China Guangzhou Fabric Market – Friend or Foe?

Zhongda Fabric Market is likely one of the biggest in the world.  Supporting 4000 shops selling fabric and accessories suitable for all types of apparel products which get on sold all over the world.

Zhongda Fabric Market supports fabric supply flexibility and quick response.  It allows low volume high mix collections requiring a wide variety of innovative fabrics and designs where MOQ may not be achievable from traditional fabric mills.  Gives the ability to procure small fabric quantities to deliver collections in full.

While there are many benefits to such an array of stock and replenishment based fabrics, there are also risks:

  • Will the stock be available after the collection has finished selling if no pre-order has been placed?
  • Selected stock ordered by the vendor will it be first grade? A particular stock may be defective or cancelled by a previous customer, knowing this to be a reality 15% wastage will be added to the consumption by the vendor, increase the overall price of the garment.
  • In many cases payment terms are cash before delivery leaving the garment vendor in an awkward position if received fabric stock is defective or short length, further adding to the wastage need.
  • Where end garment order quantity is small, fabric needs to be purchased in roll length resulting in garment over or under supply if the % tolerance is low. Order fulfilment in full may be a challenge as would be excess inventory if not managed.
  • If the sampling approval process is not efficient, the garment vendor may substitute fabrics without notifying the customer.
  • Chemical Compliance, a vast majority of fabrics may not pass EU or US compliance standards as fabric and accessories may have been manufactured for the local market.
  • Fabric physical properties may not be fit for the garment intended due to colour fastness, seem strength and shrinkage.

There are definite advantages to Zhongda market in flexibility and MOQ, but there is also risk and a cost.  To make it a viable option for your business and still be able to supply quality that is acceptable to your brand you need to ensure you have the right sampling, development and preproduction process in place.  To support the process a person on the ground is necessary to police the process to ensure fast sample approvals and to assist in resolving challenges as they occur.

ID Global Concepts can help you through this process either through consultancy to establish the process or through a development management agreement.

If you would like to learn more or wish to discuss other supply chain challenges, please email us at info@idgc.co

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