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COGS (Cost of Goods Sold)

The direct aggregate cost incurred to manufacture and package a physical garment, excluding indirect operating expenses like marketing, software, and rent.

Also known as:Cost of SalesDirect Manufacturing CostUnit Production Cost
Key Definition & Direct Answer

COGS (Cost of Goods Sold) in apparel manufacturing encompasses the direct material and labor expenses required to produce a finished, packaged product. For a custom t-shirt brand, COGS includes the blank garment cost, print decoration fees, custom woven or printed neck tags, polybag packaging, package inserts (packins), and inward factory freight. Accurate COGS accounting is fundamental for establishing retail pricing and calculating gross profit margins.

Technical Specifications at a Glance

Core Formula
Blank Garment + Printing + Branding + Polybag
Excludes
Ad Spend (CAC), Office Rent, Shopify Fees, Salaried Staff
Healthy Apparel Target
COGS should not exceed 25% to 33% of Retail Price
Target Markup
3x to 5x of COGS for Profitable D2C Scaling

Building an Accurate Apparel COGS Breakdown

Founders who only count the price of the blank t-shirt frequently wake up to find their business is losing money. A true apparel COGS includes every direct component that touches the physical item before shipping:

1. Blank Heavyweight Cotton T-Shirt (240 GSM): ₹245

2. Industrial DTF Print (A3+ Full Front): ₹50

3. Custom Heat-Transfer Inside Neck Label: ₹10

4. Matte Black Frosted Zip-Lock Polybag: ₹12

5. Thank-You Brand Card & Sticker Packin: ₹8

Total Physical COGS: ₹325 per unit. To maintain healthy D2C profitability after Facebook ad costs and logistics, this garment should be retailed between ₹999 and ₹1,499 (a 3.0x to 4.6x markup over COGS).

Industry Comparison Matrix

Expense ItemIncluded in COGS?Financial Classification
Raw Blank T-Shirt & PrintingYESDirect Material & Manufacturing Cost
Polybag & Neck Brand LabelsYESDirect Packaging Material
Instagram Ad Spend (CAC)NOOperating Marketing Expense (OPEX)
Shopify Monthly SubscriptionNOGeneral & Administrative (G&A)

Buyer & Quality Inspection Protocol

  • Update your COGS ledger whenever fabric tier pricing or printing dimensions change.
  • Audit bulk volume tier breaks: increasing batch size from 20 to 100 pcs reduces unit COGS by 15% to 25%.
Factory Blanks Catalog

Apparel Blanks Featuring COGS (Cost of Goods Sold)

View Full Catalog
Oversized Drop-Shoulder T-Shirt (240 GSM)
240 GSM

Oversized Drop-Shoulder T-Shirt (240 GSM)

100% Cotton Premium Bio-Washed • Heavy Gauge Loopknit French Terry • Streetwear Boxy Cut

Bulk As Low As
₹213 /pc
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Frequently Asked Questions

What is a healthy COGS percentage for an Indian streetwear brand?

In profitable Indian D2C fashion brands, COGS typically represents 20% to 30% of the final retail price. For example, a ₹999 oversized tee should ideally have a complete COGS under ₹300.

Related Glossary Terms

Finance

Gross Profit Margin

The percentage of retail sales revenue remaining after subtracting direct Cost of Goods Sold (COGS), representing the capital available to pay for marketing and operations.

Business

MOQ (Minimum Order Quantity)

The lowest quantity of garments a textile mill or printing factory requires a buyer to order per design, colorway, or production run to begin manufacturing.

Business

RRP (Recommended Retail Price)

The suggested retail price benchmark recommended to merchants to ensure healthy gross profitability across marketing and fulfillment costs.

Finance

COD Remittance

The formal financial reconciliation cycle where courier companies transfer collected cash from delivered COD parcels back into the merchant’s bank account.

Source Certified Tirupur Cotton with 50/50 COD Milestone Escrow

Get 100% combed cotton blanks custom printed with high-definition DTF. Order a single ₹349 sample kit or place a bulk wholesale run starting at just 10 pieces.

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