I need to be more creative with the search feature

I suggest being proactive by posting the question. Ask and you shall receive.

Where could I read more about pricing private labels?

My advise would be to do a sample run for a private label project (definitely get paid for the samples – industry standard is 2x the production cost). Let them review the working procedures, the levels of communication, understanding and interpretation of requirements, delivery times and budget on the samples provided by your operation. This exercise not only builds confidence in your client on your manufacturing but also gives you an indication on how well they know what they want (designs, fabrics, patterns, etc), how clear and definitive their requirements are (avoid companies that change their mind every week)and finally if they pay their sampling bills on time – cha-ching!

In this industry, given the risks and changing variables in the global equation, the contracts and the deposits have to be strictly in place for the company mentioned in the post, as well as an operation as ours to stay in business in the US for years and decades to come!

Quoting Kathleen – “Get the money first: If you’re buying goods exclusive to the store’s request, they must agree to specific quantities and a down payment (at least 50%) is in order”…

We do get quite a bit of interest in co-branding though. Companies will buy our garments and then logo the exterior with embroidery or screen-printing. We’ve always done a little business with that. I expect it will reach 5-10% of our total for 2008, though the majority of that is from one customer.

I agree this wasn’t an unavoidable outcome. They should have gotten 50% of the total contract’s value, not 25% of the cost of inputs.

I hate to say this but this is a rather naive position for this contractor to be in. This illustrates in part, why suppliers and contractors DO NOT CARE how big you are, if anything, it can put you in a position to hurt them worse. Believe me, I hear plenty of complaints about big companies too, I just don’t print them because it’s germane to this site. Companies that should know better, get starry-eyed by a big brand name. What we haven’t heard is how many companies *Biggest* Name Lingerie retailer went to before this company, who turned them down cold.

{Hey… isn’t this a lean principle?}

Yes it is, absolutely. Lean practitioners don’t grind discounts out of vendors through heavy handed demands, they need them. Their strategy is to help suppliers get leaner so their costs and subsequent prices will decrease.

Census statistics from 2000 report 24.7% of the population living in poverty (compared to 11.3% for the US overall).

The manufacturing sector has been taking it pretty hard since the 1970’s, though apparently it’s starting to pick up again.

Oh my. You know, I hate hearing stories of shops that “lost their contract” and were subsequently forced to liquidate. It’s sad and unnecessary.

What’s worse, though, is that the majority of such cases are brought on by pride. In corporate lingo, we refer to it as “strategic distress”.

I know. I’m unpopular. I’m used to it. Just hear me out, please.

There are certainly extenuating circumstances we’re not privy to. However, demise was not a necessary outcome. Had this company recognized that this deal had potential to put the company at risk, then it would have been prudent to consult a turnaround specialist early on.

For the cost of a consultation fee, a turnaround specialist could have counseled this company and negotiated a stronger deal before the lawyers wrote the contracts. Of course, this necessitates early diagnosis which requires a mentality that no cow is sacred

{Hey… isn’t this a lean principle?}

When compared to the demise of the company, a TS’s consultation fee would have been much less expensive. And, therefore, a prudent investment. Plus, there are other benefits a TS brings. S/he could have pursued funding if it were necessary and then managed the company through the project to safety. If funding were not needed, the TS could have been retained as ad hoc counsel without changing the existing management structure.

The crux of what I’m trying to get at is that demise is never a necessary outcome. We need recognize that there is a world of options at our disposal if we can get past our pride and just ask the right people for help.