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Garment Costing Calculator
Full garment cost sheet — fabric, trims, CM, overhead and profit.
CostNest Calculator
Buyer & Agent Commission Calculator
Compute purchasing margins, sourcing agency commission payouts, and net factory revenue. Supports both inclusive (deducted from FOB) and exclusive (added on top) commission methods. No account needed — numbers update as you type.
Buying house commissions directly impact the garment's target Cost of Making (CM) and overall FOB pricing. Aligning on whether a price is commission-inclusive avoids invoice disputes during shipping.
Step By Step
How to Use This Calculator
6 steps
- Set the currency ($ for USD, ৳ for BDT, € for EUR, or £ for GBP).
- Enter the Quoted FOB Price per garment piece agreed with the client or factory.
- Choose the Commission Strategy: Deducted (commission is already built-in) or Added (commission is calculated on top of the base FOB).
- Set the Agent or Buying House Commission Rate percentage (standards typically range between 3% and 8%).
- Provide the Total Order Quantity to instantly calculate order-wide totals and payouts.
- Inspect the Share Split visualizer showing the exact division between the factory share and agent revenue.
Worked Example
Worked Costing Example: T-Shirt Sourcing Program
Use this sample to sanity-check your inputs and understand what the final result represents.
- 1Quoted FOB price: $4.50 per piece
- 2Commission Rate: 5% (Sourcing Agent margin)
- 3Order Volume: 50,000 pieces
- 4Under Deducted Strategy (Inclusive): Commission = $4.50 × 5% = $0.225 per piece. Net Factory Payout = $4.50 - $0.225 = $4.275 per piece.
- 5Under Added Strategy (Exclusive): Commission = $4.50 × 5% = $0.225 per piece. Total Buyer Price = $4.50 + $0.225 = $4.725 per piece.
Final Result
For 50,000 pcs (Inclusive): Total Invoice = $225,000 | Agent Commission = $11,250 | Net Factory Revenue = $213,750.
Methodology
Buying Agent Commission Costing Formulas
This section explains the calculation logic, assumptions, and source material used to make the result more trustworthy and easier to verify.
1. Deducted Strategy (Inclusive of Commission): · Agent Commission ($/pc) = Quoted FOB × (Commission % / 100) · Net Factory Price ($/pc) = Quoted FOB - Agent Commission · Total Invoice Value = Quoted FOB × Order Quantity
2. Added Strategy (Exclusive of Commission): · Agent Commission ($/pc) = Base FOB × (Commission % / 100) · Total Buyer Billing Price ($/pc) = Base FOB + Agent Commission · Total Invoice Value = Total Buyer Billing Price × Order Quantity
Practical Guidance
Merchandising Strategies for Buying Agent Commissions
- 1Always verify whether the buyer's target price is Commission Inclusive (Deducted) or Commission Exclusive (Added) before submitting the final costing sheet.
- 2For high-volume bulk orders (e.g., above 100,000 pieces), negotiate a sliding commission scale (e.g., 5% on the first 50k, 3% on the balance) to secure the contract.
- 3Be aware of foreign currency conversion charges and intermediate bank transfer fees that can erode the net commission payout by 0.5% to 1.5%.
- 4Incorporate quality inspection services and pre-production testing fees inside the commission buffer to protect your agency margins.
- 5Ensure that your commission agreement specifies whether commission is payable upon Letter of Credit (L/C) opening, shipment dispatch, or final payment realization.
Frequently Asked Questions
What is the difference between Deducted and Added commission strategies?+
Under the Deducted (Inclusive) strategy, the agent's commission is already included inside the quoted FOB price. The buyer pays the quoted price, and the factory pays the agent their share. Under the Added (Exclusive) strategy, the factory quotes their net manufacturing price, and the agent's margin is calculated and billed on top of that base price.
What is the typical commission rate for apparel buying agents in Bangladesh?+
Standard buying house and liaison office commission rates range from 3% to 8%. Complex styling, smaller order quantities, or packages including detailed QA supervision and fabric sourcing support typically command higher commission rates.
Does agent commission cover shipping, samples, and courier costs?+
Usually, standard commission agreements only cover sourcing services and quality inspections. Sample production, trim approvals, and international couriers are normally billed separately unless explicitly stated in the agent contract.
How is the buying agent commission treated under customs valuations?+
For inclusive FOB quotes, the commission is integrated into the declared customs value (FOB). For exclusive/added commissions, rules vary. Under Bangladesh NBR and international customs rules, buying commissions paid to sourcing agents are generally excluded from the transaction value for duty assessment, provided they are declared separately.
What payment terms are standard for releasing buying house commissions?+
Commissions are typically released after the factory receives the export proceeds (Bank Realization Certificate or BRC). Sourcing houses negotiate direct payment from the buyer's LC or receive local bank transfers from the factory within 15–30 days of shipment payment realization.
How do intermediary bank fees affect agent commissions?+
International telegraphic transfers (T/T) and foreign L/C negotiations involve advising bank fees, swift fees, and correspondent bank margins. Sourcing agreements should clearly define who absorbs these transaction expenses to prevent disputes.