Bangladesh is the 2nd largest clothing manufacturer and apparel exporter in the world. The trend is growing mainly because of how cheap the wages are in Bangladesh. Another trend that got the big clothing brands moving away their main production facilities to Bangladesh is the commitment to quality. The Bangladesh government and the BGMEA (Bangladesh Garments Manufacturers & Exporters Association) have been investing heavily since 2007 to compete with quality and cost at the same time.
Here are 5 steps that will save you time and money by making sure you get the right product with the right quality:
1. Find Authentic Suppliers
This is probably the toughest part. Your options are limited to trade fairs, online directories or hiring a specialist agency that takes care of this part. Which ever you go for, it is important to verify the identity and the credentials of the clothing manufacturers.
2. Clearly Define Expectations
This includes quality and testing metrics, production lead time, worker & workplace ethics, shipment date, payment terms and as much detailed as you can possibly get. This will help you make your case if incase something goes wrong. These expectations should be well documented before transactions begin.
3. Making Sure Terms Are Being Followed
It’s not always possible to go and monitor the factories by yourself or your team. A trusted supplier wouldn’t normally need monitoring. However, if you’re working with a supplier for the first time, it’s best to set perimeters. One such way is to hire 3rd party inspectors such as Asia Inspection to make sure the agreed expectations are being met. More than just quality.
4. Negotiate Sensible Payment Terms
If you’re working on T/T (telegraphic transfer), basically wire transfers, the industry standard term are 30% to 50% payment has to be made on advance to cover material and accessories cost because these are bought from either international or local suppliers by the factory. Keep the advance payment % as low as possible to minimize your risk.
If you’re working on L/C (letter of credit), usually used for large orders, the bank will make sure that the supplier ships your products because the supplier would have to submit the bill of lading to the bank in order to withdraw their payment.
5. Formalize & Documentize Everything
Have a contract with your supplier before you get into business. This contract should clearly state all previous 4 points and additional clauses that your brand/organization may require such as liability, intellectual property rights to your designs, consequences if terms are not met etc.
After your clothes are ready, take a look at how to properly ship your clothes from Bangladesh to one of the 90 countries the country’s apparel industry exports to.
Final bit of advice is to have a working system in place before you start sourcing your supplier. The supplier will respect your knowledge and will think twice before acting and can lead to offering you a lower price. Good luck!