— A simple and practical guide for garment industry success

In the garments or apparel business, a senior merchandiser is not just a follow-up person. They also need to think about money. From the first sample to final shipment, a merchandiser must plan the budget and watch how the money is spent.

In this article, we’ll explain in very simple words how you can do effective budgeting and monitoring in your daily merchandising work.

What is budgeting in merchandising?

Budgeting means planning how much money is needed for an order or season. It includes:

• Fabric cost
• Trims & accessories cost
• Making cost (CM)
• Printing, embroidery
• Testing or lab charges
• Sample and courier cost
• Shipping and delivery cost
• Wastage and extra buffer

If you don’t plan all these carefully, your company can lose profit.

Why budgeting is important for senior merchandisers

Let’s say you confirm an order without full costing. Later, fabric price goes up, or trims cost more. Now what? Either your factory takes a loss, or you fight with the buyer — both are bad.

Good budgeting helps you:

• Keep control of cost
• Avoid last-minute surprises
• Maintain profit for your company
• Give the best price to buyers confidently
• Win respect from your management

How to create a simple & clear budget

Let’s go step-by-step, like real-life merchandisers do on the floor:

Step 1: Understand the order

Take time to fully understand:

• Style name and number
• Quantity
• Fabric type
• Trims and design details
• Any special wash, print, embroidery

Don’t guess. Ask buyer if anything is unclear.

Example: If the style needs digital print, that cost must be added. Otherwise, it will create loss later.

Step 2: Collect prices from suppliers

Talk to:

• Fabric supplier ( spinning mill, dyeing factory, knitting factory)
• Trim supplier
• CM (making cost) from production
• Print/embroidery vendor
• Label and packaging suppliers

Get real prices. Don’t take old or assumed prices.

Tip: Use WhatsApp or email to get quick responses from vendors.

Step 3: Make a simple excel costing sheet

Use Microsoft Excel or Google Sheets. Make simple columns like this:

Item	Unit Price	Quantity	Total Cost
Cotton fabric	$1.30	1000 pcs	$1300
Accessories	$0.25	1000 pcs	$250
Chest print	$0.17	1000 pcs	$170
CM (Making)	$0.34	1000 pcs	$340
Commercial	$0.15	1000 pcs	$150

Then, add all and calculate total cost per piece.

Step 4: Add wastage and buffers

Always keep some buffer like:

• 3-5% for fabric wastage
• $0.05-$0.10 buffer for exchange rate or price change
• Extra $100–$200 for urgent courier or rework

Real-life lesson: Many merchandisers forget courier costs or rework. Later, they regret it

Step 5: Save the final budget sheet

Save it in a shared folder or Google Drive. Share with your team (manager, production, accounts). This is your “final plan” for this order.

How to monitor the budget during order progress

Budgeting is not just one time. You also need to track the spending during order production.

Use a budget monitoring sheet

Make a second sheet like this:

Item	Planned Cost	Actual Cost	Difference	Reason
Cotton Fabric	$1300	$1350	+$50	Price increased
Chest print	$170	$170	$0	As planned
CM	$340	$440	+$100	Line delay

Update this sheet weekly or when you spend money.

Meet weekly with team

Once a week, sit with your sourcing, factory, and accounts team.

Ask simple questions:

• Any cost increase?
• Any extra spending?
• What is under control?

This small habit will save thousands of dollars per order.

Use simple tools (free)

You don’t need expensive software.

You can use:

• Google Sheets – for live budget sharing
• Trello – for tracking order stages
• WhatsApp group – for real-time updates

These tools are free and work well for small or medium factories.

Real example from a garments factory

A merchandiser at Muntaha Knitwear Ltd. forgot to add the wash test cost in the budget. After final bulk, the buyer asked for an Azo-Free certificate. That cost $400 and had to be paid urgently. It was not in the budget. It came out of the merchandiser’s monthly profit.

Since then, their team made a checklist for every order and never skipped budgeting again.

Common mistakes to avoid

🚫 Not updating cost sheet after changes
🚫 Using old price data
🚫 Forgetting to include testing or courier cost
🚫 Giving price to buyer before checking all costs
🚫 Approving urgent trim without approval

Final tips for success

• Always double-check numbers
• Keep clear communication with buyer and vendors
• Update sheets weekly
• Train your junior merchandisers about cost tracking
• Keep every document saved in one folder (email, quotes, costing sheet, invoice)

Remember: Budget is power

If you can control the cost, you can control the business. Senior merchandisers who master budgeting become valuable to the company.

💬 “Good merchandisers follow up, but great merchandisers follow the money.”