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Sourcing strategies | Buyer-Supplier Relationships

Are you making smart buying decisions?

So, last time we covered both the definition and the best way to find a good private label manufacturer for your fashion and apparel label or retail business.

We’ve come to 3 main conclusions:


Reliability is Key.

Don’t forget your department’s budget is on the line moreover, season collections have to be delivered in stores with no delays.  So be sure to get solid referrals.

Look into the human side.

Far beyond human capital or resources I’m really talking about the people who work and have worked there from the start, sometimes not just for the money, but because they really love and believe in the project.

Not everything is meant to be.

This is definitely not a one size fit’s all business. The supplier’s existing client portfolio and working dynamic has got to fit your sourcing needs.

Just by looking at the list above one can see a sourcing manager has to have a very broad skill set in order be able to deal with such different aspects of the clothing procurement process, such as supply chain management, fabric and accessories and buyer-supplier relationships and yet some more. In fact, this is a very interesting topic that I’ll cover in detail in a latter post.

For now, I’ll leave you 3 simple tips to know whether you are making smart buying decisions.


Cost Efficiency

The number one concern in any type of business is volatility. It’s quite simple, investors appreciate stability so they can anticipate returns. In recent years, I’ve witnessed an increasing number of successful retailers and brands adopt a strategy called “split sourcing” it goes a little bit like this: High end labels look for low-cost manufacturers for low-price point products and, this is very important, with predictable demand patterns.

For the remaining high-quality levels of clothing, that require ticket items, demand faster product development, with high-end levels of manufacturing expertise, rigorous quality control process and fast delivery, these brands tend to nearshore – manufacture close to their sales market.


With brand equity at stake top labels have increased compliance procedures to align industry standards and ensure transparency and compliance across the supply chain. An experienced supplier is familiarized with all the “paperwork”, actually nowadays they are just online forms, and knows how to fill them without a having panic attack.

You have to make sure this manufacturer is following international regulation and accords. Site visits are a great opportunity to engage more deeply with your supplier and find out more about building and fire safety compliance. This in fact is, according to a Mckinsey report, a top criterion for CPO’s when evaluating new sourcing markets.


Still have a middle man?

I’ll let you in on a little secret about how high-end labels and luxury brands maximize their margins.

Are you ready?

Maybe you aren’t still ready. So, I’ll just begin by telling you a little story that happened a while ago.

There was this high-end brand, lots of stores across the worlds very successful amongst customers and press and so forth. I thought – Those guys [who own the brand] must be rich.  - Well in fact it turned out that was not the case at all. The company was even struggling, at that time with some financial difficulties.

You see, they were buying from an agent or buying house I don’t exactly remember and where loosing process efficiencies along the way.  Does this happen every single time in every situation? Of course not.

I guess the lesson I learned here was control.

Oh. Yes, I almost forgot about that secret I was about to tell you. But then again, I already told you. It’s all about control. Controlling and real-time monitoring across the supply chain.