MOQ stands for: Minimum order quantity. Ihis refers to the minimum number of units a supplier can manufacture at one time.
You may be wondering why the supplier sets a minimum order quantity. To some clothing brand, these numbers may seem a bit arbitrary and inconvenient. However, they are usually used to meet the manufacturer’s overall production cost. Without them, they can’t make a healthy profit every time they start a production run.
When a supplier sets their MOQ, the supplier must consider the cost of the production unit. So if suppliers are forced to build less units than their MOQ, they could lose money – not cool!
A garment factory may consider the following factors when setting up a MOQ.
Number one, the size of the plant, they may actually have the minimum number of units they have to produce in a single production run. The first consideration is the cost of production.
Second, the cost effectiveness of the machine, because every time you start the machine, it is a loss to the machine, and given that, it is not always cost effective for them to set up the machine unless they guarantee a certain amount of compensation.
Third, garment factories also have MOQ requirements when purchasing fabrics,so when they set up a MOQ,also will consider this factor.
However, this does not mean that all MOQs are non-negotiable. In fact, there is usually some degree of wiggle room.