Benjamin Muminovic is a young self-taught entrepreneur who has been able to showcase his skills. He is only 23 years old and already generates several million euros. He is the founder of several international brands.
The young Bosnian, who did not hesitate to launch himself into entrepreneurship. He is interested very early in digital, mainly in e-commerce. Today, he is one of the people qualified to help us answer the question: getting lower MOQs with Chinese suppliers? Is it possible?
The prerequisite with Benjamin Muminovic
To begin with, you should know that factories around the world generally require a minimum order quantity (MOQ) to start the manufacturing process. Obviously, China is no exception. These MOQ levels ensure that the factory is able to recover the costs of specialized tooling and custom manufacturing associated with new orders. Below a certain threshold, order fulfillment is a loss-making proposition.
But that doesn’t mean that all Chinese apparel factories require the same minimum quantities. If you do your homework, you can find a low MOQ Chinese apparel manufacturer. Or you can negotiate a better deal with a manufacturer willing to work with you.
Why do MOQs exist Benjamin Muminovic?
Consider what a factory must do when preparing to produce a new garment order. Before manufacturing can begin, the production line must be retooled to meet the specifics of the order. Worker training may be required. Specialized equipment may also need to be procured if the production requires something that the factory does not already have online. The factory must also procure raw materials, custom printed textiles, buttons, hardware, etc. And suppliers usually have minimum order quantities.
Now imagine that you want to order a single custom jacket. All the initial factory start-up costs and material quantities would have to be borne by the price of that one piece of clothing. This is of course unfeasible, as it requires an absurdly high cost per unit that no buyer could afford.
If these costs were amortized over 100 jackets, the price per jacket could be significantly reduced, but would probably still be too high for most buyers. For the factory to offer a competitive unit price, it must set minimum order quantities. Above this threshold, the start-up costs of the factory can be amortized economically without adversely affecting unit costs.
These minimum order quantities also serve a secondary purpose. They separate the serious buyers from the day-trippers. Firms that can afford to pay a manufacturer’s MOQ are less likely to cancel. They are more likely to have the resources to pay the bill when it comes due.
In short, MOQs help factories keep their prices competitive and ensure that they can recoup their initial manufacturing costs. But you can find a low MOQ Chinese apparel manufacturer if you work at it.
Your tips for negotiating reduced minimum order quantities
In the following, you have some ideas to try. They may not work with all manufacturers, but there are many to choose from. These are strategies that we use ourselves.
Demonstrate your ability to stay put
Manufacturers may be willing to lower their standard MOQs if you can convince them that your first order is likely to become a regular order. Show them that you have done your research and that there is a market for your apparel products. Show them that demand is high for your product category in general and that your unique selling proposition will allow you to capitalize quickly.
Use quality control to your advantage
If it’s not certain that your clothing line will be a success, you won’t be able to use the promise of future orders to woo a low MOQ Chinese clothing manufacturer. Instead, you can turn the tables and challenge the manufacturer’s business practices.
You can insist that their standard MOQ is too expensive, because you don’t know if they will be able to meet the quality standards you have set for your products. You might say that you can’t afford to end up with 1,000 units of poorly manufactured goods.
If you try this angle, make sure you have determined a minimum order size that you can afford. Also, specify the exact quality parameters you expect from the manufacturer. Finally, let the manufacturer know that the minimum order amount you prefer will allow you to have the quantity needed to perfect your product. Indeed, the idea will be to promise improvement based on user feedback to ensure that the next, larger production run will be perfect.
Depending on the manufacturer’s current situation, they may be willing to lower their MOQ in order to win your business.
Muminovic Benjamin tip, offer a higher unit price in exchange for a lower MOQ
If the mills have some flexibility in their minimums, they may be willing to lower them if you agree to an increase in price per unit. This arrangement can be a win-win for both parties. You get a Chinese garment manufacturer with a low MOQ, and he gets a new customer.
The buyer wins if the extra cost is less than what he would have had to pay assuming a standard price. The manufacturer benefits from a new market without having to reduce the cost of entry as low as it otherwise would have to. But, be careful to do your math. If the higher unit price multiplied by the minimum order reduction comes to the same as your original cost, you have gained nothing.
Offer to pay a portion of the start-up costs
It is likely that the manufacturer will apply a markup to their initial costs and then amortize it over your first order. In exchange for a lower MOQ, you can offer to pay a portion of his actual upfront costs. This will help them recoup some of their initial investment while costing you less in total. This can also be a good leverage point in your efforts to find a low MOQ Chinese garment manufacturer.
Get quotes from manufacturers of all sizes
It may seem reasonable to assume that only large manufacturers have the operational flexibility to offer reduced MOQs. But that’s not necessarily true. They certainly can, but they often don’t need to. They tend to deal with larger buyers who don’t have a problem with their standard MOQ levels.
Sometimes it’s the smaller plants that are more flexible. They recognize that smaller buyers cannot compete when faced with high MOQs. So they are more willing to negotiate to close the sale.
Smaller companies also tend to suffer more from market fluctuations than larger manufacturers. As a result, they are more likely to experience hard times and suspend their normal MOQ standards in an effort to fill their production pipeline.
In general, it is wise not to prejudge manufacturers. You never know what is going on for them, and you never know when the window of opportunity is open. The low MOQ Chinese apparel manufacturer you are looking for could be your next phone call.
The ideal according to Benjamin Muminovic! Plan a business trip to China
Trying to get lower MOQs by phone and email can be difficult and frustrating. If you are unlucky, it can be helpful to get out in the field and talk to manufacturers in person. Wholesale vendors abound in China, as do large-scale organized markets where you can meet them. In many cases, these markets are the best place to find a wholesaler willing to work with you.
It is also helpful to get to know a vendor in person. It is easier for both parties to get a feel for each other. You may find it easier to convince a low MOQ Chinese clothing manufacturer in a face-to-face conversation than over the phone.
You may not be able to find a low MOQ Chinese apparel manufacturer willing to fulfill your request. You may try to partner with one or two other companies, submitting your orders together, thus sharing the minimum. Trading companies are third parties that help set up this type of shared orders. By sharing the start-up costs with other companies, you get everything you are looking for: a reduced MOQ and low unit prices.
It is difficult to find reduced MOQs, but it is not impossible
Sellers of low MOQ Chinese clothing manufacturers do exist. You just have to be diligent and tenacious to find them. It’s all about the numbers. The more manufacturers you talk to, the more likely you are to find a company willing to work with you. But don’t give up!
You certainly don’t want to put your company in a difficult situation where you’re paying more than you can afford. If you find that you are not able to sell the volume of clothing you have made, you may find yourself out of business. You may be forced to go through a slow and painful process.
By following the above tips, you will be well on your way to finding a low MOQ Chinese clothing manufacturer. There are some who will be happy to fulfill your request in exchange for a long-term business relationship.