Customization VS Spot: how to make the best choice when purchasing in bulk?
In the B2B apparel industry, volume purchasing is an important part of reducing costs and improving supply chain efficiency. Whether it's a wholesaler, a brand, or a corporate client, there's a key question when choosing a supply model: should you go for spot products or customized production?
Spot sourcing means buying products directly from a supplier's inventory, while customized sourcing involves designing and producing products that meet specific specifications based on customer demand. Both have their advantages and disadvantages and are applicable to different business models and needs. So how do you make the best choice when it comes to volume purchasing? This article will analyze the characteristics of customization and spot purchasing in detail, and provide decision-making reference.
A. Advantages of spot purchasing and applicable scenarios 1. Fast delivery, saving time Spot products have been produced, the purchaser can immediately place an order and arrange for delivery, delivery is usually completed within a few days. This is especially important for buyers who need to quickly replenish goods and respond to changes in market demand. For example: An apparel retailer needs to replenish stock before the peak season to capitalize on market opportunities. Online sellers want to shorten the sales cycle by having in-stock products on the shelves quickly.
2. Price Transparency and Cost Control The price of spot products is usually fixed, so buyers can clearly understand the cost of each product and make purchasing decisions based on their budget. At the same time, most suppliers offer laddered prices, the larger the purchase volume, the lower the unit price.
3. Reduced risk, suitable for small-volume purchases For buyers who are new to the market, purchasing off-the-shelf in bulk can reduce risk. Since spot products do not require additional design and production, losses due to improper design, color errors or size problems are avoided. In addition, spot purchasing usually supports small orders, reducing inventory pressure.
4. More flexible market testing For brands or wholesalers, spot purchasing can be used as a means of market testing. Buyers can first purchase a small amount of a certain product, determine the market demand through sales data, and then decide whether to increase the purchase volume or customized production.
Applicable Scenarios: Enterprises that need fast delivery and replenishment of inventoryCustomers with limited purchasing budgets who want to reduce cost fluctuations Brands or wholesalers who need to test the market with small quantities. Online platform sellers with short cycle operation mode
B. Advantages of customized procurement and applicable scenarios 1. Product differentiation, enhance brand competitiveness Customized products allow companies to adjust the design, color, fabric, size, etc. according to their needs to create unique products. This is crucial for brand building, especially in a competitive market where brands that can provide personalized products are more competitive.Example: High-end lingerie brands can customize specific styles to match the brand tone. Sports brands can choose eco-friendly fabrics and functional designs that fit their philosophy.
2. Meet specific needs and satisfy corporate customization requirements Certain corporate clients, such as hotel chains, gyms, and corporate uniform suppliers, often have specific apparel needs, such as brand logos, unique design elements, or specific functional fabrics. Customized sourcing can fully meet these needs.
3. Long-term cooperation and stable supply chain Custom sourcing is a way to optimize the supply chain if a company has long-term stable needs. By establishing long-term partnerships with suppliers, it can realize full chain control from design to production, improve production efficiency, and reduce long-term sourcing costs.
4. Higher profit margins Customized products have less competition and can help brands increase their premiums. As there are fewer similar products in the market, companies can set higher retail prices based on market positioning, thus increasing profit margins.
Applicable Scenarios: Enterprises with brand positioning that want to unique their products Customers who need to meet specific market demands (e.g. corporate uniforms, sports team uniforms) Brands planning long-term cooperation to optimize supply chain Companies with high customization budgets that want to improve profit margins
C. How to make the best choice? When purchasing in bulk, companies can make a reasonable choice based on the following factors:
1. Purchasing cycle and delivery time Short-term needs: If quick replenishment is needed, spot purchasing is the best choice. Long-term planning: If there is plenty of time, customization is an option to get products that are more in line with market demand. 2. Purchasing volume and inventory management Small Volume Purchasing: Spot products are more flexible and do not require inventory pressure. Large volume purchasing: Customized purchasing can optimize costs and provide a more stable supply.
3. Product Positioning and Branding Strategy Branding: Customized products can better reflect the brand value and improve market competitiveness. Price Orientation: Spot products have lower cost and are suitable for business model of winning with low price.
4. Budget and capital turnover Limited budget: Spot purchasing has less financial pressure and is suitable for startups or SMEs. Sufficient capital: customized procurement can gain long-term benefits although the initial investment is large.
D. Mixed procurement model: balancing the advantages and disadvantages of customization and spot purchasing For many companies, the best choice is not to rely entirely on custom or spot, but to combine the advantages of both. For example:
The main product is customized production, to enhance brand competitiveness and establish market uniqueness. Use spot sourcing for ancillary products to meet short-term market demand and reduce inventory pressure. Small batch spot test first, confirm the market demand, and then put into customized production.
Case Study: Sourcing Strategy of a Lingerie Brand A lingerie brand focusing on the mid-to-high-end market adopts a hybrid model in its sourcing strategy: Basic products (e.g. black and white regular bras) are purchased from stock to ensure fast supply. Specialty models and seasonal new products (e.g. Valentine's Day limited models) are customized to enhance the brand image. After discovering hot models through market testing, they are put into custom production to optimize supply chain management.
Conclusion In B2B bulk purchasing, customization and spot have their own advantages, the key lies in how enterprises make reasonable choices according to their own needs, market positioning, capital status and supply chain management. For enterprises that respond quickly to market demand, spot purchasing provides flexibility and cost advantages. For companies seeking brand uniqueness and long-term development, customized production is a more strategic choice.In the actual sourcing process, a hybrid model is often the smarter strategy to meet market demand while ensuring brand value is maximized. Hopefully, the analysis in this article will help companies make smarter decisions when it comes to volume purchasing and achieve sustainable business growth.
