If you are a new brand in the clothing business looking to work with manufacturers, your focus may remain on MOQs but there are many other important questions that you must ask a clothing manufacturer to evaluate whether they are a good fit for you or not.
You may be unsure of these strategic questions you should ask before signing a deal. Questions like what is your capacity, what value-added services can you provide, etc. Moreover, if you are already running a fashion and looking to grow, these important questions will help you determine whether the potential clothing supplier is a good fit for your business or not.
You need your own designs irrespective of whether you are an entrepreneur looking to start your own clothing company with personalised products or an existing brand looking to scale up. Furthermore, you’ll almost certainly need to have some form of product development and sampling for your products. So asking these questions to your potential supplier will help you weed out the bad ones.
Here is a list of 10 most important questions that you must ask before making the final call on working with a clothing manufacturer.
10 Questions to Ask a Clothing Supplier
#1 What’s Your MOQ?
If you are looking for a clothing supplier who can work on small MOQs (Minimum Order Quantities) then this should be an obvious and the most burning question. See whether they can clearly make a distinction between a MOQ (Minimum Order Quantity) and MCQ (Minimum Colour Quantity per style)
Ask a deeper level question like – what is the logic behind MOQs?
See whether the manufacturer arrives to the calculation of Minimum Order Quantities in a logically, coherent manner or is it just take it or leave. Now, you may think – what difference does it make, whether a clothing supplier is able to explain you the logic behind MOQ calculation, right?
If your clothing manufacturer is able to explain you the logic behind the MOQ calculation, specific to your brand and products – that is the supplier that you should dig deep and engage further. There are going to be three types of clothing suppliers you should be able to eliminate using this deeper level question.
#2. What is the cost breakdown?
Every clothing manufacturer would require a specific quantity for order in order to take care of their fixed costs. This is what is defined as the Minimum Order quantity or the MOQ.
At Hula Global, our MCQ could be 100 pieces per style but our MOQ could be 5,000 pcs per PO for our private label program. Under this private label program, we have a structured sampling and product development process which our customer success team communicates to our customers on a case-by-case basis. But we provide a detailed break down of how we arrived at MOQ but also the breakdown of the products under evaluation.
Additionally, there are separate charges for sampling and product development depending upon what stage of product development you are currently. You can learn more about the development charges under private label program here.
Essentially, your clothing supplier should be able to provide you a breakdown of cost that actually makes sense to you. If not, you should filter them out.
#3 What Are Your Unique Selling Points?
A clear USP helps recognise the differences, even if they are non-existent. And may also help consumers establish a positive attitude toward a brand, which may eventually contribute to greater levels of brand recall. For Hula Global, it has two clear USP’s
a. Time commitment : we understand that we are in a time constraint industry where on-time delivery is extremely important. And that’s why one of biggest USP is on or before time delivery
b. Transparency : We provide breakdown and details of all the relevant pricing that makes sense to the brand owners that we work with. Having clear transparency helps build mutual trust and respect.
c. Quality Control : A large portion of the brands we work with, have e-commerce as distribution method. Product returns due to defect is a major challenge that most fashion brands face before they start working with us. Once they start working with us, we ensure that the goods that we ship are inspected 100% and free from any product defect.
We always keep in mind the alignment of interest with the brand founder ahead of everything and you should ensure that your potential supplier is thinking in a similar manner.
#4. What Value-added Services Can You Provide?
Value-added services is one of a few crucial factors to consider when hiring a manufacturer for your clothing brand and yet this factor almost and always gets overlooked.. It can maximise your profitability. Ideally, you should look for a full-stack clothing manufacturer who can take your ideas, develop an entire collection with design inputs from you & your team, develop samples, produce and ship to you. This means your clothing supplier should have in-house designers, product developers, merchandisers, quality control managers, production planning managers, admin, logistics & shipping managers.
It is fairly a common operating process for large well-known suppliers to have in-house teams for fabric sourcing, trims & packaging, and sample development. Hula Global is a full package apparel supplier that takes care of everything – from product development to complete production, including shipping!
#5. What Are Your Terms of Payment?
When discussing the cost, don’t forget to ask about the payment conditions. So inquire with the manufacturer about when they expect the payment to be made. Most manufacturers want an initial advance to begin work, with the remainder due at the time of delivery.
While signing a contract with our customers, we, at Hula Global, take half of the Purchase order value in advance, and the remaining half of the payment before dispatch. We also work on Letter of Credit / Bank Guarantee and against BL / TT at Sight payment terms.
#6. What Are Your Capabilities?
Knowing the capability of any manufacturing firm is crucial. This is what helps you to decide which manufacturer to choose for your specific product. It is quite possible that you may work with more than one manufacturer depending on the type of product you need.
For example, if your collection has a total of 20 styles, out of which 10 styles are in knits, 5 are in woven and the remaining 5 styles are in denim – it is very likely you could be working with either 3 separate manufacturers for knits, woven and denim or if it is a single large manufacturer like Hula Global – three separate teams would be working on your collection.
#7. Do You Supply Materials?
Another important question you can ask a manufacturer is if they provide the raw materials for the order. In other words, if they do the sourcing part too while implementing ideas and designs into apparel. At Hula Global, we do everything from fabric sourcing to manufacturing, finishing, packing, trims to specified washing(as per the requirement) services for our customers.
#8. Quality Control
Ask your garment manufacturer not only about Quality control process but the cost of quality control. If you manufacturer is not charging you anything for quality control, they are not going to borrow money from the bank, hire quality control professionals using their money for your brand. A simple rule of thumb, if you are not paying for quality control cost, there is no quality control happening.
Most first time founders think that if they ask their potential supplier the cost of quality control, eventually the supplier might realise that they forgot to add the cost and increase price.
Even if you don’t need certification for your product line, make sure that your supplier has some basic industry certification. Ideally your supplier should able to proudly list out all the certifications on their website because most likely they have spent a fortune getting those certifications. Some of these industry certifications are Sedex, GOTS, SA-8000, GRS, WRAP etc. You can visit our certification to learn more about our certifications and there a detailed FAQ page on certifications in our knowledge base.
As you scale and grow your brand, you will understand the challenges of managing the working capital cycle. You cannot and should not buy goods by paying advance each time you put in a purchase order. In fact, in apparel and textile industry – certain level of credit period is more common than you may think of.
Industry standards are Net30 / Net 45 / Net 60. We have even done Net 90 – which means, the brand that was extended the credit, did not put any advance and paid full after 90 days. By using this method of working capital management, you – as a brand, do not need to upfront any cost and get 90 days to sell all your goods and use the proceeds to pay back your supplier.
Of course this is a lot more complicated than it sounds and most likely you will have to be eligible for financing. But what happens when you are eligible for financing but your supplier lacks the ability to finance your working capital needs.
A word of advice – working capital finance is like a loan, so there is a cost to financing that you need to be care. This post is not a proposal or solicitation for financing but simply a knowledge base to share the importance of find a supplier who can finance, keeping me in mind your brand’s future growth.
We hope that now you are well aware of what questions you should ask a clothing manufacturer . While every situation and brand is unique and you would have many more questions beyond these questions but we hope that at least these questions would provide you with some framework to kick start a productive discussion with your prospective supplier.