Which Country Is Better Option to Outsource Tshirts? China or India?

INTRODUCTION

Funky Daisy is an international fashion clothing and accessories brand founded in Sydney, Australia. It offers trendy and stylish apparel and accessories for fashion forward young women at affordable prices. It doesn't follow any particular seasonal trends and instead has its own unique set of inspirations – predominantly from the streets of various cultural capitals across the world. A lot of its products are heavily embellished to give it an extra edge that appeals to the young target market. One of the fastest growing Australian brands, Funky Daisy emerged in early 2005 as a start up retailer and expanded to Europe in mid 2008. It now operates in 80 stores across 6 countries.

Catering to women between late teens and late 20s in the casual fashion segment, Funky Daisy has a wide product offering ranging from knitted and woven tops and bottoms in apparel, and scarves, handbags, shoes and jewellery in accessories. It considers itself to be eco-friendly and its entire apparel line is made up of only natural fibres. Its signature product line is printed cotton t-shirts that are heavy embellished, either in the form of embroidery or beading work.

In order to compete in the global market in the mid-price women's casualwear segment Funky Daisy has decided to review THE outsourcing of its signature product line. Once the MFA quota system ended, nations that are sources of apparel production competed in other non-quota based factors. The following are the key factors (Kunz & Garner 2006):-

• Tariff structures

• Social responsibility

• Presence of free trade agreement

• Country's overall business climate

• Infrastructure conditions and logistics

• Proximity and access to major import markets

• Availability of low-cost, skilled workers

• Effective management

• Appropriateness of product quality

• Access to reliable supply of competitively priced materials

• Reliability of delivery according to specifications

• Levels of supplier service

Having broadly screened various nations Funky Daisy has narrowed down the list to two countries – India and China. This report documents the comparative analysis between the global value chains of the two countries and in the end identifies the country that is most suitable to import embellished printed cotton t-shirts into Australia and European Union.

Product Classification – HS code

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