Fabric Cutting Process:
The cutting is the process of reproduction of shape of pattern pieces in the fabric during the production of garments. It is totally different from general cutting in which exact dimension is not taken into account. The term fabric cutting is only applicable for garments manufacturing technology. The main purpose of cutting department involves cutting of garment panels precisely, consistent with the pattern shape and size as well as economically and in a necessary volume to keep the sewing department supplied with work.
Operations performed in the cutting department in the following way:
Relaxing of the fabric
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Marker planning
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Spreading
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Marker making
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Cutting
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Sticking sticker in the pieces
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Bundling process
Costing of Cutting Department in Garment Industry:
Costing of the cutting department is critical in garment industry, as it directly impacts the overall production cost. In calculation of the cutting department costing, one has to consider the various raw materials involved in the each stage of the manufacturing process and labors involved in the process.
The following costs are involved in the costing of the cutting department:
a) Labor cost:
In general, there are three different types of labor works in the cutting department namely, Pattern master, Cutting master, and Helpers. The cutting masters are highly paid and highly skilled laborers, who perform all the important and technical activities like, verifying spreading lengths, number of plies, arrangement of pattern and cutting process. The role of the pattern master is to develop pattern by considering the customer requirements and correct the defects if anything is noted in the subsequent activities. Pattern master is also one of the highly paid persons in the department. Other than this, there are several semi-skilled or lower skilled operators used in the cutting department in the name of helpers. They perform all other non-technical and physical activities such as loading and unloading the fabric, fabric relaxation, spreading of fabric, bundling and stickering of the cut components.
b) Raw material cost:
The main and important raw material used in the apparel industry is fabric, throughout the industry irrespective of the departments and manufacturing activities involved. The raw material occupies nearly 50-60% of the total cost of the product. However, in the manufacturing industry, only the conversion cost or expenditures incurred for performing the process are estimated. In this aspect, there are few other raw materials used in the cutting process and those will be considered for the costing process. For example, in cutting department, the cost associated with the purchase of bundle stickers, tags and pattern boards are the raw materials that are usually consumed for every order.
The following are the common raw materials used in the cutting department:
- Pattern sheets and boards
- Size stickers / ply numbering stickers
- Bundle card/Stickers
- Bundle tag
- Machine rental expenses (if any)
- Other materials (Polyethylene sheet in case of computer cutting machine)
c) Other indirect expenses:
The indirect expenses associated with the cutting department are the expenses that are not directly associated with garment production. One of the main expenses is, the expenses related to cutting machines namely, knife cost, machine maintenance cost (for all machines), costs associated with power, cleaning and other general overhead expenses. Similarly, all these factors are also considered in the pattern making and bundling department and are also included in the expenses of the cutting department based on the size of that department. Other than this, administrative activities like stationeries and other related expenses come under the indirect expenses which include manager’s salary, cutting department non-technical staff salaries, etc.
d) Other parameters influencing the cost of the cutting process:
Various other technical parameters are listed here, which have a direct influence on the costing process of the cutting department.
They are given below:
- The number of plies used per spread: The number of plies represents the number of individual layers of fabric in a single spread on the table. This determines the time required to complete the order. More number of plies per spread will reduce the operating time and the cost of the process.
- Type of cutting methods: It is one of the very important factors to be considered. In general, manual cutting or machine cutting is performed in the apparel industry. The productivity of the machine cutting will be higher than the manual cutting. In machine cutting also, the type of machine plays a vital role in the cost of the product produced. For example, straight knife, band knife, and computer-controlled cutting machine are the commonly used machines. The computer-controlled machine can produce a very high output than the other two, but the capital cost invested in the machine is very high. The computer-controlled cutting machine completes the process in a short time than the manual and other machines. Similarly, other machines also have their advantages like handy, lower cost of investment, operator friendliness, etc.
- Fabric type: The thickness, fibers used and structure decide the number of layers, spreading methods and direction. Based on the type of cutting machine used, there may be some difficulties in cutting the fabric based on its thickness and fiber type. For example, a thicker fabric like denim can be spread with less number of plies than a lower thickness knitted single jersey fabric. Hence, irrespective of the company’s production capacity, the fabric characteristics also influence the production capacity of the department.
- Marker planning: Marker planning plays a vital role in fabric utilization in garment manufacturing. Based on the maximum fabric utilization, the marker planning may suggest few changes in the spreading length, width and number of plies which have a direct influence on the cost of the cutting process.
- Ply direction: The fabric type decides the type of ply direction. It has a direct influence on the number of plies and spreads. For example, if the fabric is printed, the ply cannot be spread in both directions. The same applies to pile fabric, fleece fabric, etc.
- Style complication of the garment and number of components: Based on the style complications, the components of the garment may be more in number, or smaller in size and with few other technical specifications. Based on this, the work related to the marking, cutting and sizing parts will be more complicated. As the complication increases, the time increases and the production reduces. This directly reflects in the cutting department operational cost.
The cost calculations in the cutting department are performed to analyze the expenses incurred in the cutting department.
The steps involved in costing calculation of cutting department in garment industry are detailed as follows:
Interpretation of order sheet and understanding the design requirements
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Understanding the quality requirements
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Analyzing the target date and quantity requirements
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Evaluation of available production capacity
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Setting daily / weekly target to achieve delivery date
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Establishing hourly target
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Estimation of number of days or shifts required to complete an order
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Calculation of labor cost (both direct and indirect)
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Calculation of raw material cost (both direct and indirect)
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Calculation of other overhead expenses (maintenance, administrative, etc.)
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Arrival of total expenses by adding all potential costs
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Identifying the total cost for the order
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Calculating the cutting cost / garment produced
The following example will clearly explain the method of calculating the costing for cutting department.
Example:
A garment manufacturing company received an order with an order quantity of 38,000 garments. The factory works with 2 cutting masters, 2 cutting helpers and 2 bundling operators. The wages the company provides are Tk.820/shift for masters and Tk.500/shift for helpers. For cutting process, the company used one band knife machine and 2 straight knife machines throughout the order processing time. During the cutting process, the company replaces the straight knife once in a shift and the band knife once in two shifts. In this regard, the company spends Tk. 200/straight knife and Tk. 350/band knife. By using these machines, the average day production per shift is 3,000 garments and the company works 1 shift per day. After the cutting process, they have to make 100 cut parts together onto a bundle and every bundle is tagged with 1 tag which details the description of the part. After bundling all the pieces, the bundles are pasted with a size sticker. Each garment consists of 12 parts.
Calculate the cutting cost for the order with 15 % profit, if the price of the tag is Tk. 0.50 and the sticker is Tk.12/150 sticker and the company spends Tk.1,50,000/ month of 30 day, as total overhead expenses. Calculate the cost of cutting per garment and total cost.
Solution:
Step 1: Number of shifts required to complete the order.
The order quantity = 38,000 garments
Daily production = 3,000 garments
No. of shits required to complete the order
…….Order quantity
= ——————————
…..Daily production
…38,000
= —————–
…..3000
= 12.67 shifts
Here, the 12.67 shifts represent 12 shifts and a half shift more. Hence, it can be kept as such for the calculation. Further, the company works 1 shift per day, Hence, the number of days required to complete the order is = 12.67 days.
Step 2: Calculation of labor cost
In this department, 2 cutting masters and 4 helpers are involved in the work with the wage of Tk.820 and Tk. 500 per shift.
Hence, the total labor cost is
= (Number of labors × Total working shifts × Wages per shift)
= (2 × 820 × 12.67) + (4 × 500 × 12.67)
= Tk. 20,778.8 + Tk. 25,340
Total Labor cost = Tk. 46,118.8 = 384.32 USD [1 USD = 120 BDT)
Step 3: Calculation of raw material cost
The garment consists of 12 components and the order quantity is 38,000 garments.
Bundles
The cut components are made as bundle of 100 pcs.
Each garment has 12 parts.
Hence, For 38,000 garments
= 12 × 38,000 = 4,56,000 parts.
……………………………………….4,56,000
So the number of bundles = ————– = 4560 bundles
………………………………………….100
Stickers
Totally 4,56,000 components were cut. Hence 4,56,000 stickers are used.
The cost of the sticker = Tk.12/150 sticker
Hence, for 4,56,000 components = 4,56,000 x (12/150)
= Tk. 36,480
Sticker cost = Tk.36,480
= 304 USD [1 USD = 120 BDT)
Tag
The price of tag = Tk.0.50
Total no. of bundles = 4,560 bundles
1 bundle =1tag. Therefore, for 4,560 bundle = 4560 × Tk.0.50
= Tk. 2,280 = 30 USD
Total material cost = Tk.36,480 + Tk. 2,280
= Tk. 38,760
= 323 USD [1 USD = 120 BDT)
Step 4: Calculation of other expenses
Knife cost
The company works 12.67 days to complete the order. For straight knife, one knife per shift is replaced and the cost is Tk. 200/knife
= Tk. 200 × 13 shifts (we need to change one knife for that 0.67 shifts anyway)
= Tk. 2,600 = 21.67 USD
In the case of band knife, knife is replaced once after 2 shifts.
= Tk.350 × (13/2)
= Tk. 350 × 6.5 ~ 7
= Tk.2,450
= 20.42 USD
Total machine rental expenses = Tk. 2,600 + Tk.2,450
= Tk. 5,050
= 42.08 USD
Step 5: Calculation of overhead costs
Total overhead expense is provided as Tk.1,50,000 per 30 days month
………………..1,50,000
Cost / day = ————
……………………30
= Tk. 5,000
Company works for this order only 12.67 days. Hence,
= 5,000 × 12.67
= Tk.63,350
= 527.92 USD
Step 4: Calculation of total cost
Total cost = Labor cost + Material cost + Machine cost + Overheads
= Tk. 46,118.8 + Tk. 38,760 + Tk. 5,050 + Tk.63,350
= Tk. 1,53,278.8
= 1,277.32 USD
…………………………………….Total cost
Cutting cost / garment = —————————-
…………………………………Order quantity
…1,53,278.8
= ———————
…..38,000
= Tk. 4.03 = 0.034 USD
The cutting cost of the garment is Tk. 4.03 or 0.034 USD
References:
- Handbook of Textile and Apparel Costing by Rathinamoorthy, Surjit and Vishnu Vardhini
- Apparel Merchandising by R. Rathinamoorthy and R. Surjit
- Garments Merchandising by M.A. Kashem
- Practice of Garments Merchandising and Management by Engr. Md. Faruq Hosen
