Offshore V’s Onshore Production- The Pros and Cons
Of all the enquiries we receive at Sample Room the most heartbreaking involve offshore production. Whether it is the money lost, the time lost or the frustration. On the flip side we love creating a smoother development process that involves offshore production BUT with pattern and sample development locally so you can ensure the right product is made the first time, saving time, money and frustration.
The choice between offshore and onshore manufacturing is not a clear one to make when you are starting your label. You may have heard of cheap prices etc. To make a clear decision it is important to know the pros and cons for both. A bit of background information including a few examples of how other people work as well as some examples of where it can go wrong and you can make a more informed choice.
I have worked with both, local manufacturing and offshore in China, Fiji and India.
The first thing you need to be clear about is quantity.
Offshore manufacturing is generally about large qty production. This is one way they are able to offer lower prices (we will talk about this further later)
I have heard of manufacturers who are happy to make small qty but their prices are high and normally somewhere along the production schedule you become less of a priority when someone come in with a larger order.
Local manufacturing is more accommodating to smaller qty. You can find manufactures who are happy to make qty of 100 per style, 50 per style, even 20 per style. This can be over a few colours.
Overseas if you are looking to these small qty they will be made in a sampling room where you are competing with space from large qty production who are using the sampling room for samples. They will take priority. Generally overseas manufacturers would like 1000 per style (can be approx. 3-4 colours)
Price-
Yes is seems the price from an offshore factory is lower than local manufacturing. It is important to factor in a number of extra costs. Freight, import duty, Hiring a QC person to check the quality, you also really need to make a visit to the factory to check your production to make sure it is what you want. Even the price of couriers between overseas factories for samples, and trims for approval can add up (this can be $100 each way). Not to mention if you need to airfreight to reach a tight delivery which can add $7 to the price of a garment. I think offshore manufacturing works is you are making 20 different styles and 1000 pcs and you are traveling back from an overseas buying trip via your overseas manufacturer. On top of these hidden costs there is also an issue with faulty goods. You will normally have to pay for the full production run before it is shipped and if you find when you receive the goods to your office that there are problems that will need to be fixed at your cost. It is rare that you will receive a refund for these faulty goods. (This one is from experience). I have visited a few clients who have rooms full of clothes that are incorrect and they cannot sell them. They still had to pay for them but they just take up space now.
Delivery and lead time- the general rule with offshore lead time is a month for fabric development, a month for making and a month for shipping. BUT you would have to have a very good relationship with your manufacturer to guarantee this delivery. I have been in the situation where 3 months after I have placed a large order I have found out they have not even started fabric. (This order was pulled out and send to Fiji)
Locally you can have your stock made in 1 month. This is with supplying patterns, fabrics and trims to the manufacturer.
Offshore delivery can be held up for months with approvals shipped back and forth, busy production times or just that you are pushed back in the production schedule.
Travel-
Well I always say it is easier to go to Sunshine (local to Melbourne with a few manufacturers) then it is to China to sort out an issue. If you are working with a local manufacturer then it is much easier to go across town and sort out any issue then communicate over computer and try to work out what the issue is. If you are looking to local manufacturing you can also be there to ensure nothing is held up and your delivery times are met. I have heard on more than one occasion of designers collecting their order and delivering to a major department store in order to reach a delivery just in time.
Patterns-
This is a personal favourite of mine- People say that the factory overseas will make a pattern for me. It is important to understand that if you don’t pay for it then you don’t own it. A large proportion of my job is tracing off garments that were made by an overseas manufacturer who NEVER sends the pattern. We also do a lot of work with poorly fitting patterns. It depends on what you goal is. If you are looking for good quality well-fitting patterns that are made especially to a fit that you know then I would probably not suggest offshore pattern makers. If you are designing for America use an American pattern maker. If you are designing for Asia use an Asian patter maker. If you are designing for Australia then use an Australian pattern maker. Each pattern maker knows their own demographic the best and what the works to the body shape. Years ago I was a wetsuit pattern maker and we were trying to move into the Asian market. I did a lot of research on the Asian body. It is not only different in sizing but bone structure. This was quite a change from the blocks I used and the way I thought about a pattern.
If you are copying garments direct then it won’t matter. Except you need to be happy with the fit before it starts. Fit issues often come from the core block and pinning out a side seam will not always be enough. Going back to the base block is often the only solution. But anyway, this one is up to you. Just keep in mind you get what you pay for.
FOB or CMT-
Apart from these being shipping terms (another area you will need to know if you are working overseas) this will also determine how you work with a manufacture.
FOB manufacturing means they find everything- fabrics, buttons, elastic, and fusing
CMT manufacturing means you send everything to them and they make the garment.
My Top Tips-
Start local for the first 2 seasons at least- it is easier to explain and understand what is needed by working with a local supplier then to work with someone who is thousands of miles away. In the beginning you will not even know what to expect with the questions that will be asked.
You can produce smaller number, delivery on time, get paid then make more if the style is working. You are better off selling 100 pcs then make 1000 and only selling 100.
Once your label is tracking along nicely then you can look to expand out. I personally like Fiji for a first step. They are close to Australia, it is nice to visit, it does not take to long for your goods to travel there and back and if there is a problem it does not cost as much to travel over there.
Once you are well established, know the ins and outs etc you can look further afield.
Whether you are working locally or offshore, working with a local pattern maker and sample maker on your first samples will definitly result in a smooter process and a happier path to your end production.