You have received an order for 200 men's shirts—100 for the mass market and 100 shirts of premium quality. You need to ship the order three months from now. Working back from the shipment date, do the costing for each garment line. Also mention how you will place the order for piece goods, and the cutting method, labeling, and finishing you will use for each garment line.

Mass-Market Shirts

The best option we have to produce shirts for the mass market is to outsource the production to a garment manufacturer. This strategy will help us reduce the production cost. We do the costing for the garment based on the following assumption: The manufacturer will use a mass-production method that is highly mechanized and involves little or no workmanship.

Costing: We do the costing for an apparel line by maintaining a cost sheet in which we include all the expenses for producing a complete garment. The cost sheet lists approximate costs for items including the fabric ($3.00); trimmings ($2.00); and labor cost, which includes, patternmaking, grading, and cutting (approximately $5.00). I estimate the freight cost and other additional costs to be $2.00. Thus, the estimated cost of a mass-produced shirt is $12.

The manufacturer will use a low-cost fabric with a high polyester content. The labels will also be of polyester fabric. The garment might lose some of its color and luster after a few washes.

Manufacturers usually order fabric in bulk to reduce the cost of fabric. They may use either of these two planning methods: cut to order and cut to stock. Large companies that mass produce garments of moderate quality at a moderate price use the cut-to-stock method.

After the manufacturer selects the fabric and decides what pattern to use, a fabric cutter cuts the fabric, using a straight knife machine. It is then sewn together into a complete garment. The garments are then shipped to the retailer.

Premium Shirts

Manufacturing premium shirts involves greater workmanship than manufacturing shirts for the mass market, so the production process is less mechanized.

Costing: Again, we do the costing by preparing a cost sheet. We include the approximate costs for the fabric ($7.00); trimmings ($4.00); and labor cost, which includes patternmaking, grading, and cutting (approximately $10.00). I estimate the freight cost and other additional costs to be $4.00. Thus, the estimated cost of producing a premium shirt is $25. The retail price of bulk-produced premium shirts is $80-$90.

Premium shirts are usually made using rich cotton fabrics. They have high-quality buttons that are dyed to match the shirt’s color. The buttons may be made from organic material. The sewing is uniform. Each shirt is precisely tailored to the size specified on the label.

After the manufacturer selects the fabric and the pattern, the fabric is cut. For premium shirts, most manufacturers use one of these two cutting techniques: laser-beam cutting and water-jet cutting.

Premium shirts involve more workmanship than shirts made for the mass market. The stitching is firm and compact, with 18-20 SPI. The shirts have perfect finishing. Manufacturers usually mercerize the shirts to add luster, and they sanforize them to prevent wrinkling

The labels are of soft satin. The label dimensions are accurate, and label stitch lines are not visible from the outside. The shirts have multiple labels that provide information about the fabric, the thread count, and the treatments used.

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