With fast fashion demands growing and China's costs rising, sourcing closer to home is a more commonly considered option for apparel brands and retailers.

  • Sourcing locally can mean faster turnaround times, better relationships with suppliers and greater control over quality
  • Face-to-face communication with a local factory can help solve problems and address issues more quickly
  • Brands can visit a local factory and be aware of its working conditions
  • And local companies can often produce smaller minimum order quantities than overseas manufacturers
  • A shorter timeline to market can also be a tremendous help to a brand's cash flow 
  • But location must be considered carefully as sourcing locally can mean more hands-on management and cost 
Local suppliers may have limited growth compared with those offshore

Local suppliers may have limited growth compared with those offshore

Companies sourcing locally can have faster turnaround times, potentially better relationships with suppliers, and greater control over quality. However, they should consider their location carefully as sourcing locally can mean more hands-on management and cost. 

For instance, a European company sourcing in Turkey would probably need to plan for only two to five days of transport by truck compared to 20 to 35 days by sea from the Indian subcontinent, says Peter Lund, CEO of Indonesia-based apparel consultancy PT Pevali Group International.

"The same would be valid for US sourcing from south of the border [in Mexico or Central America, for instance] compared to Asia," he adds. The company has clients in Germany, the UK, Scandinavia, Australia, Vietnam, Singapore, Malaysia, Thailand and Indonesia.

Boaz David, owner and president of US-based consulting and production company Human B Designer Corp, notes that patterns and samples can be ready domestically in about two weeks compared to the typical three to four weeks, plus shipping time, from overseas. Human B creates and oversees production chains for small to mid-size brands, mostly based in the US, with the majority of the production it arranges handled domestically.

"Same goes for production; the average production time for cut and sew domestically can be about three to four weeks, while overseas it can be anywhere from eight or more weeks, plus the additional shipping time from overseas," he says.

David adds one key advantage with a shorter timeline to market can be "a tremendous help to a brand's cash flow." 

Face-to-face communication

Meanwhile, Adila Cokar, founder of Canada-based Source My Garment Consulting – a sourcing consultancy focusing on ethical garment manufacturing – adds that face-to-face communication with the people running a local factory can be advantageous. They can have more direct control with solving problems and quickly address issues as they arise, she says. Brands can also see the factory and be aware of its working conditions.

David agrees, noting that when companies can physically visit the factory producing the goods, they are better placed to eliminate any concerns they may have over its operations. This is particularly useful for smaller brands that may not be able to afford visiting an overseas factory. 

He adds: "For example, when we produce product for our customers here in New York, our team is at the factories on a daily basis which gives us a great control over the process. Yet when we produce overseas, the communication is not always done with someone who is on the floor and many times we don't get the right info or we get the info too late to make a decision."

Cokar adds that local companies can often produce smaller minimum order quantities when sourcing closer to home compared to those required by overseas manufacturers, although that is not always the case.

For companies looking to start sourcing locally, David recommends they visit a target factory and meet staff in person, examine their capabilities, and see the products they make.

"There is nothing like a physical face to face impression (for both sides) – that is a big advantage of producing locally, so they should definitely take advantage of that. It will be very helpful when deciding on a factory," he adds.

Time-consuming coordination

However, companies also need to consider that while sourcing closer to home can be faster, it may require more work. One key difference is that overseas sourcing contracts generally involve a brand working with a merchandiser and factory that handles the whole process.

"Domestically, you will have to run around to gather trims, materials, manage any fabric defect issues, hang tags, washing if need be and find a place to store fabric and manage deliveries," explains Cokar.

David adds: "These could all be separate places and the brand will then need to coordinate between all of them and oversee the process closely. This can get costly, time-consuming (especially if they are not all located near each other) and opens the door for mistakes…not to mention it could be very overwhelming for a small brand." 

He stresses that if a product has a few different elements, stiches or embellishment, a company should determine if the factory of choice can do it all in house or if it may need to outsource work to a third party. 

For more niche products such as fair trade or sustainable apparel, sourcing from manufacturers located closer to upstream inputs maybe more efficient, says Cokar.

For example, India has abundant supplies of organic cotton and equipment to manufacture custom fabrics, sometimes working to smaller orders, despite manufacturers' distance from western markets.

"I find working with India fits my clientele…they're more small-scale factories that can output higher quality," she says. Quality garments also require skilled workers, and in some remote outsourcing locations, factories can build on decades of experience.

Companies sourcing closer to home may also be limited in growth, says Cokar. "Eventually, you may need to produce offshore if you want to grow. Sometimes it's better to start offshore and have someone you know who you can grow with." 

Click on the following links to read other reports in this management briefing:

Sourcing shifts – Why China makers are moving out or moving online

Sourcing shifts – Multiple country choices require complex decisions

Sourcing shifts – Manufacturing hubs vying for business