Follow the Cotton: Where the Money in a Shirt GoesWho Captures the ValueContent for Intellectualsmagazine.berelentless.in
19 October 2026 · 8 min read · 19 reads
One shirt, the chain behind it from cotton to brand, and a careful look at who captures the value at each step.
Look at the shirt you are wearing. Somewhere, a farmer grew the cotton in it. A mill spun the cotton into yarn. Another factory knitted or wove the yarn into fabric, and another cut and sewed the fabric into a garment. A company put its name on that garment, and a shop sold it to you.
Here is the question this piece asks: out of what a customer pays, where does the money go along that chain? The honest answer is "it depends, and the public data is thin." So this article sticks to what can be sourced, labels examples as examples, and leaves out figures that do not hold together. The aim is a clear picture of the value chain and of why money gathers in some links more than others, which is a
Growing the cotton. Cotton is a farm crop, grown in many countries. In India, one well-known cotton region is Vidarbha, in the state of Maharashtra. Wikipedia's page on the region says it has 11 districts and about 23 million people in the 2011 census, that oranges and cotton are major crops, and that Amravati and Yavatmal are known for cotton. The farmer's product at this stage is raw cotton, which is sold to others to process.
Spinning yarn. A spinning mill turns raw cotton into yarn. The yarn is the thread that later becomes fabric.
Making fabric. Yarn is knitted or woven into cloth. The cloth is usually dyed or finished at this stage or soon after.
Making the garment. A garment factory cuts the cloth and sews it into shirts. This is where most of the labour in the chain sits.
Owning the brand. A clothing company designs the product, puts its name on it, and sells it, either in its own shops, online, or through retailers. The company does not always do the making itself. Often it pays factories to do it.
Delivery and sale. The finished shirt travels to the customer, sometimes across oceans, and is handled in warehouses, packed and delivered.
Each link has its own costs and its own risks, and each takes a share of what the customer finally pays. The shares are not equal, and they are not the same from one product to the next.
The clearest set of public numbers comes from a radio project. NPR's Planet Money team made a T-shirt and tracked its costs, then published the details in a transcript. In that transcript, customers paid $25 for the shirt.
Here are the items the transcript states for that one shirt:
The transcript also lists costs that most shirts do not carry, because this project sold directly to customers who had funded it online: $2.25 in crowdfunding and payment fees, $1.79 for warehouse handling, $0.90 for printing, and $2.26 for final delivery to customers.
Two warnings belong with these numbers. First, this is one unusual project, with a crowdfunding site and a warehouse in the picture, so it is an example and not an industry average. Nobody should read it as "this is how a shirt is priced." Second, the transcript's own running totals do not fully add up to the $12.42 it gives as the total cost, so only the individual items are used here, and not the totals.
Even so, one thing is clear from the individual items. The raw cotton was a small slice of the final price, and the payment to the clothing company was the largest single item. That is a good starting point for asking what the other slices pay for.
The same transcript adds some detail about how long the chain is. It says about 32 people worked on one shirt, and that the shirt travelled more than 10,000 miles, including several weeks at sea. That is a lot of handoffs for a product that costs a customer a few dollars, and each handoff is a place where someone takes a fee, a margin or a cost.
When a chain is this long, it is easy to forget how many separate businesses are inside it. A farm, a spinning mill, a fabric mill, a garment factory, a shipper, a warehouse and a brand are all different kinds of business. They have different customers, different costs and different amounts of pricing power. That difference in pricing power is the key to the rest of this piece.
Wikipedia's page on fast fashion (see the sources below) uses the Merriam-Webster definition: a way of designing, making and marketing clothes that emphasises making fashion trends quickly and cheaply available. The page says the model grew in the late 20th century through more efficient supply chains, quick-response manufacturing, low-cost labour in Asia, and cheaper synthetic fibres made from petroleum.
Put that next to the example above. A system built for speed and low cost has to make each link efficient, and it rewards the businesses that can move quickly, plan well and keep their costs down. It also gives a lot of weight to whoever coordinates the whole chain, because that business decides what is made, where, and in what quantity.
No trustworthy public figure says "the brand takes X% and the cotton grower gets Y%" for a normal shirt, and this article does not invent one. What can be said is based on how the pieces fit together. The points below are editorial reasoning from the example and from basic business logic, and not findings from a study.
Commodity inputs have little pricing power. Many growers produce cotton that is close to identical, so a single grower usually cannot set the price. A seller of a commodity tends to take what the market gives. The same idea applies to any business that sells something that others also sell, to the same standard.
Brands own the customer. A brand is the part of the chain that buyers see and recognise. A name is hard to copy, and it lets a company decide a price and keep the relationship with the person who pays. In the Planet Money numbers, the payment to the clothing company was the largest single item, though the transcript says about $2 of it covers cotton, spinning and labour. That is one example
Coordination is valuable. The business that decides what is designed, which factory makes it, and how it reaches the customer carries a lot of the planning and the commercial risk, such as unsold stock. It tends to be paid for that role.
Easy-to-replace work earns thinner margins. When a customer can switch from one supplier to another with little cost, suppliers compete mostly on price. When a business offers something hard to copy, such as a skill, a name or a relationship, it competes on more than price.
The pattern behind all four is simple: money tends to gather where there is control. Control of a brand, of the customer, of a hard-to-copy skill. It tends to leave places where the product is easy to replace.
If the pattern is "money gathers where there is control," the question for any business in a replaceable position is how to gain some. These are general ideas from other businesses, not advice for any one industry.
Each of these has costs, and not every business has the money, time or access to try them. They are directions to explore, not guarantees.
The lesson is not "brands good, growers bad," or the reverse. People who grow cotton, spin yarn, sew shirts and sell them are all doing real work. The lesson is about position.
If you sell something that others also sell, with the same quality, you are closer to the cotton than to the brand. Your customers will compare you on price. If you want more control, you have a few directions to explore: build a name people ask for, own the relationship with your customer, become really good at a narrow thing, or take over a step of the chain that you were handing to someone else.
Asking where your own business sits in the chain is a better start than working harder at the same position.
A neat percentage would have been satisfying, and the public data does not give one. What it gives is a way of looking at a product: ask who can set the price, who owns the customer, and who carries the risk if things go wrong. The answers tell you a lot about where the money goes, and the same three questions work for almost any business.
Try this week: Pick one thing you sell or buy often. Write the chain behind it in four or five steps, from raw material to you. Next to each step, write who has the most control and who carries the most risk. If you cannot answer, that is your research for the week.
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