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Overseas Garment Production Pros & Cons

Overseas Garment Production Pros & Cons

Overseas Garment Production: The Real Story

Whether you’re a new or established designer, it’s essential to consider the pros and cons of overseas garment production. Like any industry, there are both positive and negative aspects to producing your products overseas.

Public Perception

Over time, the public perception of foreign-made goods has declined, while the perception of locally-made goods has increased. The “Local First” movement gained popularity, promoting buying locally-made products. However, as someone running an overseas garment factory in Indonesia, I still believe in supporting local production for the same reasons.

Many consumers have a love/hate relationship with items made in other countries. They appreciate the lower prices but may distrust the quality and working conditions. Concerns about ethics and sustainability have become more prevalent, but we also need to confront biases influenced by media portrayals of “sweatshops” and factory conditions abroad.

The Reality

The reality of overseas garment production often differs from the stereotypes. In many cases, overseas facilities can offer excellent working conditions and ethical practices. However, buyers should still be vigilant and do their homework to ensure they are partnering with responsible manufacturers.

Ethics of Overseas Garment Production

Ethical options for overseas garment production are just as prevalent as in your home country. Providing well-paid employment and fair working conditions to people in foreign countries is just as noble as doing so locally. Ethical considerations should be a priority, regardless of the location of production.

Shop Local vs. Offshore Production

Supporting local businesses and buying local products has many benefits, including job opportunities and environmental conservation. However, in some cases, producing locally may be cost-prohibitive due to high labor costs or limited access to raw materials. Offshore production may be more practical for certain items, especially when the materials and labor are readily available in the foreign country.

Clothing Manufacturing Considerations

When it comes to clothing, the equation takes on a more intricate complexion. The basic components of clothing – the raw materials and the machinery to transform them into fabric – can be found scattered across the globe. This prompts a logical query: why opt for overseas manufacturing for clothing? Why not keep production local? The answer to this quandary is a straightforward one: the cost of labor.

In countries like the US, Australia, and Europe, the cost of labor stands at a lofty height that’s often unsustainable for most fashion brands. It’s important to grasp that the crafting of clothing predominantly involves manual labor, not automated machinery (and honestly, would you really want it any other way?). So, when you’re investing in clothing, you’re not just paying for the materials – you’re compensating the skilled hands that meticulously bring your designs to life. In the US, this skilled workforce might demand wages of around $12 to $18 per hour. And yes, even on those wages, many individuals find it an uphill struggle to make ends meet.

Now, consider the alternative. In a place like Indonesia, a similarly skilled worker can lead a comfortable life on wages as low as $3 per hour. And remarkably, that’s an above-average income in that context.

Let’s break it down with a rudimentary example:

Imagine a clothing item requiring 1 hour of cutting and sewing, along with $5 in raw materials. In the US, where labor costs are higher, this item’s hard cost would clock in at $20 with a $15 wage. On the flip side, in Indonesia, the same item would cost around $8 to produce. But the story doesn’t end there. When we account for the typical retail markup of 4-6 times the hard cost of the item, we get the final retail price:

For the “Made in the USA” item: $80 to $120

For the Indonesian item: $32 to $48

The conclusion? Overseas garment production enjoys a substantial cost advantage. However, if you’re concerned about nurturing your local economy, it’s essential to mull over not just the production costs, but also the earning power and spending capacity of the average individuals within your community. Balancing these intricate factors can lead to well-informed decisions that resonate positively on both a global and local scale.

Finding the Balance

As a fashion label, you can focus on ethical overseas garment production by prioritizing quality, avoiding the lowest price option, caring for the workers, and being conscientious at every step of the production process.