A costing sheet sitting inside your PLM—linked live to your BOM, fabric yields, CMT rates, and duty—means your team sees margin before the first sample is cut, not after it comes back wrong. This tutorial walks you through every configuration step, from prerequisites to a working first-cost and landed-cost view.
Key takeaways
- Linking your costing sheet directly to BOM line items eliminates the manual re-entry that causes version drift between design and production.
- Fabric yield is the single biggest variable in first cost; locking it to your marker efficiency data early prevents late-stage surprises.
- According to the International Trade Centre, accurate costing is the first step to moving up the value chain—most teams still treat it as an afterthought after sampling.
- A landed-cost view that includes duty, freight, and agent commission gives buyers and merchants a number they can actually use for margin planning.
- PLM-native costing keeps one source of truth: when a supplier updates a fabric price, every style that uses that material reflects the change automatically.
What do you need before you start?
Before you open your PLM, gather the following:
- A completed BOM for the style you are costing, with every fabric, trim, label, and packaging component listed, quantities confirmed, and units of measure agreed (metres, yards, gross, pieces).
- Fabric yield data—either from a marker run or from your standard yield table by fabric width and style category. If you are pre-sampling, use a conservative estimate and flag it as provisional.
- CMT rate from your factory, broken down if possible into cut, make, and trim (or a single CM rate plus a trim allowance).
- Supplier unit prices for all BOM components, ideally in the currency your factory invoices in.
- Duty rate for the destination country and the correct HS tariff code for the garment.
- Freight and insurance estimate—your logistics team or freight forwarder can supply a per-unit or per-carton figure.
- Agent or buying commission rate, if applicable.
- PLM admin access sufficient to create or edit costing templates and link them to a style record.
Note: If your PLM uses role-based permissions, confirm with your system administrator that your account can edit costing configurations—not just view them.
Step 1: Open the style record and locate the costing module
Navigate to the style record for the garment you want to cost. In Centric PLM, this sits under the style's product development workspace; in WFX, you will find it in the costing tab within the style card; in BeProduct, it is accessible from the tech pack view.
Open the costing module and create a new costing scenario. Name it clearly—include the season, style number, country of origin, and whether it is a development cost or a confirmed cost. You will likely run multiple scenarios per style (different factories, different fabric options), so naming discipline matters from the start.
Expected result: A blank costing sheet is open and associated with the correct style record. The style number, season, and target market are visible in the header.
Step 2: Pull in your BOM line items
Most PLMs allow you to import BOM components directly into the costing sheet rather than re-entering them. Trigger the BOM sync or import function. Every fabric, lining, interlining, zipper, button, label, hang tag, and packaging component should appear as a separate line.
Check that units of measure are consistent. Fabric is typically costed per metre or per yard; trims per piece or per gross; packaging per unit or per carton. Mismatched units are the most common source of costing errors at this stage.
Warning: If your BOM has placeholder components—materials listed as TBD or with zero quantities—flag them before proceeding. A costing sheet with blank lines will understate your first cost and mislead margin calculations downstream.
Expected result: Every BOM component appears as a line item in the costing sheet, with its unit of measure populated and quantities carried over from the BOM.
Step 3: Enter supplier unit prices and apply wastage
For each BOM line, enter the supplier unit price in the agreed currency. If you have multiple supplier quotes, enter each as a separate scenario column or use your PLM's RFQ comparison view to select the winning quote before it flows into the costing sheet.
Next, apply wastage factors. Industry guidance from CBI recommends an average of 3–6% wastage for fabrics and around 2% for trims and packing—the exact figure depends on your pattern efficiency, fabric width, and cutting method. Enter these as percentage uplifts on the relevant lines. Your PLM should calculate the adjusted cost per unit automatically.
Expected result: Each BOM line shows a unit price, a wastage percentage, and an adjusted cost. The fabric lines reflect your yield estimate multiplied by the adjusted price per metre or yard.
Step 4: Configure fabric yield
Fabric yield is the quantity of fabric consumed per finished garment. It is calculated from your marker efficiency and the fabric width. If your PLM links to a marker-making or pattern module, pull the yield figure directly from there. If not, enter it manually as metres (or yards) per garment.
For styles in early development where no marker exists yet, use a yield estimate from a comparable style in your library and mark the field as provisional. Some teams add a buffer of 5–10% on top of the estimated yield at this stage to protect against marker inefficiency.
Tip: Lock the yield field once a confirmed marker is available and update the costing sheet immediately. The difference between an estimated and a confirmed yield can move your fabric cost by several percentage points—enough to flip a margin decision.
Expected result: The fabric cost per unit on your costing sheet reflects the confirmed or estimated yield multiplied by the adjusted fabric price, with the provisional flag visible if the yield is still an estimate.
Step 5: Enter CMT rates and factory overhead
Enter your CMT (cut, make, trim) rate from the factory. If your factory quotes a single CM rate plus a separate trim allowance, enter them on separate lines so you can track each independently. Some factories also quote a finishing or washing charge—add those as distinct line items rather than folding them into CM.
If your PLM supports factory overhead as a separate field (sometimes expressed as a percentage of CM), enter it here. This is the factory's contribution to its own fixed costs and profit, and it forms part of your FOB cost.
Expected result: The costing sheet now shows a subtotal for materials (fabric + trims + packaging) and a subtotal for manufacturing (CMT + finishing + factory overhead). Together these give you your factory cost.
Step 6: Calculate first cost (FOB)
First cost—often expressed as FOB (free on board)—is the price at which the goods leave the country of origin. In your PLM costing sheet, this is typically the sum of:
- Materials cost (fabric + trims + labels + packaging, with wastage applied)
- CMT and finishing
- Factory overhead and profit margin
- Any testing, inspection, or compliance charges billed at origin
If your PLM has a dedicated FOB field, confirm that all the above components are mapped to it. If you are building the sheet manually, create a subtotal row that sums these lines and label it clearly as FOB or first cost.
Note: The ITC Garment Costing Guide distinguishes between CMT orders—where the buyer supplies fabric and the factory costs only labour and trims—and FOB orders, where the factory takes full financial responsibility for sourcing materials. Make sure your costing sheet reflects which arrangement applies to this style.
Expected result: A clearly labelled FOB or first-cost subtotal is visible on the sheet, and it ties to the sum of all origin-side cost lines.
Step 7: Add duty, freight, and agent commission to reach landed cost
Landed cost is what the goods actually cost you once they reach your warehouse. Add the following below your FOB subtotal:
- Import duty: Apply the duty rate for the destination country to the FOB value. Use the correct HS tariff code for the garment category—duty rates vary significantly by fibre content and construction.
- Freight and insurance: Enter a per-unit freight cost. Your logistics team can supply this as a per-carton figure; divide by the units per carton to get a per-garment number.
- Agent or buying commission: If you use a buying agent, their commission (typically expressed as a percentage of FOB) goes here.
- Other destination charges: Port handling, customs brokerage, and inland freight to your warehouse, if your PLM supports them as separate lines.
Your PLM should sum these to a landed cost per unit. If it supports multiple destination countries, configure a column per market so you can compare landed cost by region.
Expected result: A landed-cost total is visible on the sheet. You can see the gap between FOB and landed cost, and the contribution of duty and freight to that gap.
Step 8: Set a target margin and read the margin output
Enter your target retail price (or wholesale price, depending on your business model) into the costing sheet. Your PLM should calculate the gross margin automatically as:
Gross margin % = (Selling price − Landed cost) ÷ Selling price × 100
If the margin is below your target, you now have a structured sheet that shows exactly which cost lines are driving the gap. You can run what-if scenarios by adjusting fabric yield, switching to an alternative supplier price, or negotiating a lower CMT rate—without leaving the PLM.
Tip: Save each scenario with a descriptive name before you change any inputs. Most PLMs let you compare scenarios side by side; this is far more useful in a costing review meeting than a spreadsheet with hidden columns.
Expected result: The costing sheet shows first cost, landed cost, and gross margin against your target. Any shortfall is visible and attributable to specific cost lines.
Step 9: Lock the costing sheet and link it to the tech pack
Once the costing sheet is approved—by your costing manager, merchandiser, or whoever holds sign-off in your workflow—lock it in the PLM to prevent accidental edits. Most PLMs support a status workflow (Draft → Under Review → Approved) for costing records.
Link the approved costing sheet to the style's tech pack so that the production team, QA team, and any external factory portal can see the agreed cost alongside the construction details. This connection is what makes PLM-native costing more reliable than a standalone spreadsheet: the cost record and the product record are the same object.
Expected result: The costing sheet status is set to Approved, it is linked to the tech pack, and it is visible to all stakeholders with access to the style record.
Troubleshooting common issues
BOM quantities don't match the costing sheet after a BOM update. Most PLMs do not auto-sync BOM changes to a locked costing sheet. When a BOM is revised—new trim added, fabric width changed—unlock the costing sheet, re-import or manually update the affected lines, and re-approve. Build this into your ECO (engineering change order) process.
Fabric yield is pulling from an old marker. Check whether your PLM links yield to a specific marker version or to the style's default. If it links to a default, confirm that the default has been updated after the latest marker run. If the link is version-specific, re-point it to the current marker.
Duty rate is wrong for a new destination market. Duty rates are not static—they change with trade agreements and tariff schedules. Do not hard-code a rate in a template and forget it. Set a reminder to verify duty rates at the start of each season, and store the HS code on the style record so the rate can be looked up quickly.
Currency conversion is creating rounding errors. If your factory invoices in one currency and your margin target is in another, confirm that your PLM applies the exchange rate at the right point in the calculation—typically at FOB, before duty is applied. Rounding at multiple conversion points compounds quickly across a large BOM.
The costing sheet and the tech pack show different BOM versions. This usually means the costing sheet was approved before the BOM was finalised. Establish a rule in your team: costing sign-off happens only after BOM sign-off. Use the PLM's dependency or prerequisite settings to enforce this if the system supports it.
What success looks like
When the setup is working correctly:
- Every style has a costing sheet in the PLM, linked to its BOM and tech pack, before the first sample is ordered.
- Fabric yield, CMT rate, and duty are all sourced from live or approved data—not from memory or an old spreadsheet.
- The costing sheet shows first cost and landed cost in a single view, with margin calculated against a target selling price.
- Scenario comparisons are saved inside the PLM, so costing review meetings work from the same data everyone can see.
- When a supplier price changes, the team updates the relevant BOM component and re-runs the costing sheet—no manual copy-paste between files.
FAQ
What is the difference between first cost and landed cost in garment costing? First cost (FOB) is what you pay the factory before the goods ship—materials, labour, and factory overhead. Landed cost adds import duty, freight, insurance, and agent commission, giving you the true per-unit cost at your warehouse.
How do I handle fabric yield before I have a confirmed marker? Use a yield estimate from a comparable style in your library, apply a 5–10% buffer, and mark the field as provisional in the PLM. Update it as soon as a confirmed marker is available and re-approve the costing sheet.
Should I include wastage on trims as well as fabric? Yes. CBI guidance recommends around 2% wastage for trims and packing. It is a small number per unit but adds up across a large order.
Can I run multiple costing scenarios for the same style in a PLM? Yes—most PLMs, including Centric PLM and WFX, support multiple costing scenarios per style. Name each scenario clearly (factory, season, BOM version) and use the side-by-side comparison view for costing review meetings.
What happens to the costing sheet when the BOM is updated after approval? The costing sheet does not update automatically once it is locked. Unlock it, re-import or update the changed BOM lines, and re-run the approval workflow. Build this step into your ECO process so no approved cost goes stale without a deliberate review.
Further reading
- The Garment Costing Guide — International Trade Centre
- How to calculate the cost price of an apparel item — CBI
- Tech Pack BOM: Bill of Materials Guide — Fashion Index