There are many factories in China, and these factories in the process of running their
operations have a tremendous amount of 
clothing overproduction from time to tome.


This category in the closeout industry
is created due to the nature of the process
that takes place between the factories, the
brands, and the retailers. 


For example, overproduction can occur because a factory producing merchandise for Calvin Klein wants to be sure that it will have enough stock to meet all of the future needs of the company.


Even if Calvin Klein only ordered 
1,000 dresses to be produced this time,
but the factory expects
that another 1,000 units will be ordered
next week, the Chinese dress manufacturer
might decide to continue to run
its machines and produce
2,000 pieces of clothing in one run.

Another instance that can take
place is the winter season in the USA is fast approaching, and the factory
produces women's jackets for Nine West, it will want to run its machines at full
steam to ensure that is has enough jackets available for Nine West.
But what happens if the winter in cities like New York or Chicago is not as cold as expected?


The factory will be stuck with all the jackets that it overproduced for Nine West.


The Chinese clothing factory understands
the consequence of overproducing apparel, 
but it would rather take a
small loss on the excess clothes than to lose wholesale buyers
that will switch their buying to another apparel producer.

If Macy's is left without enough products to
sell, it will not take a chance next season, and will give its
orders to another clothing supplier.


While many Chinese producers
implement sophisticated research systems
to monitor consumer demand, many are still working based on their perception of the market
and on feedback from the companies
that they supply merchandise to.


The factories in China know that they have
the option to sell their excess production
directly to wholesalers, importers, and retailers.
Be aware that in order to purchase any
brand name or designer overproduction
you need to have permission from the brand
or designer, not from the apparel manufacturer.


If a manufacturer makes suits for Tahari,
those suits can only be authorized to be
sold by Tahari.

You can also decide to look for merchandise
that has the Chinese factory's private
label and design, or simply
focus on purchasing the wholesale goods
directly from the companies for who
the inventory was produced for.


As a side note, it's interesting
that for instance you can have
a factory in Asia producing
dresses for different labels.
In theory, Ralph Lauren
and Anne Klein might
be ordering their dresses
from the same place,
but simply putting their
respective labels on 
once they receive their 
wholesale orders.


I have not conclusively
researched this, but
I suspect that this is
what takes place across
many wholesale product
categories.


Another way to purchase 
brand name and designer merchandise
at below wholesale prices
is by focusing on department
store overstock.


You are welcome to visit my
New York closeout warehouse
the next time you are in the USA.