Production Cost
Recently, I have been pursuing my Fashion Industry Essentials Certification through Parsons School of Design and Teen Vogue. I am currently on my third module: Understanding Fashion Production. It is the most business oriented section of the course. I am a creative person but I have always been attracted to business. In the previous module we had to show a clothing item that we created and I created the jacket shown in the picture above about 3 years ago when I was first starting out as a blogger. Fast forward to the Production module we were assigned to calculate the estimated production costs.
Numbers used to scare me until I got into my Payroll Accounting course and realized the math isn't that bad and to be quite frank, I love knowing where my money is going. Initially, when I saw this assignment I was thinking oh no this will take me all day but business math isn't calculus it took me more like an hour. I actually enjoyed this assignment because I can apply production costs to a lot of creative things I do if I want to sell them someday. What has always troubled me as a creative is selling my self short. Basically, cheating myself and not knowing exactly how to price things. So I am very grateful this module taught me how to price things and to see how much the production will cost and the retail price.
The assignment starts with just the calculation of one item so I went with my jacket. I did have to estimate the costs because this jacket and photo is 3 years old. I do remember buying the jacket plain white from AliExpress for 12 dollars. So this is my calculation of the production cost:
Coat $12
Paint set $20
.50 (half an hour) multipled by 14 (pay per hour)
Total Production cost: $39.00
20% profit $7.80
Total cost + Profit = 46.80
I added 2.13 to 46.80 for the estimated retail price and I got $48.93.
The total cost of how much it would be to make one of these jackets would be 46.80. Then I would sale it for 48.93 or possibly 50.00.
Then I did the second part but in my own way. I was thinking what if I sold 4 at a pop up shop or hypothetically my own boutique. If I only had 4 in stock and wanted to see how much it would cost to make and sell.
I went to AliExpress (could not find my original jacket) and I found a cropped jean jacket with flared sleeves. The new jacket was 19.06. Here is the calculation for four cropped paint jackets.
Jacket $19.06 * 4 = $76.24
Fabric paint set in bulk $24.95
.33 hrs @ 14 = $4.62
Total Production cost = $105.81
20% Profit = $21.16
Total cost plus profit = $126.97
I added 7.32 to $126.97 for the estimated retail price and I got 134.29 or 135.00 rounded.
In short, I really enjoyed this assignment. Although, it initially put fear in me I loved it because I can use this on my real life and I will be!
Until next time guys!
