Evaluation

Evaluation is about assessing items already on sale, whether they are made by your company or someone else’s, and finding out what is good and bad about them. This helps you produce items which have features that people want, and not to repeat mistakes, or give them features they don’t want.

It is also about examining quality, and taking note of how things stand up to wash and wear.

Costing and pricing

Costing and pricing is about making sure that you are not selling for too little, or too much.

Costing is about finding out exactly what it costs to make a particular item in the factory. You need to know how much all the fabrics, yarns, trims and so on have cost to buy (and store) in the first place. Then you need to work out what it costs in energy (electricity, gas or coal) to run machines and to heat and light the factory. You are probably also charged for water.

Another very important cost is labour – that is, what wages you have to pay. Labour costs will also include what the employer has to pay towards pensions and insurance. Then there is the cost of packaging – this may include hangers, plastic bags, boxes and price tickets. Finally, there is the transport cost of getting the items to the shops.

The factory is probably making lots of different lines at the same time each with different materials, so the calculations can be very complicated

Pricing is about deciding what each item will be priced at in the shops. A price has to be fixed which allows a profit margin, but also allows the company to be competitive. If your produce is too expensive, no one will buy it. In fact, there are probably two profit margins to consider – the profit the factory needs to make in selling to the retailer and the profit the retailer needs to make in selling to the customer.