Finding Your Factory

If you're interested in making your own product and/or clothing line, one of the earliest tasks you'll have will be to find the right factory to produce your goods.

At first, this will feel overwhelming, exhausting, and panic-inducing. It should be. The wrong choice can put you in a bad situation. It could force you to use too many resources and spend too much money all while spiraling you deep into the sunk cost fallacy. Worst of all, it can stunt your future growth.

You'll need to do some due diligence to make sure the factory that you sample with can also produce your final goods with the same level of quality and on time.

It comes down to several different aspects outlined in the blog below. Follow it to start with success and use it as a regular reference to test and check new vendors.

You additionally might also have extra credentials that you'd like to see in a factory, like being GOTS, OEKO-Tex or Fair Trade certified. Once you decide what matters most, ask for certifications and check them for legitimacy against the records and resources available to you. GOTs has an online public database you can check here. Fair Trade International has a great tool for checking on your factory choices as well. OEKO-Tex allows you to check the label on their online tool to check if a certificate is valid. The internet is awesome, right?

1. Capabilities:

One of the first questions you'll need to ask yourself: Is this manufacturer and team trained and experienced enough in your area to make your garment or product?

To figure this out, I like to ask a manufacturer what types of products they are most capable of making. I ask them for photos of products that they've recently produced on their production lines. Another way to understand what they're most successful at producing would be to ask them for a percentage breakdown of the types of garments they sell and produce annually.

To map it out visually, if you're trying to make top hats (because . . . why not?) and the factory produces the products to match the pie chart here, then you might be barking up the wrong tree!

However . . . if you're looking to make swimwear, this would be a great percentage breakdown for a potential manufacturer. Most of their time is spent working on swimwear or swimwear's close cousin, intimate apparel. Activewear is also a close cousin to swimwear and intimate apparel, so if you see that as a high percentage of their product, you should also consider them!

2. Minimum Order Quantities (MOQ):

This is the smallest number of units you can order for a single style and/or color. Minimum Color Qualities (MCQ) are related and can sometimes be the same as the MOQ. For instance, some factories might have an MOQ of 1,000 units but they can be split between 2 colors because their MCQ is only 500 units. Another factory might just have an MCQ of 500 and that is also their minimum order. It all depends, so ask!

Minimums are not always described the same way, sometimes they are based on the fabric weight, yardage, or pieces. Almost all factories are willing to negotiate either a surcharge or a higher rate per item if you're unable to meet their minimums. When you're asking what their MOQs are, ask them how flexible they are with them to see if they're willing to work with you. Most factories are interested in working with direct-to-consumer brands these days as it's an ever-expanding market, so certainly pitch yourself as the brand to be partnered with!

3. Lead time:

To understand how quickly a manufacturer can meet your timing needs, you need to understand lead time. Lead time is the amount of time it takes to produce the garment after placing a purchase order, also known as a PO. Usually, it is given in days or weeks and the further from your home country that you go, the longer your lead time generally speaking.

So what is a good lead time? For some categories, a good lead time is 30 days, while for others 90 days is as quick as possible, speedy, even!

Unfortunately, there is no easy answer as it depends on what you're making. Simpler products with 1 or 2 components will usually have shorter lead times. Some factories house an array of basic raw materials for the exact purpose of turning goods out quickly. If you're making bras, though, a lot of materials are made to specs. A typical underwire bra has upwards of 15+ components, many of which need to be ordered and produced to match your finished colors and dimensions. You also should consider the time it takes to transport from the trim supplier to your manufacturer. Most often these businesses are local to your factory, but not always, and travel time matters.

Generally speaking, a lead time of 90 days is pretty average for bras, underwear, and swimwear made by an overseas manufacturer. For this time frame to work, it would mean that the garment design and fit were already finalized and confirmed at the time the PO was placed. Not all factories require the garment to be fit-approved when placing a PO + starting the clock on delivery, but many do.

The reason most factories want a fit-approved garment at the time the PO is placed is that an approved sample is like a bible for manufacturers. It tells them everything about what they need to order: how much fabric they need, trim quality, and hardware to order. Until a garment is fit-approved, anything is subject to change without notice, so factories are trying to order more strategically by waiting for an approved fit.

Ask them for a typical timing + action (T+A) calendar. Ask if they need a fit approval at the time of PO to ensure delivery that matches their estimated lead time. It's crazy but they'll just tell you these things if you ask. So be sure to ask!

If your manufacturer does need garments to be fit-approved before they can put you on a structured lead time calendar, then you'll want to consider all the development that goes on before the PO is placed to understand how quickly you can launch. Swimwear + bras can take anywhere from 3-12 months to develop depending on where you start. Starting from a purchased sample can cut your time down drastically, but make sure you're modifying it enough + bringing your own unique value. No one likes a copycat!

4. Production Capacity:

An important part of understanding your partners' ability t grow with you is knowing their production capacity. It's less complex than it sounds, I promise! Production capacity is how many total units they can make and ship in a certain amount of time, usually a month. Local studios in the US often have much lower production capacity than their overseas partners. Somewhere around 800 to 1,500 per month is not unrealistic for a small US factory, whereas some mega-factories in Asia are capable of producing over a million units a month! Talk about crazy!

When you're starting, you won't want to go to a mega-factory, though, as your orders will probably be too small (think: itty bitty) for them. They will have large surcharges for taking the small orders, you won't be a priority customer, and sampling will likely be on the slower side of things. Working with bigger factories is something you should consider as you contemplate your growth trajectory and potential. If your brand ends up being a rocket ship, you're going to need to consider this sooner rather than later.

To understand production capacity as it relates to growth, you'll have to have at the very least a strategic guess of where you plan to see your sales 1 year out from launch and every year after for 5 years to start. You might want to come up with several paths: an optimistic/stretch outlook, a realistic/attainable outlook, and a conservative, slothy outlook. I love sloths, but you don't want a slothy business.

With a few different outlooks mapped, you can better understand how quickly you might need to shift if things take off.

Consider this: you start your production with a factory that has a monthly production capacity of 800 units. Your first order might be for 300 units across 6 styles so there isn't a whole lot of room to grow if your brand and products take off quickly. What if you were featured on a big influencers account and sold out within a few days of launching? Momentum is everything in building a successful product line, especially early on. Running out of inventory within a few days and not being able to restock quickly would be detrimental to your business. But . . . your factory has a lead time of 60 days from PO and a monthly production capacity of only 800 units, so you're stuck. It'll halt your business before you've even waded into the shallow waters.

Sure, it would be awesome to sell out quickly, but when your supply can't meet the demand, those customers will look elsewhere or forget about you while you're waiting on that factory to finish in two months. If you plan to produce something quickly to get a minimum viable product (MVP), starting with a low-capacity factory is just fine, but if you believe there is a high chance of your product selling out quickly, you should dual-path your product at a manufacturer that could meet demand if and when it becomes necessary.

5. Ethical Working Conditions:

Improving the working conditions of those in the fashion industry is a major problem that many are working to correct, but we still have a long road ahead. More companies need to make caring for and improving the working conditions a top priority. If you're just starting your brand, consider creating a code of ethics and then commit and hold yourself to it.

If you're in the process of vetting a factory and you want to know more about the workers and how they're treated, the best way is to ask about the conditions. Some factories will even share photos of their living quarters --in many Asian factories, the workers live on campus, not at home with families! You can also use this time to ask about their wages as well. Visiting a factory is one of the most substantial ways to understand their working conditions, though that might not be an option when you're first starting out.

In addition to all the feedback you can get from a factory manager, you can also look for a few different certifications that help mandate the fair treatment of factory workers. Ask if they're accredited by WRAP or Fair Trade. These organizations are usually prominently displayed on the factory's website as it's quite an accomplishment! There are other organizations that help improve the conditions for factory workers such as the Fair Wear Foundation, Fashion Revolution, and The Ethical Trading Initiative.

One thing to consider when going with a factory that holds compliance certificates with WRAP or Fair Trade is that you're going to pay slightly more for your products. Be prepared for a 10% to 25% price increase compared to a factory that doesn't pay its workers a fair wage. Their lead times may be slower as well because these factories put limits on overtime to keep employees safe. These barriers shouldn't prevent you from considering the ethics of your business; they're just something to plan for as you forge ahead.

The global economy is shifting to a new future and it's hard to predict exactly how it will impact fashion at large. The age of the internet has made it harder and harder to conceal dangerous work environments and recent factory disasters have shed new light on this dark subject. Brands and businesses that put ethical practices and safe working conditions ahead of dollars are the future of this industry.

6. Sustainable Initiatives:

Another important aspect to consider is the sustainable initiatives that your factory has in place and/or will be putting in place. Every part of the production process is under intense scrutiny at the moment so there has been a lot of movement in the field of sustainability lately. From polybags made from biodegradable seaweed to new and nearly waterless dye treatments, there is room for improvement across all areas of fashion.

Consider working with a factory that prioritizes sustainability and has a path toward a more sustainable future. Ask them what they're concerned about in the industry and what they're working on when it comes to generating less pollution. Factories that care about this often pride themselves on it and they love to share with potential clients as they truly want to embrace the practices and hold themselves to high standards.

Some certifications you can look for when it comes to sustainability: GOTS (Global Organic Textile Standard), the Sustainable Apparel Coalition, BlueSign, Cradle to Cradle, Global Recycled Standard, and beyond.

If sustainability is your jam and you can't get enough, head on over to Common Objective to learn more, and connect with industry partners, factories, and brands that care as much as you do! Re/make is another organization that can provide education on sustainability and the ethical treatment of workers.

7. SAMPLES!!!:

One of the most important parts of vetting a factory is reviewing physical samples of garments they have produced. You can ask them to see an assortment of recently produced goods and then pick items that match the direction your product is going. It'll help you gauge whether they're capable enough to produce your line or product. Just about any factory should be willing to send you samples of products they've made at either very low cost or just the cost of shipping the goods to you.

This is where you need to pay attention. Consider the raw materials that make up the garments and how they feel. Some questions to ask yourself as you review samples from a factory:

Workmanship:

Reviewing the overall workmanship is a great first step in reviewing samples. You're trying to see how nicely everything was put together if it all looks correct, and if is it made to last.

• Are there loose threads or trims hanging off in any way or is everything clipped clean and perfected?

• Does it feel like it's well put together?

• How do the labels look? Are they sewn-in or heat-sealed?

Stitches:

Dig deeper into the actual stitches. For most garments with stretch, the higher the Stitches Per Inch (SPI), the better. Having too few SPI will result in your stitches breaking when stretched beyond what the stitch can endure. Ideal for swimwear and lingerie is usually between 12-16 SPI.

• How do they look overall? Are they straight and do they follow the edges?

• Can you tell if they reversed 3-4 stitches to finish?

• Did the garment crack when you stretch it? If so, those might be basting stitches and they should've been broken at some point during production. If the actual stitches are breaking that might be due to low SPI or incorrect tension in the machine.

• Do the stitches feel rough against your skin when you touch the interior side of them?

• Have you seen a variety of stitching operations in all the samples? Is there anything you're looking for that you haven't seen? Some factories struggle with a single zz stitch for instance.

Raw Materials:

Some raw materials are nominated by the brand, so they might not be the factory's first choice. Even still, you should consider how they look and feel as you will need to work with a factory of the right caliber depending on your price point.

• How do the trims feel? Luxurious? Cheap? Plasticky?

• How do the elastics feel? Do they recover when you stretch them?

• Does anything have stiff, scratchy edges or is it smooth, soft, and comfortable?

• If it's a padded bra, does it have a stiff pad or is it soft, comfortable, and flexible?

• Do the colors of trims match the expectation or are some items a few shades off from each other?

Once you've reviewed all your factory samples you should start to assign each factory a grade for each bucket. If they're straight A's in all categories but the raw materials aren't great, it might mean nominating or proposing your materials so that you can get the quality you're looking for. It might also mean that you're just looking at an inexpensive product, but the factory might be able to propose better materials for your styles. This is also why reviewing a range of products is important. If you have 4 or 5 samples to review you can get the best feel for who does what and their full range of capabilities.

8. Payment Terms:

Another important aspect to consider as you investigate factories is their payment terms. You want to make sure you understand their terms and agree with them or negotiate to make it work for both sides.

You will have to give some kind of deposit, usually 20% to 30% of the total order to secure the fabric and trims. The factory may require the rest of the payment upon boarding the vessel or delivery, depending on how they operate. You should always try to negotiate terms of net 30 upon receipt at your warehouse whenever possible. This allows you to run your own internal quality control checks and allows you to charge back the manufacturer for defective products.

The two most common types of terms are FOB and DDP/LDP. A lot of Asian factories are FOB as this is the easiest way to get the most cost-effective goods. Some factories opt for more inclusive terms of DDP or LDP but that is a premium service, so don’t expect most manufacturers to offer this option.

FOB stands for Freight On Board or Free On Board and this means that the price includes the goods and then getting them to a port of departure and onto the vessel for travel. You and your company will be required to plan the shipping vessel or air carrier details. You’ll be responsible for paying customs and duties as well as getting it from the port of arrival to the warehouse.

DDP stands for Delivered Duty Paid and this means that the price includes the cost of the goods and also customs duties and fees and usually it includes actual delivery to your warehouse or within a very close range. Since this is so inclusive, expect to pay a premium for the goods because you’re also paying for all of the previously mentioned fees; they just aren’t individually defined.

9. Making the call

How you make the final call is based on all of these points. You will have to weigh how much each of them matters and then decide based on all the information you have available to you. I would recommend finding at least three to five factories to vet thoroughly before deciding, but depending on your category, you might want to review more.

Picking your manufacturer is a lot like starting a long-term relationship. You both need to be committed to each other and willing to understand and consider the needs of the other to be successful. Don't decide too quickly and always have a backup plan in case things go south. With global epidemics like coronavirus spreading, you should also consider diversifying your product manufacturing. Putting all your manufacturing in one place can prevent you from growing quickly, greatly reduce your leverage, and put your business at a standstill.

If you are having trouble finding the right manufacturer, or would just like some support in this area, please send me an email at kris@kndrsn.com. I have a huge network of connections and would love to point you in the right direction.