# How to Calculate Apparel Packing Cost in Clothing Industry?

Estimation of Apparel Packing Cost:

Packing or packaging is the part of apparel finishing department. Packing process is done according to the buyer’s requirement. In the past, I have shared two important articles about packing or packaging, where one is types of packing & apparel packaging method and the other one is apparel packing materials & packing cost calculation formula. Now, this article presents the actual packaging cost calculation process in clothing manufacturing industry.

 Fig: Apparel packing or packaging department
Apparel Packing Cost Calculation Method in RMG Sector:
Calculate the packing cost per apparel from the given chart.

 SL No. Parameters Quantity and Cost 01 Order quantity 10000pcs 02 Packing person 10 03 Wages per packing person Rs. 150 per shift 04 Production per shift 2000 pcs apparel 05 1 day 2 shifts (1shift= 8hrs) 06 1 carton box 50 pouch 07 1 pouch 4pcs apparel 08 1 pouch 1 insert card 09 1 pouch 1 tag 10 1 pouch 1 small barcode sticker 11 1 pouch 1 size sticker 12 1 pouch 1 bullet tag 13 1 carton box 1 big barcode sticker 14 1 apparel 1 hologram sticker 15 20 carton box 1 gum tape 16 1 carton box 4 meters plastic strap 17 1 carton box Rs. 40 18 1 pouch Rs. 5 19 1 insert card Rs. 1.50 20 1 tag Rs. 0.80 21 1 small barcode sticker Rs. 0.50 22 1 size sticker Rs. 0.10 23 1 tag bullet Rs. 50 per 1000 bullets 24 1 big barcode sticker Rs. 1.00 25 1 hologram sticker Rs. 1.00 26 1 gum tape Rs. 35.00 27 Plastic strap Rs. 3 per meter 28 Strap machine rent Rs. 500 29 Power Rs. 5000 per month 30 Salary Rs. 50000 per month 31 Rent Rs. 10000 per month 32 Other expense Rs. 15000 per month 33 Profit 15%

Solution:
The below formula has to apply in apparel packing cost calculation:

Packing cost per apparel,

Direct labor + Direct material + Direct expense + Overhead
= ………………………………………….………………….………          ……… (1)
Total apparel packing production

Total Production Calculation:

Total production = 10000pcs apparel

Total Production Time Calculation:

Total production time,
= (Total production / production per shift)
= (10000/2000)
= 5 shifts

Direct Material Cost Calculation:

Carton box = (10000pcs/200pcs) = (50× Rs. 40) = Rs. 2000
Pouches = (10000pcs/4pcs) = (2500× Rs. 5) = Rs. 12500
Insert card = (2500 pouch ×1) = (2500× Rs. 1.50) = Rs. 3750
Tag = (2500 pouch ×1) = (2500× Rs. 0.80) = Rs. 2000
Small barcode = (2500 pouch ×1) = (2500× Rs. 0.50) = Rs. 1250
Size sticker = (2500 pouch ×1) = (2500× Rs. 0.10) = Rs. 250
Tag bullet = (2500 pouch ×1) = {2500× (Rs. 50/1000} = Rs. 125
Big barcode = (50 cartons ×1) = (50× Rs. 1) = Rs. 50
Hologram = (10000pcs ×1) = (10000× Rs. 1.00) = Rs. 10000
Gum tape = (50 carton/20) = (2.5 × Rs. 35) = Rs. 75
Plastic strap = (50 carton × 4 meters) = (200× Rs. 3) = Rs. 600

So,
Total direct material cost stands at,
= Rs. (2000+12500+3750+2000+1250+250+125+50+10000+75+600)
= Rs. 32600

Direct Labor Cost Calculation:

Labor wages,
= (Number of labors × No. of shifts × wage per shift)
= (10×5× Rs. 150)
= Rs. 7500

Direct Expense Cost Calculation:

Strapping machine rent = Rs. 500

In power cost calculation,
= (Cost × 5 shifts) / (30days × 2 shifts in a day) = {(5000 × 5)/60} = Rs. 417

In salary cost calculation,
= (Cost × 5 shifts) / (30days × 2 shifts in a day) = {(50000 × 5)/60} = Rs. 4167

In rent cost calculation,
= (Cost × 5 shifts) / (30days × 2 shifts in a day) = {(10000 × 5)/60} = Rs. 834

In other expenses cost calculation,
= (Cost × 5 shifts) / (30days × 2 shifts in a day) = {(17000 × 5)/60} = Rs. 1251

So,
= Rs. 417 + Rs. 4167 + Rs. 834 + Rs. 1251
= Rs. 6669

From the equation-01, we get,

Apparel packing cost per pc,

(Rs. 32600 + Rs. 7500 + Rs. 500 + Rs. 6669)
= ………………………………………………………..
10000

= Rs. 4.70