Whether you’re on your way to scaling your fashion startup or you’re just about to introduce your very first product to the market, sooner or later you’re going to have to make some decisions about how your clothing brand is going to be run. It’s crucial to understand when it’s best to do something in-house and when it’s better to go with outsourcing.
Studies show that businesses can cut as much as 70% of their labor costs by outsourcing. However, this may not always be the best option for every clothing brand. To make sure you’re making the right decision for your business, let’s take a look at when it’s best to handle things in-house and when it’s worth considering outsourcing.
What Is Outsourcing?
Investopedia defines outsourcing as “the business practice…” of having an individual or firm perform a task or service that is typically done by an in-house employee. In other words, it’s the process of hiring someone outside of your company to do a specific job or provide a particular service.
Clothing brands often outsource the production of their garments to factories overseas. This is done in order to save on manufacturing costs, as the labor is much cheaper overseas. There are also other functions that can be outsourced, such as customer service, bookkeeping, and even marketing. Outsourcing success requires a reliable partner with prices that make sense for your business.
However, even if you find the perfect outsourcing partner, there are still some risks involved which we’ll discuss further down.
Potential Areas You Can Outsource
As mentioned, there are a number of areas in your business that you can outsource. Let’s take a more in-depth look at some of the most popular facets of clothing brands like yours that are being outsourced:
Manufacturing is one of the most important but also the most expensive areas of clothing brands. Apart from securing your fabrics and trims, you also have to worry about the actual construction or printing of your garments. This is where outsourcing can come in handy.
Print on Demand
There are a few different options available when it comes to manufacturing outsourcing. One of the best-known is print on demand (POD). POD providers are essentially online printing companies that will print your designs on a garment and ship it directly to your customer. This is a great option if you don’t have the budget to invest in your own printing equipment or if you’re just starting out and don’t have the volume to justify the cost of setting up your own in-house printing operation.
Local Screen Printer
Another option for manufacturing outsourcing is working with a local screen printer. Similar to POD, this is ideal if you’re just getting started and don’t have the volume to warrant setting up your own in-house printing operation. The downside to screen printing is that it’s a bit more expensive than POD and you generally have to order in larger quantities.
For bigger clothing brands that need to produce hundreds to thousands of garments on a weekly or daily basis, working with an overseas manufacturer is often the best option. The main advantage of going this route is that you can get your garments produced for a fraction of the cost of what it would cost to produce them in-house. The downside is that there is often a bit of a learning curve when working with an overseas manufacturer and there is always the risk that something can go wrong, such as a delay in production or a quality issue.
Whether you’re a small start-up or a large clothing brand, there are a number of tasks that you can also outsource to freelancers. Platforms like Fiverr and Upwork have made it much easier for business owners to connect with individuals from different parts of the world who can provide a variety of services, such as design work, website building, managing listings on marketplaces like Amazon and Etsy, and customer service.
Similar to manufacturing outsourcing, working with freelancers can potentially save you a lot of money as you only have to pay for the services that you need when you need them. And since there is such a large pool of freelancers to choose from, you’re likely to find someone who can provide the services you need at a price that’s within your budget.
Pros and Cons of In-House Manufacturing
Since you may still be on the fence about manufacturing outsourcing, let’s take a look at some of the pros and cons of handling the whole process yourself.
Of course, one of the obvious advantages of manufacturing in-house is that you have complete control over the whole production process. This means that you can ensure that every garment is made to your exact specifications and that your quality standards are always met.
Another advantage of manufacturing in-house is that it can help you to build a stronger relationship with your team. If everyone is working together under one roof, it can be easier to build trust and rapport. This can lead to a more positive work environment and, ultimately, better quality garments.
Despite the advantages, manufacturing in-house can be costly and time-consuming for both small and medium-sized clothing businesses. For instance, if you’re just starting out, choosing to handle the manufacturing will definitely eat into your budget as you’ll need to invest in equipment, materials, and labor. And if you’re not experienced in managing a manufacturing operation, it can be very easy to make mistakes that can end up costing you a lot of money.
Another downside to manufacturing in-house is that it can be difficult to scale up your operation as your business grows. If you’re not careful, you could quickly find yourself in over your head, trying to keep up with the demand for your garments. This can lead to a lot of stress and anxiety, which is definitely not good for your business or your personal well-being.
Pros and Cons of Outsourcing Manufacturing Through POD
Feeling like in-house manufacturing might not be the best option for your clothing business? Then let’s take a look at some of the pros and cons of outsourcing through POD.
Print on demand is a heaven-sent solution for small businesses and start-ups as it completely removes the need for inventory. This means that you don’t have to worry about storing garments or predicting future demand, which can save you a lot of time, money, and stress.
Another advantage of print on demand is that it’s very easy to get started. Unlike manufacturing in-house, you don’t need to make a large upfront investment or have any experience in garment production. All you need is a design and a POD platform, such as Awkward Styles, to get started.
Print on demand is also a great way to test out new designs and styles without having to worry about excess inventory. If a design isn’t selling as well as you’d hoped, you can simply stop production without losing any money.
Of course, as with anything, there are also some disadvantages to using print on demand to outsource your manufacturing. One of the biggest drawbacks is that you won’t have as much control over the quality of the garments. This is because you’re relying on the print on demand platform and its team of manufacturers to produce your items. One way to go around this is to order a sample of your design before placing a larger order. This way, you can check the quality for yourself and make sure that it meets your standards.
Another potential downside to print on demand is that it can be a bit more expensive than manufacturing in-house. This applies to bigger brands or businesses that are ordering large quantities of garments. However, for small businesses and start-ups, POD can actually be a more cost-effective solution.
Pros and Cons of Freelancer Outsourcing
If you’re also thinking about working with freelancers to outsource the other aspects of your clothing business, such as design or marketing, then here are some pros and cons to keep in mind.
Aside from lower labor costs, working freelancers can expose you to a whole new world of talent and creativity. When you work with freelancers, you’re not limited to the talent in your immediate area. You can connect with freelancers from all over the world, which gives you a much larger pool of talent to choose from.
Another advantage of working with freelancers is that you can usually get started much faster than if you were trying to do everything in-house. This is because freelancers are usually already familiar with the processes and tools that they need to get the job done.
One of the biggest disadvantages of working with freelancers is that you don’t have as much control over their work. This can be a bit of a gamble, as you’re relying on them to deliver high-quality work on time. Nonetheless, open communication and thorough briefing can help to mitigate this risk.
Another potential downside to working with freelancers is that you might have to sacrifice some flexibility. This is because you’ll need to work around their availability, which might not always be convenient for you.
Pros and Cons of Doing Everything Yourself
And last but not least, let’s take a look at some of the pros and cons of doing everything yourself. After all, being a one-man team definitely has its advantages and disadvantages.
Of course, one of the biggest advantages of doing everything yourself is that you get to keep all the profits. You don’t have to share your hard-earned money with anyone, which can be a big incentive for some people.
Doing everything yourself also gives you a lot of creative control. You get to decide how your business is run and what direction it takes. This can be a great advantage if you have a clear vision for your brand.
On the other hand, doing everything yourself can be very time-consuming. It can also be quite overwhelming, especially if you’re trying to wear all the hats at once. This is why it’s important to delegate tasks and build a team of reliable people that you can count on.
Doing everything yourself can also limit your growth potential. There’s only so much that one person can do. You might find yourself hitting a glass ceiling if you’re trying to do too much.
That’s a Wrap!
We hope this article has given you a better understanding of the pros and cons of inhouse production vs outsourcing for your online clothing brand. There’s a lot to consider, but ultimately it’s up to you to decide what’s best for your business. The key is to determine where exactly you want to focus your efforts and what vision you have for your brand. With a clear plan and some hard work, you can make your clothing business a success!
For more print on demand and e-commerce tips and tricks, be sure to check out our blog!