Micro Production How Small – Batch Manufacturing is Transforming Fashion Startups

This article will explore how micro production, small-batch manufacturing, is revolutionising the fashion industry, particularly for startups. While print on demand (POD) has grown in popularity, micro production offers a viable alternative that balances speed, sustainability, and cost efficiency. We will discuss how small-batch production reduces overstocking risks, meets consumer expectations for rapid delivery, and allows brands to react quickly to market trends while maintaining sustainable practices. Case studies and examples will illustrate the growing shift towards micro manufacturing.

The Shift Towards Small-Batch Manufacturing

Bulk manufacturing dominated production lines for years, allowing businesses to rapidly scale-up and reduce their cost per unit. It did, however, have major challenges. Bulk manufacturing often leads to overproduction, waste and unsold goods, three things that are not good for our planet. With a need for sustainability higher than ever, businesses were forced to rethink their production impact on the planet.

To combat this, businesses began adapting to small-batch manufacturing – an agile and sustainable alternative to bulk manufacturing. The introduction of limited quantity production has meant that businesses are able to reduce waste production whilst improving their control over quality. It’s a huge leap in response to consumers’ growing need for personalised and sustainable products.

Print on demand, otherwise known as POD is a similar model where products are only manufactured when an order is completed, or ‘on demand’. Despite this production method removing the risk of overproduction, it does typically result in higher per-unit costs and longer turnaround times. In contrast, small-batch manufacturing balances efficiency with flexibility, allowing businesses to maintain a curated inventory without excessive upfront investment.

Why Large-Scale Production is Becoming a Problem

Traditional large-scale production models, particularly in the fashion industry, are increasingly facing significant challenges that impact financial performance, brand reputation, and environmental sustainability.​

Overstocking Issues: H&M

One example of overstocking issues is H&M. The retailer had $4.3 billion worth of unsold inventory in 2018. The company was forced to heavily discount the surplus stock in brick and mortar stores around the world in order to manage the overstock. According to a report from Business of Fashion, ‘Digital disruption and changing consumer behaviours are upending the traditional retail model, leaving established players battling to stave off competition from e-commerce upstarts with lower costs and more efficient business models’. 

Financial Losses and Forced Discounting

Changing consumer preferences are often out of retailer’s control, which can result in overproduction, and in turn, unplanned sales to shift excess stock. Another example of excess stock is Marks & Spencer. The company were forced to re-adjust stock-flow and discount coats, jackets and boots by 20% to clear excess stock as milder weather combined with customers cutting back led to poor sales for some winter ranges. The unforeseeable shift in consumer behaviour resulted in reduced profit margins.

Environmental Harm

Overproduction of garments has serious effects on our planet. Some shocking facts from a 2024 study on sustainable fashion by A.M. Custom Clothing include;

1. The textile industry is responsible for 5-10% of global emissions.

2. The fashion industry accounts for 20% of industrial water pollution.

3. 73% of waste clothing is sent directly to landfill.

4. As much as 40% of manufactured clothing is never sold or worn.

Challenges in Demand Forecasting

Accurately predicting consumer demand is particularly challenging in fast-moving industries like fashion, where trends can change rapidly. Inaccurate demand forecasting can lead to overproduction, resulting in financial losses and inventory management issues. ​

These challenges underscore the need for more agile and responsive production models, such as small-batch manufacturing, to align supply more closely with actual consumer demand.

Meeting Modern Consumer Expectations

Consumers born between 1997 and 2013, otherwise known as Generation Z, are reshaping the fashion industry with their retail expectations. Let’s explore what we mean by this.

Speed, Price Sensitivity, and Sustainability Demands

Gen Z consumers desire instant access to emerging trends at low prices, fuelling the rise of ultra-fast fashion brands such as Shein. Studies have shown that 58% of Gen Z consumers want to purchase sustainable garments, but the temptation of easily accessible, cheap clothing often leads them to purchasing fast fashion.

How Amazon and Fast-Fashion Brands Have Reshaped Delivery Expectations

Companies like Amazon have revolutionised delivery expectations by implementing advanced logistics and technology, setting new standards for delivery speed and convenience. Innovations such as autonomous vehicles, drone deliveries, and AI-driven route optimisations have enabled Amazon to offer same-day or next-day deliveries, significantly raising consumer expectations. Fast-fashion retailers have adopted similar strategies, ensuring rapid product turnover and swift delivery to meet the demands of trend-focused consumers. ​https://roundtrip.ai+4Mana+4https://roundtrip.ai+4

Why Small-Batch Production Aligns with These Expectations Better Than Print-On-Demand (POD)

Small-batch production offers a strategic advantage in aligning with modern consumer expectations:​

• Speed: Producing in lower, limited quantities ensures that products are instantly available, meeting the consumer desire for speedy access to new trends.
• Quality Control: Small-batch production typically results in increased continuity and reduced risk of stockouts.
• Price: Small-batch production provides increased savings when compared to single unit on-demand production.
• Sustainability: Smaller production lines minimise the risk of waste production, while increasing speed of delivery, aligning with the sustainability values important to many consumers, including Gen Z.​

On the other hand, print-on-demand production only occurs after an order is placed and not ahead of purchase. This often results in longer turnaround times, which is a drawback for consumers such as Gen Z, who rely on speed.

By adopting small-batch production, businesses can effectively balance the need for rapid availability, quality, and sustainability, better meeting the multifaceted expectations of today’s consumers.

The Benefits of Micro Production for Fashion Startups

Fashion startups face unique challenges in balancing supply and demand due to ever-changing consumer preferences. Producing in smaller, controlled batches, otherwise known as micro production, has emerged as a powerful solution that offers agility, financial stability, and sustainability.

Reduced Risk of Overstocking

Unlike bulk production which often results in product waste, diminishing returns and disposal of unsold products, following a micro production model eliminates these risks. Companies only replenish inventory only when needed, rather than producing based on demand forecasts. This approach helps to reduce the risk of overstocking.

Faster Reaction to Trends

With new trends often emerging overnight and quickly fizzling out, fashion startups who embrace micro production have an advantage over POD companies. Small-batch production allows for rapid turnaround, which is imperative to be able to quickly produce garments that feature latest trends.

Cost Efficiency

Avoiding overstocking can diminish high costs, despite typically resulting in a higher cost per unit. This is because small-batch production allows brands to test demand ahead of scaling their business production, ensuring that spend is not wasted.

Sustainability

By only producing when orders have come in, companies can significantly reduce their textile waste, which aligns with consumer demand for sustainable fashion.

Fewer unsold items mean less landfill contribution and localised or on-demand production models minimise emissions associated with large-scale global shipping. This sustainable approach not only benefits the environment but also strengthens brand reputation among eco-conscious consumers.

Fashion startups can benefit hugely from micro production. It creates a pathway to strengthening reputation among eco-conscious consumers, flexibility to adapt and reduce textile waste.

Brands Leading the Way in Micro Production

Let’s have a look at some of the brands that are leading the way in micro production. These brands have managed to reduce their waste, improve their efficiency and have the ability to jump on apparel trends as they happen.​

High Hope Clothing: Leveraging Direct-to-Garment (DTG) Technology

High Hope Clothing, an independent UK brand, draws inspiration from nature to create modern designs. By utilising Direct-to-Garment (DTG) printing, they efficiently produce high-quality, full-colour prints on apparel without the need for extensive setups. This method allows for on-demand production, minimizing overstock and aligning with sustainable practices. ​uk.gymshark.com+2High Hope Clothing+2thetshirtprinters.com+2Wow! Custom Tees+5A4 Apparel Ltd+5nwcustomapparel.net+5

Gymshark: Implementing an In-House Micro Factory

Gymshark, a prominent fitness apparel brand, has invested in in-house production capabilities to enhance its responsiveness to market demands. This strategic move enables rapid prototyping and the release of limited-edition products, allowing the company to stay ahead of trends and maintain a competitive edge. Additionally, Gymshark is committed to sustainability, aiming to use 100% recycled polyester by 2025 and publishing their factory list to promote transparency.

Outsourcing vs. In-House Micro Production

A huge decision that fashion startups will have to make is whether to host their micro production in house, or whether to outsource production to a reputable partner. Each process comes with its own pros and cons, so let’s delve into them a little deeper.

Pros and Cons of In-House Micro Production

Having an in-house production line provides complete control over the production of your products, as well as the production quality. However, it will entail a significant upfront cost to cover equipment.

Pros of In-House Production:

• Having complete control over all aspects of production.
• Faster turnaround times, with no reliance on third-party production queues.
• Ability to customise your garments.

Cons of In-House Production:

• High upfront costs to cover equipment, materials, staff and operations.
• Limits to upscaling production due to the need for additional investment and resources.
• Managing production, quality control, and compliance adds operational challenges.

The Benefits of Outsourcing: Scalability, Flexibility, and Access to Advanced Technology

Outsourcing micro production allows smaller brands to benefit from the expertise of established manufacturers without the burden of upfront costs. Many manufacturers specialise in small-batch production, offering scalable solutions tailored to emerging brands.

Key Advantages of Outsourcing:

• You have the ability to scale up or down your production at any time.
• No initial upfront costs to purchase machinery.
• Gain access to advanced technology, printing and materials through your production partner.
• Focus on other areas of your business that can aid in company growth as you won’t be running the production line.

Why Outsourcing Works for Small Fashion Brands

For startups and in many instances established companies, outsourcing provides a low-risk way to bring products to market quickly and efficiently. It eliminates the need for heavy capital investment while ensuring access to high-quality production and cutting-edge techniques. By partnering with the right manufacturer, brands can achieve the agility and responsiveness that micro production demands, without the operational complexities of running a full-scale facility.

The choice between in-house and outsourced production is a decision that should not be taken lightly. Startups should consider their financials and growth plans before making a decision that is best for their unique circumstances.

Fashion startups can reduce the risks of overproduction, reduce their environmental impact and have a competitive edge when embracing small-batch production.

As the demand for sustainable clothing increases, as well as speedy shipping options and customisation, micro production manufacturing allows startups to meet the demands of their audience without compromising on product quality or efficiency. Case studies from brands such as Gymshark highlight how small-batch production elevates a brand’s success, by improving sustainability, reducing deadstock and diminishing waste.

As discussed, the decision for startups to opt for in-house production or partnering with an outsourcer will depend on their financial resources and long-term plan. Whilst in-house production offers greater quality control and opportunity to jump on trends, outsourcing allows greater flexibility for scaling without an upfront investment.

Adopting small-batch production allows fashion startups to position themselves as innovative, high-quality and sustainable. Not to mention they will have a competitive edge when it comes to fast delivery times. Just four of many ways that aligns with the demands of today’s consumer.