Recently, we were invited to speak at TexWorld USA for their July trade show. They partner with Lenzing to organize seminars for attendees to gain industry insights on the latest in textiles, sustainability and trends. They’ve also begun a boot camp series aimed to help emerging designers and small brands with the basics. We were asked to focus on sourcing and manufacturing for this beginner crew.
It’s tough to decide where to focus a lecture when you don’t know your audience, and most likely, out of over 150 attendees they are probably all in different places and experiencing different challenges. This in mind, I tried to give a very general outline of sourcing and manufacturing in order to see what questions came up, and then we would (hopefully) build from there. I was prepared for the worst and bracing myself for really difficult questions about finding the right factories, logistical issues, importing and exporting, sourcing the right fabrics for specific projects, and etc. Ironically, the challenges coming up for most people had to do with them not having done the preliminary research necessary at the start of their fashion business development and before jumping into manufacturing. What do I mean by that?
In summary, all the questions I received fell into 2 main categories:
How do I take my product to market? Inventory first or pre-orders first?
Essentially, the answer to these questions are always the same.
Do your homework!
To understand how to price your product and receive the best cost price from your manufacturers, you MUST MUST MUST have a target cost before you ever ask a manufacturer to sample. If you don’t give them target costs to hit, it’s like asking someone to guess what’s best for you. I know it seems counter-intuitive, but you are not being savvy by asking a factory for their best price. This in fact, is not what negotiation looks like. The best you can do for your business is to have a transparent relationship with your manufacturer from the beginning. Ultimately they are a huge partner in the lifecycle of your product. Being upfront about your product cost targets and your expectations allows your manufacturing partner to be honest about what they can do. When you’ve set a clear cost target and clear expectations, then the negotiating can begin.
If you don’t know where to start when it comes to figuring out your target costs, you can learn more about why its important here, some advice on setting up a pricing strategy here and a step-by-step guide to calculating your target costs here. Clearly this is a subject we feel strongly about since we keep writing about it, so read and be better prepared. If you know your target costs, it shows your manufacturer that you’ve done your homework and understand your business, which helps to build their trust in you as a long time customer.
This seems to be the million dollar question (or as I like to say, the question I once paid a ‘Fashion consultant’ thousands of dollars to answer). We all just want to be told the best road to take to be a success in fashion. Though, if you look around at all the designer stories out there, you will soon find that there is no one road that leads everyone to Rome. Your product is unique, your target audience is unique, and today in the world of this thing called omni-channel, no two customers shop alike. The preparation for going to market is a subject all it’s own, and therefor will write a whole post dedicated to this subject and my general advice I give on the subject. So basically, stay tuned!