As a production manager, the things clients ask most are: what is the difference between offshore and local production? And why is offshore so much cheaper? Well, there are particular factors that directly reflect the price of your development.
Cutting to the chase here, offshore productions require high minimum quantities per order. China, in particular, is about 2000 units per style. Yes, you can split that into different colors and quantities, but a massive production with this many quantities requires planning, an organized budget, extra time for sourcing and marketing, a lot of marketing (lol, but for real) because you do not want to be sitting with a bunch of inventory and not make any profits. Not all countries and all offshore manufacturers are like that though… It is possible to find offshore manufacturers with lower minimums. I have seen China factories that can produce about 500 units per style, but obviously, the timing and investment will not be that much different.
Another important point on offshore productions is quality control. Yes, you can absolutely find great quality in a lot of different countries, but again, all these countries will be requesting a larger minimum per order. The biggest difference when it comes to quality control is the fact that producing anything locally you have the chance of visiting the factories, see who you are dealing with, ask for samples before jumping on a full production (especially if we are talking 2000 units, LOL) ask for a top of production and, obviously, check quality.
For those not familiar with product development and how it works, shame on you! I already wrote a post about this, so go back and read it - LOL, but for real! Anyways… right before production, you need to make sure your samples and tech packs are 100% correct and good to go because that is exactly what the factories will look at. Especially offshore. In a local production, you might not have a perfect sample or a full detailed tech pack, but you know your grading and production markers are correct, you can ask your local factory to cut the production, sew up one garment in each color and see how the top of production will come out. Any mistakes can be solved at this stage before sewing up the entire production. Meanwhile, in offshore production, you provide a perfect sample in each colorway, a perfect detailed tech pack, and pray to God that nothing will be messed up (lol, but for real). The chances of something coming out messed up are usually small and will happen only if you are not prepared, but again, for everything to go smooth, this requires at least a year of organization.
Another thing considered a “downside” about offshore production is the fact that offshore manufactures will source their fabrics. You can provide them with swatches of your materials, but manufacturers will source and use their own. Even for custom fabrics, all factories will provide you with their own suppliers. When local factories you can supply your materials - you get to pick trims/fabrics yourself and go buy them yourself. This is another thing that is not an issue neither is it something to worry about it, but again BE PREPARED, have swatches and samples of absolutely EVERY SINGLE material/fabric/trim being used on your collection, and make sure you will be approved what offshore manufacturers sourced for you.
One of the last, and most asked, regarding offshore production is the price point. As I mentioned, offshore production requires high minimums. And this is simple math: high production quantities = lower cut and sew prices. Low production quantities = high cut and sew prices. If you think about it, factories are paying the cutter and the sewers per hour. Charging $8 per dress to produce 60 dresses is $480 which the factory will use to pay the cutter (between 2 to 3 hours) and the sewers (counting that on a production line, one sewer is putting the dress together, another one is pressing the hem, another is sewing the hem and another is cleaning threads and pressing all garments, so another 2 hours). Plus the factory owner needs to make a profit. But if you would like to order 2000 units at $8 per unit, well, do the math then…
In general offshore production is great and turns out really well, but there are different factors that you need to consider and ask yourself before jumping into a large investment and commitment like this. Yes, producing offshore is cheaper and directly affects your selling prices. That is why you see H&M and Forever 21 producing tons and tons of styles while selling dresses at $25 retail price. But everything is related to the kind of budget are you willing to put up with, who are your customers, and what kind of quality you are looking for.
Valuing local products, local brands, manufacturers and vendors have a huge impact on the market and, for those who do not realize it, there is more than prices, numbers, and investment happening behind the scenes. Me, in particular, I do not like or dislike offshore or local manufactures, but I do like to think ahead, budget out, organizes a marketing plan, and see what fits best for each client. The bottom line is always to make the sales and, in this case: how to be profitable from your production!
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