Why Factory Direct?

A dear friend of mine asked me yesterday why buying factory direct is good. Sure you get your jeans at a better price buying straight from the factory, but so what? After talking a bit more it became clear that he didn't mean good in the sense of better quality for less, but good  in the sense of what benefit does it add to society? Take Tom's, for example, who give away a pair of shoes for every pair they sell. So how is factory direct good for society? That answer isn't as straight forward as "a pair of jeans to someone in need for every pair you buy" but that doesn't mean there is no social benefit.

The primary benefit of factory direct is job creation. Apparel manufacturing has almost become a lost art in the USA. Only 2% of all clothing sold in the USA is actually made here. 2%! Don't believe me? Go to your closet and check out the tags on all your clothing, including the big American brand names in jeans. Almost every major brand has outsourced production overseas because they can make jeans cheaper there. A lot cheaper. But it comes at the cost of having to manage an international supply chain and distribution system. 

The Factory direct model is the best way to bring apparel manufacturing jobs back to the states.You can pay line workers $15 an hour because you spend less on inventory and distribution, and eliminate the retailer markup. This means you are providing good paying jobs for hard working Americans all while giving customers a better product at a price comparable to that of jeans produced overseas. That is the social benefit. 

 

Robert McMillanComment