How can I tell if a sewing or cut-and-sew business is actually profitable?

A sewing contractor can look busy and still earn little. Its income depends on how many minutes a garment takes against what was quoted, and small errors repeat across every order. Ask the seller to show how the books connect to the floor. The checks below help you see that link, and your accountant can read the statements with you.

Costing against real minutes

Ask how each style is priced and whether anyone times the work. Compare the quoted time with what the operators actually spend, using a few recent orders. If the costing sheet is a guess, or was set years ago, expect the real result to differ. Ask how the owner adjusts prices when a style turns out harder than expected.

Rework, seconds and the owner’s own labour

Garments that fail inspection are sewn twice or sold as seconds, and both cost money that the order price does not cover. Ask how rework is tracked. Then ask how many hours the owner spends sewing, cutting or training, and whether those hours are paid. If the owner covers a gap for free, a replacement will have to be paid.

Idle weeks, fabric and leftovers

Many shops have quiet stretches when staff are still paid. Look at the monthly picture, not just the year. Ask how fabric shrinkage and cutting waste are handled, and whether leftover fabric from finished orders sits on the shelf. Ask how stock like that is carried on the books.

See also what to check before buying a clothing manufacturer and what makes an embroidery or screen-printing shop profitable.