Answers
May 28, 2019 - 12:25 PM
[posted on behalf of Laxmin]
Avoid Pakistan like as hell. The quality keeps changing. You will end up with cheap and very low quality Chinese fabrics, re-branded in Pakistan. Especially Cotton fabrics. Pakistan's cotton output has stagnated due to poor farm practices.
The yield per hectare has not crossed 700 kgs for the past few decades. In comparison, the yield of Turkey, Australia and China are in the above 1000 to 2000 kgs per hectare. It is no longer one of the leading cotton producer countries.
The low output is already consumed by existing companies. New orders are fulfilled by importing low quality cotton discarded by other countries.
In the US, Pakistani textiles don't enjoy duty-free treatment under GSP.
Look to India, Bangladesh, Turkey, etc.
The other issue with Pakistan is they employ bait and switch tactics. The samples are really good but then the actual bulk shipments differ.
You will have to navigate too many excuses and promises that it is not worth it. Returns and refunds will start pilling up and mess up any good name or brand that was painstakingly built up.
Look into places like Tirupur in South India if you need passable but dependable quality at prices you can build a decent margin on.
May 30, 2019 - 09:08 AM
First, here are the pros and cons of sourcing from Bangladesh, Pakistan, and other alternatives to China.
BangladeshWhile Bangladesh offers low prices due to paying low wages to workers, the very same thing that makes it appealing can also be a drawback. Lots of bad press has been devoted to the poorly-paid workers there in recent years.
There was also the major fire at a garment factory that killed hundreds of workers. This could have been avoided if the building adhered to proper standards and workers were not packed like sardines!
Image credit: NPR.org
Brands that source from Bangladesh run the risk of being labeled exploitative, which may not be worth the low cost of manufacturing when you consider the risk of losing customers. That said, Bangladesh remains less expensive than China for sourcing clothes, so many retailers do still turn there.
Pakistan
Pakistan is a more promising option in terms of having low prices, without so much bad press about the treatment of workers. However, some large companies did pull their sourcing out of Pakistan several years ago due to issues with working conditions, such as Walt Disney.
Brands must balance the need for low prices with the need to avoid the kind of scandal attached to human rights violations in factories. Political instability poses another potential issue in Pakistan that can slow down shipping times--the recent terrorist attack is an example:
Image credit: bbc.co.uk (Pakistan president Imran Khan with mourners after terror attack)
Philippines
Retailers who source from the Philippines benefit from the fact that English is one of the country’s official languages. Communication barriers tend to pose less of an issue there.
However, the island nation’s geography poses something of a setback. Transportation between the islands is often limited, and commercial ships face the threat of piracy in the water. This can create expensive delays for brands.
Vietnam
Counterfeit goods have plagued countries like China and Vietnam for many years now. However, certain ecommerce brands will be glad to know that the Vietnamese authorities take counterfeiting seriously, and have cracked down on the practice in recent years.
This country is also mostly free from the environmental disasters that plague other manufacturing countries in Southeast Asia, such as volcanoes and monsoons.
And because Vietnam is near China, moving your sourcing operations there might be an easier transition than moving them farther away. Finally, worker protests and strikes there are fairly rare, though not unheard of.
India
India boasts a workforce near the size of China’s, which holds some appeal. However, the productivity of workers in India appears to be lower than that of workers in China, which can slow things down for brands.
The issue could be a labor shortage: not of overall labor, but of the skilled labor needed to keep things running smoothly. Navigating India’s government can also be tricky, since policies are different depending on which part of the country you’re in.
Mexico
Mexico offers the benefit of being very close to the U.S. This means fast delivery, while still paying relatively low wages for workers. In fact, wages for garment workers in Mexico are lower than those for workers in China, and growing slowly compared to many other countries.
Mexico also doesn’t face much in the way of political unrest, natural disasters, and other issues that can disrupt the sourcing process. Navigating regulations in Mexico is easy for U.S. brands, too.
Making the Best Choice
These countries are popular alternatives to China, but you’ll have to weigh the pros and cons to decide which one might work best for your brand. Let’s take a closer look at how tariffs and other factors should play a role in your decision.
Tariffs
Tariffs can vary wildly depending on the product, but they are high for clothing across the board. While the recently increased China tariffs have gotten a lot of press, clothing tariffs also remain high for competitor countries like Bangladesh and Vietnam.
As sourcing from those countries becomes more popular, tariffs might get raised on goods from there, too. And while some countries enjoy tariff exemptions for products like steel, those same exemptions don’t exist for clothing.
Generally speaking, the more popular a country is for sourcing, the higher tariffs you can expect. To avoid tariffs, of course, you can source from the U.S., but the high cost of doing so usually isn’t worth it.
In the end, you have to weigh the other pros and cons of the sourcing country while trying to reduce what you pay in tariffs. A higher tariff might be worth paying for a country with higher productivity, for example.
Workers’ Rights
Although it’s been mentioned above, the value of considering workers’ rights when making your choice can’t be overstated.
You’ll want to screen manufacturers to avoid bad press, protests, and boycotts. However, this can be tricky to navigate, since developing countries that are cost-effective to source from also tend to have fewer worker protections in place.
The International Trade Union Confederation’s Global Rights Index can give you a big-picture look at which countries are doing right by workers. However, each manufacturer will be different in how they treat workers, even within the same country.
Also, developed countries don’t always have the best score on the Global Rights Index: the U.S. scores surprisingly low, for example.
Being transparent about where you source from and why can become a selling point for customers. For an ecommerce company, openly stating that your clothes are produced under ethical conditions (and backing up that claim with action) means your products can command higher prices. This can also help set you apart from the competition.
Environmental Impact
Shoppers today care about environmental impact, so that’s also worth considering when choosing where to source from. For example, your buyers might be willing to pay a little more if they know they’re minimizing environmental harm by doing so.
Reports of environmental damage from a factory, just like workers’ rights violations, can result in bad press and lost customers. Some countries offer more environmental protections than others, but again, it will also depend on which specific manufacturer you choose.
Quality and Experience
Of course, factors like shipping times and prices will influence your decision. But there’s also the more nebulous factors, like the quality of products and how experienced the manufacturer is.
This will change between manufacturers, as well as between countries. Countries that are just starting to show up on the manufacturing map won’t offer as much experience overall, but within those countries it’s still possible to find good manufacturers. You’ll also find a wide variation of fabric and tailoring quality between manufacturers within a single country.
Make sure to verify that the manufacturer you choose follows U.S. textile regulations to avoid unsafe substances in clothing. They should be able to prove that they’ve been compliant with those regulations in the past and will continue to do so in the future.
Always get samples from a supplier before you commit to working with them, to verify that the products meet the right quality standards and follow the proper regulations. While you’ll still need to do periodic quality control, sampling from a few manufacturers before you choose one will reduce issues later on.
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