HOW TO MANUFACTURE PRODUCTS OVERSEAS

During the establishment of manufacture concern business, the first and foremost thing is to decide whether to produce locally or to set up the entire or part of structure in abroad. This decision is very much vital and strong reasons are required if manufacturer prefers the later option.

At first, define the scope of your business carefully that is what will be the requirements of your product, what’s your estimated budget that you are ready to bear, either you want to produce standardized product or customized ones, whether printing or packaging are also required along with the production of product, whether you are introducing some innovation or not, do you want to involve research and development in determining customer’s need or quality control, are you ready to take the risk in starting business at some unknown place, do you make up your mind to bear import hassles including import duty, taxes etc and many more things to consider.

Well known strong apparel manufacturing concerns prefer to be indulged in the whole business setup from dyeing, cutting, stitching, to packing or may be up to distribution level. If the manufacture wants customized product with high quality in terms of fabric type, weight and fabric dyeing but these things are not available locally. Then one option is to spend a lot in importing fabric of desired quality also on the training of the workers to achieve the required dyeing, cutting etc. The second option is to set up the business where there are such things easily available. You can find a partner there and start working with him/her. It will save your cost and minimize the risk of loosing the quality in case if you started production locally with untrained persons. Therefore, the second option is better one.

In order to start up business overseas, the very first step is to decide the country where you want to start the production. This decision is very much important therefore think carefully. Don’t make rapid decision making. Consider all the important facts that have much impact on your business for example consider the economy of the country. If the economy is not strong and is in crisis, it will be a great risk in staring business there. Beware of all the import and export laws, tariffs and duties in relation to sourcing. The next much significant thing is the currency rate. If the currency of your home land is higher then definitely it is favorable for you because the cost of goods sold will be lesser. There are some policies related to import quotas. Every country is given some trade quota, you must be aware of this. Also think on the location of the country like where to produce and where to sell, if the shipment cost is higher then ultimately it will raise our product cost and less our profit margins.

You must have to do some serious research in populating the list of most important exporting countries. You can get such sort of information through internet easily. You should try to visit their websites and analyze their samples. You can explore through your research a wide variety of product styles. The purpose of this is to search out the manufacturer in your selected country who is meeting your requirements. It might happen that the manufacturer you selected may refuse you to work jointly. Hence, try to find out a list of possible manufacturers. The next step is to encourage to work.

In order to convince them, firstly equip yourself with the answers of all potential questions. Before starting this step you must be very well aware of your product requirements and specifications. You must have to prepare a small file that will be easily emailed with all possible details. Mention all the technical specifications also including labeling and tags’ details. Because it helps them to better understand what you want from them and in this way they can tell you better that on which terms and conditions they are willing to work with you.

Try to ask a list of questions too while interviewing the potential manufactures like what price they will charge for the product (based upon our requirements and specifications) per unit? What will be the lead time for sample? What will the lead time for final production? Means how much time you will require after the approval of sample to prepare the actual product. What number of quantity they can produce? Normal lead times ranges between 21 to 30 days. What percentage of upfront they require? Some manufacturers want 50% deposit in order to start the product.

At start sample evaluation is must and it may cost you more because it may be possible that manufacturer have to send you 2, 3 times for approval if it is not meting your requirements. As a buyer, you will have to suffer this cost. Calculate the sample systematically. After the approval of sample give them the signal to start actual production. If you have some deadlines then mention that to the manufacturer in order to get the product on time.
If you have many of manufacturers willing to work with you on your mentioned price, you can select the desired one based upon their product’s quality. Other most important thing is their response time. How speedily they respond? Language dissimilarity may cause some communication problem. You need to be very careful in this job. Remember this tip that try to recognize the maximum competencies of your manufacturer.

Next consideration is on payment making, you must need a Proforma invoice and necessary documents that your bank required. The payment is normally done on wire transfer. Once the transfer is made it will not take back.

When goods are received that they are packed in boxes and these boxes are numbered accordingly. You will receive the packing slip also. You can check that either these goods are according to the desired specifications. If goods are not in proper condition as evidence takes the snaps of those and send them back to your manufacturer

When you select to work overseas there are also of things that need to be considered. In short words it’s not an easy option to just start business overseas proper preparation is to be required.