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What? Some parts of my sock is still done in China? Questions, Questions...

HI readers! I am back and we have gotten various questions from readers and clients. I wanted to take the time to write a post to answers those questions so other readers may be interested in these question and answers.

Here are some of the questions we were asked, I only picked a few that I think is interesting to other people who are looking for sock manufacturing or sock sourcing in China. You can click on the questions to take you to the answers.

Question 1.
I make my socks in Vietnam and I realize if I start making slightly more complicated graphics or more colors, my production lead time goes up. Sometimes much longer than what a China manufacture quotes. Why is this?

While Vietnam is great on making the basic white and black socks, there are many infrastructure Vietnam is lacking in regards to availability of suppliers with techniques for graphics and yarn dye capabilities. Look at it this way, if Vietnam has 350 factories, China has 3000 factories. Which means China has more availability of options in regards to dye and print techniques. The Vietnam apparel industry is big, however many of them service the larger retailers and may not have capacity for you. So sometimes Vietnam factories will outsource the job to China for dye or graphic techniques. Hence the longer lead time in Vietnam. It's always about capacity and scheduling.

Question 2.

When I visit my non-China sock factory, I notice they do not take me to any yarn or dye manufactures, so I can review the process. Why is that?

There are several reasons why this may happen. The number reason is their dye or yarn manufactures will not allow you to visit for safety reasons. Dye facilities are very stringent in regards to environmental requirements.

Second reason is secrecy, your sock supplier may not want you to understand who produces the Yarn, so you cannot check prices.

The third reason is, the factory may be buying from an agent. This is quiet common because buying through an agent, means more focus on the manufacturing part.

Question 3.

Why are some countries socks cheaper than China? Why would I use China for socks, when costs are going up?

This is a common question that may not be exactly true. Cheaper doesn't mean it's the cheapest, unless you look at the final cost of your product. Final cost, must include cost of the sock, tariff, logistics, time, quality and service. Sometimes we are told, our socks are more expensive by $.20 compared to other countries, but when you factor all the events that can impact final cost, it's questionable who is more expensive.

Here is an example of an event that increases the cost of your supply chain. Imagine today your producing in country A but suddenly your manufacturing needs to close for Covid-19 or has government instability. But Country B is able to better handle Covid-19 and the government stability is strong. All it takes one scenario to cause a disaster for your business. Not having products during your most important holiday or products stuck in the port is a "Cost" to your supply chain.

When you think in these terms, China offers the best flexibility and stability. As our environment is robust with labor, capacity, and skills.

Question 4.

How can the price range be so wide depending on what sock factory I use?

Price difference can be based on several reasons when comparing with other sock factories in China.

  1. Factory management = Every factory has different management style, which will impact the labor/fee's. If you don't care about service or quality, then your probably working with a small factory with very little management. If you care about service/quality, then you most likely will pay a little more for that service.

  2. Factory's suppliers = Factories have their own suppliers with their own costs. Depending on the strength of that relationship, it impacts prices. If the supplier relations are strong, they will always have the best market prices for raw materials.

  3. Scheduling/Capacity = If a factory is full capacity, you may not get the best price because all their machines are running. So you sock manufacture may only be looking for customers who are willing to pay a higher price for their capacity. For example, if a factory had 500 sock machines, but 480 is already running for a large buyer, they have 20 machines left, they may only accept orders for those 20 machines that can squeeze more profit. You have to keep in mind, factories get 10's to 100's requests in a week, so they have many options to choose from.

  4. Old customer or new customers = Most factories who work with long term stable clients, will give better pricing to old clients. New clients pricing will always be a little higher to offset the risks of working with new customers. Risks such as ability to pay the bills, the unknown requirements from new customers, etc

There are other reasons but primarily what I listed above is true for many manufactures.

Question 5.

How come most factories do not want to produce small MOQ like in the 100's?

This is a very good question. Most manufactures don't want to do small jobs for 2 major reasons.

Number 1, the raw material supplier has an MOQ. Most of the time, factories have to purchase 100's of yards in Yarn MOQ. That is enough to make several thousand socks. The factory won't risk purchasing so much inventory for a small job. Another common misconception is, the factory can just buy the extra Material and use it for other sock orders. That is not true because different customers may require different materials, dye, etc. We have yarn colors in our inventory that has not been touched for over 1 year.

Number 2, their machine cost thousands to buy and their is upkeep costs throughout the year. A typical sock machine can produce 300-400 pair's of sock per day per machine.. Imagine doing a job for only 100 pair of socks. It takes 2-4 hours to setup a machine, than if they run 100 socks, it may take 2-3 hours. That is up to 7 hours of work for 100 pair of socks. Let's assume factory makes $.20 per sock, that translate to $20 profit for 7 hours of work. This doesn't include the cost of labor to clean/setup/inspect machine. So profit wise, it's not in the best interest of most manufactures.

These 2 reasons make it a challenge for most sock factories to accept small MOQ. So it's not we cannot do it, but it's really not worth it. You as the buyer want to make money and our sock factory has to also make money. It has to be a win-win situation. Of course sometimes you can find really tiny factories with 2-3 sock machines, who may do your order, but don't expect service/quality or consistency to do those orders.

Question 6.

Has Covid-19 affected your business? Has it gotten worse?

Covid-19 has impacted our sock business. Just like many other business, we are trying our best to get through this. However there has been an increase in requests due to other countries still lockdown by the Covid-19 situation.

We hope the information provided in this article can help improve your sourcing ability and help locate a supplier who can fulfill your needs. Please leave comments and subscribe to us if you want future articles. If you have any questions, please feel free to ask us!!



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