|
Factors | | | Location of garment manufacturing |
| | Make in-house | Domestic supplier | International subsidiary | International supplier |
|
Hourly compensation or labor cost per hour | 40 | 40 | 4.28 | 4.28 |
Number of hours consumed on one occurrence of set-up | 1.2 | 1.2 | 1.2 | 1.2 |
Number of workers assigned to one occurrence of set-up | 8 | 8 | 8 | 8 |
Overtime allowance per hour | 50% | 50% | 50% | 50% |
Number of hours consumed per one occurrence of overtime | 2.5 | 2.5 | 2.5 | 2.5 |
Number of workers assigned to one occurrence of overtime | 12 | 12 | 12 | 12 |
Percentage of unit production cost which is comprised of labor cost | 50% | 50% | 25% | 25% |
Transportation cost for an average garment (% of unit production cost) | 5% | 5% | 20% | 20% |
Transaction cost for an average garment (% of unit production cost) | 2% | 3% | 10% | 10% |
Number of items in each assortment | 2000 | 2000 | 2000 | 2000 |
Total cost of manufacturing (Different for each destination) | Assumed | 10% higher than in-house | 50% lower than in-house | 10% higher than subsidiary |
Percentage of assortment sold | 83%–100% | 83%–100% | 83%–100% | 83%–100% |
Inventory holding cost for obsolete stock | 12% of obsolete stock |
Case A | | | | |
Premium freight disruption cost from (i) Fabric suppliers to garment manufacturer; (ii) garment manufacturer to retailer | 3000 | 3000 | 12500 | 12500 |
Premium freight disruption cost from trims and accessories suppliers to garment manufacturer | 200 | 200 | 250 | 250 |
Case B | | | | |
Premium freight disruption cost from (i) fabric suppliers to garment manufacturer; (ii) garment manufacturer to retailer | 12500 | 12500 | 3000 | 3000 |
Premium freight disruption cost from trims and accessories suppliers to garment manufacturer | 250 | 250 | 200 | 200 |
Case C | | | | |
Premium freight disruption cost from (i) fabric suppliers to garment manufacturer; (ii) garment manufacturer to retailer | 12500 | 12500 | 12500 | 12500 |
Premium freight disruption cost from trims and accessories suppliers to garment manufacturer | 250 | 250 | 250 | 250 |
|
Company category | Elements of complexity | Type of cost | Predefined disruption factor without impact of assortments |
|
Case A | | | | | | |
Fabric suppliers | 30–48 | Premium freight | 0.50 | 0.55 | 0.63 | 0.70 |
Trims and accessories suppliers | 15–54 | Premium freight | 0.50 | 0.55 | 0.63 | 0.70 |
Garment manufacturing |
50–84 | Premium freight | 0.25 | 0.28 | 0.31 | 0.35 |
Overtime | 0.25 | 0.28 | 0.31 | 0.35 |
Set-up | 0.25 | 0.28 | 0.31 | 0.35 |
Case B | | | | | | |
Fabric suppliers | 30–48 | Premium freight | 0.63 | 0.70 | 0.50 | 0.55 |
Trims and accessories suppliers | 15–54 | Premium freight | 0.63 | 0.70 | 0.50 | 0.55 |
Garment manufacturing |
50–84 | Premium freight | 0.31 | 0.35 | 0.25 | 0.28 |
Overtime | 0.31 | 0.35 | 0.25 | 0.28 |
Set-up | 0.31 | 0.35 | 0.25 | 0.28 |
Case C | | | | | | |
Fabric suppliers | 30–48 | Premium freight | 0.63 | 0.70 | 0.63 | 0.70 |
Trims and accessories suppliers | 15–54 | Premium freight | 0.63 | 0.70 | 0.63 | 0.70 |
Garment manufacturing |
50–84 | Premium freight | 0.31 | 0.35 | 0.31 | 0.35 |
Overtime | 0.31 | 0.35 | 0.31 | 0.35 |
Set-up | 0.31 | 0.35 | 0.31 | 0.35 |
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