Explain Retail vs Contract Embroidery To Me

1679 Views 4 Replies 4 Participants Last post by LTPEMB, Jul 3, 2018

shoppoinsettia

Discussion Starter · Jul 2, 2018 (Edited)

Hi everyone! I'm new to this forum, and I've been working on getting some t-shirts embroidered for my new online business on Shopify (specializing in floral embroidered apparel). For context, I've been looking around and contacting some local embroidery shops like EmbroidMe San Diego (I think they do retail embroidery? Not too sure...), but then stumbled upon Atlas Embroidery. Upon reaching out, they told me that I had to be an ASI Distributor to be able to get their contract embroidery.

1. Could someone describe the difference between retail and contract embroidery? What sort of people is each targeting

2. Furthermore, what are your guy's thoughts on a Basic ASI Distributor Membership? I'm afraid I don't understand why Atlas Embroidery would only do contract embroidery with an ASI Distributor. What sort of people/businesses would choose to become an ASI Distributor?

Clearly, I'm quite new to all this, so any of your thoughts and input would be greatly appreciated! Thanks!

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splathead

· #2 · Jul 2, 2018

Retail are shops like EmbroidMe where they are usually set up in strip malls with signage to draw in passerbys.

Contract shops cater to the trade. They deal in volume where retail shops deal with one or a few.

I've never quite understood the ASI model myself. We use Fawn Industries, Custom Embroidery - New Park, PA (800) 388-FAWN, a contract house out of PA. They'll take bulk work from anyone.

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PatWibble

· #3 · Jul 2, 2018

The main diference is that contract embroidery/printing is usually only offered to someone in the trade. It is a way for shops to sub out larger orders or processes that they don't offer. ( not all printers offer embroidery, and not all embroiderers offer printing).

Order size is usually key, and minimums are often higher to qualify for contract rates. There is generally the assumption that most or all of the pre-production groundwork (artwork, sizing etc) is carried out by the contractee, and all the contractor has to do is produce the finished item.

Often the firm offering the contract embroidery will allow the contractee to provide the blanks, delivered direct to them. That way all that the contractor is missing out on is the profit on the blanks - the cost of actual embroidery will be similar to the retail price for the given quantity.

The advantage is that everyones a winner. The contractor earns the profit from embroidering without having to lay out any money or deal with the end user. The contractee gets to earn the profit on the blank garment plus maybe some more without having to actually produce the product. The end user gets what he ordered at a price that you have to assume that he is happy with.

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LTPEMB

· #4 · Jul 3, 2018

PatWibble said:
The main diference is that contract embroidery/printing is usually only offered to someone in the trade. It is a way for shops to sub out larger orders or processes that they don't offer. ( not all printers offer embroidery, and not all embroiderers offer printing).

Order size is usually key, and minimums are often higher to qualify for contract rates. There is generally the assumption that most or all of the pre-production groundwork (artwork, sizing etc) is carried out by the contractee, and all the contractor has to do is produce the finished item.

Often the firm offering the contract embroidery will allow the contractee to provide the blanks, delivered direct to them. That way all that the contractor is missing out on is the profit on the blanks - the cost of actual embroidery will be similar to the retail price for the given quantity.

The advantage is that everyones a winner. The contractor earns the profit from embroidering without having to lay out any money or deal with the end user. The contractee gets to earn the profit on the blank garment plus maybe some more without having to actually produce the product. The end user gets what he ordered at a price that you have to assume that he is happy with.

Pretty much nail on the head with the one exception.
Pricing for contract is usually priced generally much lower than that of comparable retail prices at quantities over 24-48-144 generally and with a scale of operation that larger quantities can cost even less per piece than retail could ever functionally make a profit on. That said quality/ability and so on are varied on both ends so price vs skill/ability for the price you are paying requires you to know the right questions.

(I currently am working on transitioning away from retail into contract if you charged retail prices to a trade business they wouldn't talk to you. if you charge contract to retail customers you would most likely go out of business for not charging enough for the sales time involved)

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LTPEMB

· #5 · Jul 3, 2018

Another similar term for contract, is Wholesale... except wholesale implys product where as contractor is more like a subcontracto for building a house

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