Largest collection of Apparel Merchandising, Fashion Merchandising Notes, Tutorials, Tips, Experiences, Resources, Books, Jobs and Others


Factors have to consider before setting up garment business in small scale

Many visitors and some of my friends frequently ask me to know the way of establishing a garment industry in small scale. Most of them urge me to know the secret process as they have a vast curiosity to enter this ground. Last year I wrote such type of article for you to give you an idea regarding this sector. But now I am going to write another article to make your clear. You can read another article that was written by me to get more idea: Some innovative start-up business ideas concern with garments industry.

You should consider some parameters before going to jump in this arena. There are two ways to launch such business. First, one is to search customers and prepare product according to their requirements to sell. Second, one is to make lucrative samples at your end and then offer buyers to procure those products from your factory. The process is not so easy that you assume. Both processes are complicated, and you should do hard work to gain success.

It would be better if you gather some practical knowledge before taking such project. Here, I will give you a guideline to make your project meaningful. The tips what I am going to narrate is not only necessary for garment industry but also important to set up others industry. Cause production based business launching process is almost similar to each other. Read it attentively and give your level best effort to fruitful your dream.
Computation and Competitor analysis
garment businessThere are two types of start-ups business plan. I am going to narrate it below.
1) Innovation (It would be better to bring a new product to the market that never exists before)
2) Imitation (Copy a product that already exists in market)
It’s quite wise to bring a new product to the market. Use your brain to make a trendy, innovative product, but it’s very tough to identify something different and also risky to bring it to market. Because you invest a huge amount of money for new products, but you do not know consumers test. They may like it or not. Hence, you may observe some products come suddenly and vanish quickly from the market. So when you understand new products are risky for you then follow others business trend. You can learn much from your competitor’s technique. Just watch what he is doing and find his mistake. If you can trace, it would give you a suitable position in the market. Somehow you have to occupy current market by changing marketing policy or packaging layout or reducing costing. Remember situation and solution are different from each other. You may become a successful business man when you can recognize your problem independently and solve it perfectly.
Market Research
Now you have to do a research and find a fault in market chain. If you luckily found it, then you can lead the market either you might be snapped down. Secondly, you should find a loyal customer and redesign your products by adding value. Your knowledge scale needs to be increased by reading different types of books or online searching. After that, mistakes might happen, but you have to learn from it and March forward. Remember there is no shortcut way to success. Pay much attention and labor to get ultimate success.
Product selection
Several types of products are producing in the garment industry. It is very important that which category of items you are going to make? Your project success mostly depends on the selection of your product category. There are three categories of product like knit, woven and sweater mainly producing in garments industry. Beside this, there is a wide range of product categories among each item of garments like top/bottom, man/woman, youth/toddler/infant etc. You should involve which one is easier for you. If you are determined to make knit garment like Polo shirt, T-shirt or Trouser etc. then you should have some basic knowledge of knit business, you would not try to make woven items like Shirt, Jacket, and Jeans Pant at the same time. Sweater item manufacturing process and machines are completely different. You should emphasize on few category, never involve with several categories. Select your product range first then focus on next. Otherwise, you can’t move forward making your business plan.
Targeted Customer
When you are going to design your product that time you should consider consumers demand. You need to evaluate customers demand through different angle. By this way, you can know require production unit per day. Which market your targeted customers are going to purchase? What type of packaging would they like? And finally, how much they like to pay for your products? When you know all of these, then you can fix product costing and selling price.
Production target
Now determined how many units of items you are going to make per day? Your profit margin and operating cost mostly depend on your daily production capacity. Low production target will increase your operating cost and decrease profit margin. So, there should balance between production target and operating cost. Fix your production target i.e. 500 pieces of shirts or 1000 pieces of shirts will be produced per day? It is one of the toughest tasks at the initial stage for a newbie, but you have to fix it somehow to move to the second point. Later you can increase or decrease your production capabilities whatever your budget or clients requirement. Some of my friends who wish to set up new factory frequently ask me which type of machine and how many devices they will procure for their upcoming project. I politely pay attention to their talk and try to understand their product category and daily production target before delivering fruitful tips.
Nature of Machine
Now you have to choose essential tools and other equipment’s for those garments what you have already selected for production from the vast range of product categories. It is a vital portion for someone to purchase right machine for the right product. Imbalance machine line up may minimize your productivity. You have to fix standard amount from your capital for machine procurement. In this point sometimes you might need expert’s advice. Please discuss with them and make a list of all necessary sewing machines and other equipment. Please procure best quality machine to get optimum level productivity and hassle free service. To get more idea regarding sewing machine you can read another article: Sewing Machinery used for mass Production in Garment industry.
Machine quantity
If you can select product group, production target etc. then it is easy to estimate sewing machines and other equipment for procurement. It can be measured alternative way. Suppose, you already know product category and machine quantity then you can fix required production quantity per day. Excess or useless machines will make your money idle.
Raw Materials
As you already got a determination that which items you are going to make. So, you should have a vast knowledge of raw materials that are required for making those items. It would be better if you can make a list of required raw materials, their unit price, factory address and contact person etc. Please collect some swatch of those materials. By this step, you can able to know required budget for material sourcing.
Factory Space
A layout can give you a prior idea how much space are required for your proposed factory. Please make a layout for setting up necessary machines and other equipment. Beside this, you have to consider office space for office staff. By this step, you can assume required space for setting up a new factory. You should book a space as rental basis or make a factory building if you have a suitable land according to your layout. It would help you to prepare your budget for factory space.
Manpower Assessment
As you already ahead much for setting up a new factory, so estimate required manpower to launch it smoothly. Make a list of needed manpower according to process. You should consider a number of staffs for office, technicians, quality inspectors, storekeepers, supervisors and workers (operators and helpers) to full swing your project. It will give you an idea how much salary you have to pay per month for your employees. Expert’s advice is required to fix employees salary. Please do research running job market to procure skilled employee and approximate salaries for each employee.
Supplier sorting
You can compete with others if you offer lower price to your customers than other competitors. When you have sufficient information of several suppliers, then you can procure raw materials with minimal cost to deliver good quality products at cheap rate. So you should search useful and reliable suppliers for all materials and list their name to make your products. You have to consider quality and cost efficient materials; supplier’s lead-time, vendor feedback, nearest region, transportation cost etc. during listing.
Project Costing
Feasibility study, payback period (PBP), net present value (NPV), Breakeven point, cash flow management, capital management can be used to taking such project. If you have finance background, then it is easy to you to prepare estimate project cost, or you can take an expert advice regarding this issue. Some of you frequently asked me to know the approximate amount of money for setting up a tiny garment industry. Many of us capable of setting up a factory quickly but it is more important to run it perfectly. To evaluate total project cost, you need to compute space rent or factory building making cost, operating cost, wages for worker’s, salary of staffs, EMI amount (if you are thinking to take a loan from the bank or other sources). Please keep sufficient money for material procurement and other overhead expenses.
Project Layout
A skilled employee is an asset to your company. Make a detailed layout for your project. You have to reevaluate all the process one by one to minimize cost. It will help you to decorate necessary section to allocate manpower and other resources that will expedite all other functions.
Govt. Papers
You should collect some other govt. papers once your business runs in full swing. Govt. papers like trade license, tax identification number (TIN), labor & environment-friendly license, export-import license has to collect from concern department to expand your business.
Brand Building
Coca-Cola, Toyota, Apple and other rich brands could not gain this position by one day. Brand building never comes suddenly; it would be captured step by step by increasing customers faith. First, you can make attraction to your targeted customers by giving advertisement or another way. Your products must contain something special that is different from others. If your product or service satisfy consumers, that will insist them to procure it again and again. Don’t give over promise regarding product quality. Final step is bonding creation. It’s a part of brand building to make attraction between consumers for your products permanently. My advice regarding this issue: move slowly but surely.
Customer Hunting
Obstacles are not in the way; they are the way toward your dreams. Reach for it. Now it is the toughest thing to make a list of your potential customers. Your all efforts might be in vain if you cannot collect reliable and durable buyer who will procure your commodities regularly that will run your business wheel smoothly. There is a proverb “connectivity is the Productivity.” You should analyze your products demand by applying several methods. So keep sound relation with your customers and consider their feedback on a priority basis. It would be better if you do garment job for three to five years to get gist knowledge before taking such decision. You can hire an expert to get a guideline for your project or knock me to get further assistance. I will be happy if you seek any favor from me.

An amazing destination sparks the imagination. I know some guy who hadn’t much capital to set up a tiny garment industry. But they had strong concentration, enthusiasm, and passion for this profession. They knew it won’t be easy but believe in mind once it will be achieved. Go the distance. Now they are the owner of several garment industry. So prepare yourself to make a roar in this arena.

You may like: Challenge in Production Planning and Control in Apparel Industry

Leave a Reply