This from a designer who lives in western Europe:

I started my line for children’s clothes a year ago and have sold both summer 2009 and winter 2009 collections to 22 retailers. Production is done in Turkey through an agent who gives the production to different companies as needed (knits, wovens, tricots, etc.). Production with three of the companies was no problem. Quality was fine and delivery on time. Production with the 4th company was a mess and they delivered late, bad quality and bad sizing (different than what we agreed). My mistake was authorizing the shipment without checking the shipping samples first (I thought the agent was doing her job at inspection, but she did not). I was lucky that my forwarder delivered the cargo to the warehouse without me having done the payment, so I could negotiate the claim amount.

I am now placing the orders for the winter production and I don’t want all this to happen again. My question is how do I write a contract with the sewing companies? Is it usual to write a detailed contract? This is new to me and last time all we did was a written confirmation on prices, quantities and an approximate shipping date. But how can I be better protected?

Sewing contracts:
A sewing contract per se remains quite rare. Usually the contract is the purchase order which is supplied by the factory. These can range from the very simple to the complex. Yours was perhaps too simple as it only listed price confirmation, quantities and shipping date. It’d be helpful to survey some of the sewing contract criteria listed in the Sourcing Cut & Sew Contractors folder in the forum. One template manufacturing contract can be found here; of particular interest is section one which reads:

MANUFACTURE AND SALE; DESCRIPTION
Seller agrees to manufacture and sell to buyer the following goods: _________[describe goods and set forth specifications] (the “goods”).

This is where you’d use the tool increasingly favored by the designers -a tech pack– to define the parameters of acceptable work. Unlike other types of contracts that are largely useless, tech packs are an insurance policy that itemize the criteria of your product, defining the duties and expectations of each party in the relationship. Most tech packs are generated with PLM/PDM software (I’m an unrepentant fan of StyleFile; the lowest cost and best tool on the market) but you can create your own with Exel spreadsheets. If you’re uncertain as to the kind of information to include, see this wiki and these previous entries (the comments are just as informative).

In other words, if in using this contract, the factory did not adhere to the criteria listed in the tech pack, you’d have grounds for recourse -however tenable that may be- which brings me to another point; the quality of tech packs can vary a lot. A quality tech pack isn’t necessarily one that contains a lot of data and text. Ideally, a tech pack is visual; the product is illustrated (again, see those links for pictorial examples). Particularly with overseas contractors, one must assume language differences because one cannot assume the document can or will be read no matter how complete it is. Besides, a lot of text is overwhelming.

I don’t know if you did this, but sending your pattern and a finished sample is best, it takes fewer iterations. When you receive the sample back from the factory, you must check it. You will have to line up the pieces to the original pattern to be certain it was followed. Here are some choice comments from someone who has worked a lot with overseas contractors. On this page you can scroll down to “contents” and get an idea of what sorts of things to check.

Obviously, all of the above presumes you’re using the standard protocol of having the factory render a sample for approval in advance of signing a work or purchase order. Even so, I recommend including a tech pack that is intended for production, to be used in the sampling phase. The reason being, hopefully they will find any inconsistencies or errors that may exist. Or, it may be the factory will not have the means to do some of the work in the manner in which you have specified. If they have a reasonable alternative, you’ll need to modify the tech pack to include that as it will be the final arbiter of the work definition. Be sure to update your documents and date them because the document with the most recent date is precedent.

My last favorite resource for these tasks is a book called The Vendor Compliance Handbook. I liked it so much I wrote a two part review of it. Frankly, I wish I knew enough to have been capable of writing this book myself. One last resource is Birnbaums Global Guide To Winning the Great Garment War. Nobody listens to me but I think it’s akin to lunacy to manufacture abroad without having read this book (easy fun read too).

Using an agent:
Before closing this up, let’s back track a bit to your agent. Obviously you’ve learned the hard and expensive way that relationships are everything. For others who don’t know, these relationships can work a variety of ways. You can hire what amounts to a freelance production manager who places your production with different companies for a set fee. If one is doing large quantities, this amounts to a few pennies per piece. The value of the relationship is that the production manager is responsible for the output of the factory. It is their responsibility to monitor ongoing processes and interface with you over any difficulties. These things must be itemized in the contract. Otherwise, you’re then stuck calculating discounts for sewing defects.