Surviving in the fashion industry demands more than just trendy designs. Keeping up with ever-evolving trends, meeting customer expectations, and making strategic decisions are important to building a sustainable brand. While launching a successful clothing brand is undoubtedly a remarkable achievement, the real challenge lies in maintaining its competitiveness and lifespan.
One of the hardest choices a fashion entrepreneur faces is the production model: in-house production or outsourced clothing manufacturer. This decision is related to selecting the perfect fabric for your designs – a significant decision that can make or break your brand.
However, statistics reveal that the majority of US brands, approximately 97%, opt for outsourced production. While this trend offers valuable insights, it’s essential to dig deeper and understand the specific advantages and disadvantages of both production methods.
To help you make a sound decision, we’ll break down the key differences between in-house and outsourced clothing manufacturing. By the end of this blog, you’ll have a clearer picture of which approach goes best with your brand’s goals and objectives.
| Elements | In-House Production | Outsourced Production |
| Cost | High initial investment in equipment and staff. | Lower labor costs and reduced overhead expenses. |
| Quality Control | Direct and complete control over quality. | Quality control depends on third-party manufacturers but can be managed with proper oversight. |
| Scalability | Limited by in-house resources and capacity. | Easily scalable to meet demand fluctuations. |
| Expertise and Technology | Requires investment in specialized skills and technology. | Access to the latest technologies and specialized expertise. |
| Speed to Market | Potentially slower due to in-house limitations. | Faster production cycles with established manufacturers. |
| Core Competencies | Diverts focus on managing production operations. | Allows focus on design, marketing, and brand growth. |
| Flexibility | Less flexible, harder to adapt to rapid changes. | More flexible, can quickly adapt to changes in demand or trends. |
| Risk Management | Greater control but higher risk with internal issues. | The shared risk with third-party manufacturers. |
| Initial Setup Time | Longer due to setting up production facilities and hiring staff. | Shorter, as manufacturing infrastructure is already in place. |
| Communication | Easier with direct oversight and internal teams. | Potential communication barriers with overseas manufacturers, but can be moderated with effective management. |
What is Outsourced Production?
Before we understand the difference it’s important to know each model individually. So, outsourced production is when a clothing line collaborates with a custom clothing manufacturer to handle the production process. Instead of doing everything in-house, you offload the manufacturing parts to the field experts. So, you can primarily focus on design, marketing, and other different areas of your business.
Reference: chiang mai clothing
There are three main types of outsourcing for clothing manufacturers:
Contract Manufacturing
This type lets you design the clothes, but a private-label clothing manufacturer creates them based on your provided specifications. For example, you are a designer who is starting a new line of jeans, but outsourcing the cutting, sewing, screen printing, and washing processes to a manufacturer Argus Apparel.
Original Equipment Manufacturing (OEM)
Similar to contract manufacturing, this type lets manufacturers get a higher level of control over the production process. For example, you can provide complete technical specifications and quality standards for a manufacturer to follow when producing a specific product, like a particular sportswear.
Original Design Manufacturing (ODM)
The clothing manufacturer designs the product based on your input and then produces it. This is often used for brands starting out or looking for budget-friendly solutions. Like, a brand might provide a general idea for a dress, and the manufacturer develops the design, patterns, and samples.
What is In-house Production?
In-house production includes the complete manufacturing process of fabric within a company’s own facilities. This covers all stages, from the initial design concept to the finished product. It offers greater control over the production process and allows for custom clothing manufacturing aligned with particular brand requirements.
Reference: Guideline for Garments Manufacturing Process
Difference Between In-house and Outsourced Production?
In-house or outsource? It’s a big decision. Both options have their benefits and drawbacks. Let’s check out the key differences and see why outsourcing often comes out on top.
Cost Comparison
In-house production can be a real financial drain. You will be stuck with overhead costs like rent, equipment, and utilities. Moreover, you also have to pay salaries and benefits. On the other hand, outsourcing can be a lifesaver. You only pay for what you need, and you can often find manufacturers in places with lower labor costs and prime quality.
Quality Control
No doubt, in-house production provides you with more control over the product, but let’s be real. Maintaining consistent quality can be challenging. For that, you will need a skilled workforce, advanced equipment, and a strict quality inspection department. However, partnering with experienced clothing manufacturers often leads to better quality control because they have the systems and expertise to deliver consistent results.
Delivery Time
Need to launch your new clothing line tomorrow? In-house production might seem faster, but don’t be fooled. Delays happen, and you have to depend on your own production schedule. However, outsourcing can actually be quicker. Many clothing manufacturers have streamlined processes and can turn around orders faster than you expect.
Scalability
Taking your clothing business to the next level is exciting, but it can be a headache if you’re manufacturing your fabrics in-house. You need more space, equipment, and workers. Outsourcing gives you the flexibility to scale up or down as needed. No more worrying about capacity issues.
Case Study: Big Brands That Are Using Outsourced Production
Want proof that working with a third party clothing manufacturer is better? Let’s look at some major clothing brands getting a success with outsourced production:
- Zara is one of the well-known fast-fashion giants that has mastered the art of outsourcing. They partner with different manufacturers worldwide, especially in Asia, to mass-produce trendy clothes at lightning speed.
- H&M, another fast-fashion champion, relies heavily on outsourcing to keep prices low and styles fresh. By working with a multiple network of suppliers, H&M can offer a vast variety of fashionable items at affordable prices.
- Nike, while known for its iconic designs and athletic apparel, outsources much of its manufacturing to focus on innovation and marketing. By using the expertise of worldwide manufacturers, Nike can maintain high-quality standards while dedicating more resources to research and development.
- Gap, a casual wear brand, has been outsourcing production for years, allowing them to concentrate on design and retail. By outsourcing, they are producing large volumes of clothing at lesser costs, which helps them remain competitive in the market.
These brands prove that outsourcing can be a powerful tool for growth and profitability. By partnering with experts manufacturers, they can focus on what they do best: designing, marketing, and building their brand.
Want to follow in their footsteps? Let’s read
Factors to Consider When Choosing a Clothing Manufacturing Method
Picking the right manufacturing model is a big deal. It can impact the success or failure of your brand. There’s a lot to think about, from costs to quality and everything in between. Let’s break it down.
● Cost Analysis
Money makes the world go round, especially in the fashion world. In-house production often comes with high upfront costs for machinery, labor, and facility rental. Conversely, outsourcing can spread out these costs but might have hidden fees. So, run the numbers, perform in depth comparisons, and see what fits your budget.
● Quality Assurance
Your brand’s reputation depends on the quality of your clothes. In-house gives you more control over the process, but it requires strict quality standards. Outsourcing means relying on the manufacturer’s quality checks. Either way, implement strong inspection processes to guarantee your customers get the best.
● Communication and Control
In-house production gives you full control, but it also means managing everything yourself. Outsourcing means relying on clear communication and trust. Regular check-ins, detailed specifications, and a strong partnership are key to maintaining quality and meeting deadlines.
● Long-term Strategy
Think big picture. If you plan to scale speedily, outsourcing might be best way to go. But if you want to build a strong in-house team and safe your intellectual property, in-house production could be the answer. Align your manufacturing choice with your overall business goals.
● Supply Chain Reliability
Whether you produce in-house or outsource, a consistent supply chain is needed. Delays, quality issues, or ethical concerns can destroy your business. Build strong relationships with suppliers, modify your supply chain, and have a backup plan in place.
● Ethical Considerations
Customers care about where their clothes come from. Make sure your chosen cut and sew manufacturers‘ creating method aligns with your brand values. Fair labor practices, sustainable materials, and ethical sourcing are becoming increasingly important if you are opting for in-house clothing production.
Which One is Beneficial for Your Clothing Brands?
Well, if you are still hesitating in choosing the one, let us clarify your idea. The best choice for a clothing brand is a strategic decision that demands careful consideration. While in-house manufacturing offers greater control over the production process, it often necessitates large capital investment, talented manpower, and operational expertise. Outsourcing, on the other hand, can provide cost-efficiency, scalability, and access to known manufacturers.
But, the overall approach depends on a brand’s specific goals, resources, and market position. By carefully evaluating factors such as production volume, product complexity, desired level of control, and long-term business objectives, fashion brands can make best decisions that align with their overall growth strategy.
