Business Plan for Garment
Manufacturing Start-ups:
This article is written
to give you an idea how to make a business plan for garment manufacturing
start-up. What all things you can start working before the approach for an
expert's help. Instead of telling you how to start garment business, I will
share what are primary things you need to know, when you are ready to start
your business. There are two ways to a start business. One, first get customers
(buyers) and make products according to them and sell. Second, make your
product first and then get customers to sell your product. Whatever way you
choose to do business, you need to work on the following things to make your
project successful.
Read the step-by-step guide for making your business plan. In some steps
you might need expert's advice. In the article, I have included links for your
further reading to understand the business better.
Select Product Category
What type of garments you are going to make? If you plan to
make knits garment (T-Shirts, Polo), you would not try to make woven products
(Shirts, Trousers) at the same time. Again in woven and knits there is wide
range of product categories. Narrow you product profile as much as possible.
Let’s say, you are going to make woven shirts - Formals and Casuals. Write name
of the product in your note book and move to the second point.
Estimate Production Requirement
How many pieces are you planning to make daily? 50 shirts or
500 shirts per day? It would be difficult to decide the figure at this stage
but you have to estimate a rough number. Later you can modify this figure
depending on the budget and customer demand. Otherwise you can't move forward
making your business plan. When my clients ask me question how many machines
and what all machines they need to buy for their garment manufacturing set up,
I ask them what (product name or type) do they want to make and how many pieces
of garments they are planning to make per day.
Number of Machines
On the above I have said to you to estimate production
requirement. If you have decided the production figure, and product type,
number of sewing machines and other equipment requirement can be calculated.
Calculation can be also done in reverse way. In case you have a plan of setting
specific number of machines, and product type, estimated production per day can
be calculated.
Type of Machines
Next step is to find what types of machines are required to
make garments that you have selected from the wide range of product categories.
It is also important to find number of machines to be purchased in each machine
type. This step would help you to calculate capital investment in machines.
With sewing machines, make a list of other essential
machines, equipment and set up requirements. For example, pressing tables,
cutting room machines, Boiler (steam generator) for pressing table, diesel
generator for power back-up, finishing room equipment, furnishings etc.
Raw Materials Requirement
You have already selected the product that you are going to
make. Now make a list of raw materials required to make the garment with average
consumption. This would help you to prepare your budget on material sourcing.
Factory Space Requirement
Now move one step ahead. How much space is required for
installing machines and office for staff? To set up factory you need space for
installing machines, office space and setting up departments for production and
associated processes. Calculate space requirement. According to that you have
can plan for a factory building or rent a space. Estimate rent amount for the
project budget.
Manpower Requirement
You have already planned for machines and materials. Now
plan for the requirement of manpower for the business. Manpower is one of the
primary resources for a business. In manpower planning, include number of
staffs, supervisors and workers (operators and helpers) you need to hire to
make projected garments and to run business smoothly. Also estimate salaries
for each employee and add to your budget to running cost. Get an idea from the
market how much salary you need to pay to managers and workers.
Project Cost
I frequently get asked by people, how much money one needs
to invest for the small size garment business? Here it is. To know the
estimated budget you have to prepare cost of the project. You need to calculate
total capital investment, Rent, EMI amount (if you are taking loan), salary for
staff, workers’ wages and running costs. Also include finance required for
sourcing raw materials for initial
months and other expense etc. To run your business without financial problem,
prepare monthly cash flow requirement for at least one year.
To estimate project cost you can seek help from an
expert.
Internal Process Flow
Make detailed process flow of an order. This will help you
to decide what all departments you need to set up and you can plan hiring
people accordingly. You can cross check about your equipment requirement
process by process.
Supplier Listing
This process is not essential at first place. But you can
start working on finding good and reliable suppliers for fabrics, trims and
other necessary items required to manufacture your garments. Start establishing
suppliers with your region, then go to other state and even you can source from
international market for the quality and cost effective materials.
Reach to Your Customers
You have finished the major part of making the garment
manufacturing project. Now make a list of potential customers and start
contacting them for business leads.
If you are new to garment manufacturing and want to enter
into garment business seek help from an expert. An expert's guidance will help
you to save your time, money, and efforts. You can also learn many things about
the business insights from an expert. Wish you all the best for your upcoming
garment business project.
No comments