The final costing sheet also includes the labor and overhead (LOH) costs.
Hence the variation of 5% due on the account of currency conversions to the US dollar.
For as long as we can remember, we’ve been reading comments such as these on the internet: ‘ Nike makes their shoes for dollars.’ ‘ The Yeezy Boost costs to make and adidas sells it for 0. ‘ Sneakers could be considerably cheaper if brands stopped paying all that money to Kanye West, Stephen Curry and Lebron James’.
‘I bought a shoe worth 0 for just on Black Friday, and the shoe company is probably still making a lot of money.’ Frankly, we’re surprised that no one has published exact manufacturing costs , considering this is such a widely discussed topic, and the cost information isn’t particularly hard to get. Back in 2014, Matthew Kish, a journalist with the Portland Business Journal did write about the average cost to make a pair of 0 shoes.
Think of it as a list of ingredients in a cooking recipe, except that the list is marked with how much each ingredient cost you to purchase.
For a typical running shoe, the BOM will add the consumed cost of synthetic leather, mesh, threads, logos/inks, trims, midsole, outsole etc.