04.The real cost of clothing
Brands source clothing by bargaining with suppliers on price. This price usually equates to 10-20% of the retail price and includes everything involved in the garment’s production up to the point of shipping, including fabric, manufacturing and middlemen’s profits. Macquarie Bank research estimates such production costs for a pair of jeans retailing for $US109 to be $US12.
While the labour costs involved with a garment are only a small part of the total cost of sourcing the product, many brands still seek to cut costs at this level, shifting their production to Bangladesh or the western provinces of China.
Where do our clothes come from?
Based on value, 92% of clothes sold in Australia are imported, according to the Council of Textiles and Fashion Industries of Australia. While China still dominates the textiles market for imported clothes, imports from low cost countries such as Bangladesh and Cambodia have been increasing at a rapid pace.