items in supporting sectors with a high degree of competitiveness by 2025, meeting 45 percent of the necessary demands of domestic production and consumption. Furthermore, Vietnam has issued several tax incentives and tax holidays for manufacturing projects in the form of corporate income tax (CIT), for large investment projects with capital of more than VND 6 trillion (US$264 million), as well as incentives for high-tech zones, certain industrial zones, and difficult socioeconomic areas.
The government always has the appropriate policies in place at the right moment. Businesses are continually cared for and encouraged to the greatest extent possible. As a consequence, manufacturers have a better chance of expanding, increasing productivity and quality, and dramatically lowering manufacturing costs.
4. Dugarco Viet Nam – Manufacturer of high quality, affordable clothing
Dugarco is a famous Vietnamese enterprise, inheriting all the advantages of this country. The company owns an abundant, well-trained labor force with competitive labor prices. There are many good development support policies here. Moreover, businesses are also promoted by government policies. All have helped the business to produce quality products at affordable cost.
Although production costs are not high, product quality is always a priority that Dugarco prioritizes. Dugarco’s primary product ingredients are organic cotton and recycled polyester. They not only help the environment, but they also make clients feel more engaged when wearing them. The process of creating a finished product is extremely complicated that goes through 15 steps:
- Drafting idea: Dugarco’s design staff will begin drafting jacket patterns as soon as clients finish orders. The products draft can then be adjusted till all the partners accept.
- Pattern making: Making patterns is an important part in manufacturing process due to that a firm has to create hundreds of product units of the same size and measurement. After that, pattern grading for each size would be granted during the pattern-making stage.
- Material selection: Based on the quality and color requirements specified by the customer, the fabric will be chosen by the manufacturer or directly by clients.
- Making samples: After that, depending on the previously defined pattern, samples will be made. Normally, Dugarco would initially manufacture 2-3 samples to determine whether the parameters of product are acceptable and adequate.
- Fitting: This stage of testing supports Dugarco in defining and precisely assessing the fit of the design for various product sizes.
- Purchasing material: Once the fitting step has been done without mistakes, Dugarco will contact fabric suppliers to discuss the quantity of fabric to be purchased about the number of units of products to be made.
- Material for inspection: A third party will be in charge of determining if the cloth used in manufacturing fits the standard. This is completed to guarantee that the final products are of the greatest quality.
- Pre-production meeting: Dugarco will create an internal meeting to ensure that every team understands the procedure and particular needs for producing products that satisfy client specifications.
- Cutting: This testing stage assists Dugarco in identifying and precisely assessing the fit of the design corresponding to various clothes sizes. Fabric cutting will be done on a level surface as soon as there is adequate fabric supply. A cutter will be used to cut many layers of cloth at the same time. However, the cutting lines will be pre-marked to ensure precision and save fabric waste before the cutting process.
- Bulk production: Dozens of tailors will begin to work on the manufacturing line. During the process, several sewing machines will be running at the same time to ensure production speed and consistency.
- Quality control: As with fabric quality checks, a third party will be involved to inspect all the products for any defects before they are delivered to the clients. If any problem is found, damaged items will be repaired or replaced.
- Needle inspection: Detecting needles in products is a critical step. This not only ensures the quality of the completed garment but also ensures client safety by reducing the possibility of needle injuries.
- Packing: After that, the employees apply to hang tags and price tags to the clothes. Then, the goods will be carefully packed according to the customer’s specifications or in poly bags as is customary.
- Humidity: Dugarco will keep the clothes at the proper humidity level to minimize damage before distributing them to consumers.
- Delivery: This is the final step to giving the products to the client. Dugarco always uses the optimized form of transport to deliver products on time.
At Dugarco, you will never have to worry about boredom or staleness. The designs here are very diverse and can be designed based on the existing templates of the business or according to the requirements of clients. Each project contract will have a separate policy suitable for both parties. In addition, the company’s outstanding advantages also come from factors such as Excellent Product Quality, On-Time Delivery, Advanced Manufacturing Technology, Professional in Material Sourcing, and High Value of Production in Vietnam.
Through this article, Dugarco has helped you answer the question “How much does it cost to produce clothing?”. Hope that you have gained more useful information for yourself and can be more confident to make the right decisions. And if you are located in Vietnam, you had better take full advantage of the benefits that this Southeast Asian country has. In the case you want to learn more about the garment industry or have any suggestions for us, please contact us using the information below.
- Address: No.59, Duc Giang Street, Duc Giang Ward, Long Bien Districts, Hanoi City, Vietnam
- Tel: 024 3655 7930
- Email: firstname.lastname@example.org
- Website: https://dugarco.com/en/
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Dugarco under the talented leadership and guidance of Mr. Hoang Ve Dung has gradually become a large Vietnam clothing manufacturer, supplying clothes for many famous brands from many different countries such as the UK, USA, and Australia.