The Sourcing Journal
Practical guides on prototyping, sampling, factory vetting, and everything else in between.
Top 10 manufacturing hubs in Latin America
Discover Latin America's top 10 manufacturing hubs offering nearshoring benefits, skilled labor, and efficient sourcing strategies for global production right
The Best eCommerce Platforms in 2024
https://www.thebalancesmb.com/best-ecommerce-platforms-4844926 https://www.techradar.com/news/the-best-ecommerce-platform
Apparel Textiles Made Next Door in Latin America
Latin America is home to some major textile-producing nations, such as Peru, Brazil, and Colombia. Peru is South America’s biggest clothing exporter, and it boasts of unique domestic raw materials, especially alpaca fiber and Tangüis cotton. Brazil, a BRIC country, has enormous growth potential in both its textile supply chains, natural fibers and man-made fibers. Colombia is also expected to witness great opportunities in the textile and fashion market. Meanwhile, the CAFTA-DR countries – Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua – are eagerly competing among themselves and against Haiti for niches in the US market. Buyers’ interest in South America also remains firm. In Colombia, for example, garment shipments grew 50 percent to $900 million in 2021, export lobby ProColombia President Lavia Santoro said during the latest Colombiatex de las Américas textiles fair in Medellín. The two-day event last month drew 270 companies to source a range of textiles, including technical fabrics with antibacterial, solar shielding and impermeable properties, among others. Latin America Apparel Exports Seen Growing at 10% Latin America’s apparel exports are expected to increase sharply this year as U.S. brands boost orders south of the border to help ease supply chain woes. An estimated 10% increase in apparel sales is expected as U.S. buyers continue to engage in near sourcing and seek competitive places such as Mexico, which is only 24 hours away by truck. This phenomenon is also lifting demand for Central American and Colombian garments. For Mexico specifically, shipments could hit $7 billion this year after rising 6 to 8% in 2021. Brisk sales of knitwear, T-shirts, polo shirts, lingerie, underwear and socks are seen fueling those gains. Large & Growing Markets Latin America and the Caribbean are emerging as potential growth markets, driven by the increasing domestic demand, economic growth, and purchasing power. Investment possibilities in Latin American countries, such as Brazil, Mexico, Argentina, Colombia, Venezuela, Chile, Peru, Ecuador, the Dominican Republic, and Uruguay, are abundant. The popularity of the American lifestyle and the strong influence of the United States on the culture and consumption patterns in Latin America wooed fashion names, like Tommy Hilfiger and Nike, to launch their retail operations in Mexico and Brazil. Spanish fashion verticals, like Inditex and Mango, changed the way people in Latin America shopped, pushing the domestic fashion retailers to focus on product quality and offerings. Key Market Trends affecting these growth patterns for Latin America includes the following: 1. Increasing Cotton Production The production of organic cotton has been increasing worldwide, including in Latin America and the Caribbean region. The region registered a significant growth rate of 27% during 2018/19 and accounted for around 0.3% of the global organic cotton production. The region recorded a growth of a total of 666 metric ton (MT) of organic cotton fiber, which has great potential for substantial growth. Cotton production stemmed from the leading Latin American countries during the period where Argentina achieved 10.8 MT, followed by Brazil with 97 MT and Peru with 558 MT. 2. Trade Restrictive Measures in China The US and Canada are imposing trade-restrictive measures on major suppliers in China in response to concerns about forced labor practices in the country. Further, there are increasing civil and governmental pressures to bring manufacturing and its attendant jobs back to or nearer to the US and Canadian markets. 3. Post-Pandemic Need for Diversification A collaborative effort by textile and apparel manufacturers in Mexico, El Salvador, Guatemala, Honduras, Haiti and the Dominican Republic is leading to a resurgence of investment. There are noticeable vulnerabilities in brand and retailer supply chains that are prompting businesses to consider changes. Most companies are reassessing and restructuring their global supply chains. The economic costs to retailers are resulting in physical presence reductions and closures of stores. The reduction of stores means a reduction in inventory. As such, brands are looking at rebalancing their sourcing to ensure they are not “overexposed” in one geographical area; are considering a “hub and spoke” sourcing model to manufacture in geographical proximity to the target market; are looking at vertical manufacturing locations either as an individual country or as a close geographical region of countries; are looking at sustainable production to meet growing consumer demands; and are looking at nearshoring suppliers as it helps to meet several of the sourcing restructuring objectives. Conclusion Latin American countries can take advantage of the evolving situation and become a post-pandemic manufacturing destination if they engage in a collaborative public/private sector effort that includes continued steps to: ● Demonstrate flexibility and quick response to market circumstances ● Maintain versatility in production and supply chains for e-commerce and drop shipment supplies ● Develop verticality in supply chains for yarns, fabrics, and apparel by working as a regional coordinated supplier ● Capitalize on their proximity to, and free trade agreements with, the US and Canada ● Provide complete visibility into their supply chains to demonstrate that no forced labour is used. Other recommendations include accelerated trade lanes for trusted or known traders, cooperative agreements with the US and Canada for pre-approved customs clearance for shipments, regional education and training initiatives, and integration of existing free trade agreement provisions. About Papaya Marketplace Papaya marketplace offers buyers a full service experience in the origination, sourcing and managing of products. The platform was founded on the idea that curation and service are the most important elements in the buyer’s journey. Papaya Marketplace is building technology that addresses the pains of sourcing products internationally at attractive prices.
Shopify vs. Amazon: Which Platform is Best for your Ecommerce Brand
One of the most important decisions you will make when selling your products online is choosing the ecommerce platform that will work best for you. It’s likely that when you are making this decision, you’ll look at Amazon FBA vs Shopify and wonder which you should use, as they are two of the most prominent players around when it comes to ecommerce. Amazon and Shopify have both built vast reputations, with Shopify powering over 800,000 businesses and Amazon receiving 2.5 billion visitors every month! For most entrepreneurs, these amazing stats make it a hard choice, as both platforms are reliable in the world of ecommerce. Shopify and Amazon: The Main Difference Shopify and Amazon are absolute giants of the ecommerce world. But although both services let you put your products in front of a huge audience, they are very different platforms. Shopify is a tool that lets you build your own online store. By contrast, Amazon IS an online store (and a HUGE one at that: last year, US-based Amazon sellers sold 3.8 billion products, which equates to 7,400 per minute!). When you sell on Shopify, it’s the online equivalent of renting a space in which to set up your own shop. But working with Amazon is more like selling your goods in a massive supermarket. With Shopify, you’ll have more work to do to configure things the way you want — and find customers. However, you’ll have total control over everything — you can decide: 1. How your brand is presented 2. What your storefront looks like 3. How you advertise your products 4. How you capture data 5. The way you sell your goods With Amazon, the customer base is already there…but so is the competition. Other Feature Comparisons For those who are in need of a break-into-pieces comparison between Shopify dashboard vs Amazon marketplace features, a more complete breakdown is provided below : 1. Pricing Shopify offers a 14-day free trial and 3 pricing plans: (i) Basic Shopify plan: $29/month (ii) Shopify plan: $79/month (iii) Advanced Shopify plan: $299/month The more expensive your Shopify plan is, the more features it has. It is also notable that you can upgrade or downgrade your plan anytime. Shopify also offers a 10% discount for an annual payment and a 20% discount for biennial payments if you pay upfront. Amazon has two pricing plans: (i) Individual sellers: 99 cents per item sold. This plan only lets you add new products to the Amazon catalog and use Fulfillment by Amazon if you want to. According to Amazon, this plan is suitable for sellers that are testing what they sell. (ii) Professional sellers: $39.99 per month. With this plan, you have access to more advanced tools such as API integration, on-site advertising tools or adding multiple users. Besides paying for Amazon plans, you also need to pay for additional selling fees such as referral fees and fulfillment fees: (i) Referral fees: Amazon charges a referral fee starting from 8% per item sold. It is your product category that determines the referral fee rate. (ii) Fulfillment fees: The cost to ship your orders depends on whether you fulfill your own orders or use Fulfillment by Amazon (FBA). If you fulfill your own orders, Amazon only charges if you ship books, music, video, and DVD products. For the FBA service, Amazon calculates the fee based on the size and weight of your pack. Amazon will also charge you storage fees if you use FBA. (iii) Other fees: In certain cases, additional costs may incur. For example, one type of fee that you might have to pay is high-volume listing fees. When you have a high volume of active, non-media listings that have not sold in 12 months, Amazon will charge a monthly fee of $0.005 per eligible listing to cover cataloging costs. 2. Support The Shopify Support hosted solution provides excellent customer support. Like any other eCommerce platform, you can seek help from Shopify experts and other users on its forum, or find the answers for your solutions in Shopify documents and video tutorials. Shopify Changelog is another source to get the latest updates. In addition, you can get 24/7 live support via email, live chat, and phone on Shopify Help Center. The support team will respond to you within a few minutes. Similar to Shopify, Amazon also has a forum for users to post their queries and get support from other users. This platform also has a Help Center that already has many frequently asked questions and answers. If you want to receive support directly from an Amazon customer support agent, they do provide 24/7 support via email, live chat, and phone. 3. Ease of Use Both Shopify and Amazon are straightforward and easy to use. You don’t need to have coding skills to set up a Shopify store with its drag-and-drop design. At first, you need to register a Shopify account. After that, you can manage and modify layout, colors, text, and so on by dropping media elements anywhere on the page. It also has an intuitive interface with visual cues, so you never feel lost when designing your online store. The back-end dashboard of Shopify is also easy to navigate with everything you need displaying on the left sidebar. With Amazon, all you need to do is follow the set-up stages to register a store. After that, you need to upload your products information which includes product category, SKU, product identifier, offer details (price, shipping option, etc), product details (name, brand, etc), and search terms, and then you are ready to sell. While you are selling, Amazon has tools that make it simple and straightforward. For example, you can use FBA to get rid of taking care of the shipping. 4. Design Shopify vs Amazon both provides you with stunning designs. However, when it comes to design flexibility, Shopify gives you more freedom than Amazon. With Shopify, you can choose the design of your store from 81 different themes, including 10 free and 71 paid ones. You can edit and personalize your theme design to create a unique brand image. Shopify users can easily customize the template directly at the front-end by using the theme editor. The theme editor includes a theme preview and a toolbar that you can use to add and remove content, and to make changes to your settings. Another way to edit your store-front design is by using Liquid – Shopify’s Template Language which interacts with the HTML, CSS, and JavaScript of your theme. Unfortunately, Amazon does not allow you to make that much customization on your store-front. All Amazon pages are laid out in a similar way which is recognizably Amazon’s rather than your own. There are only three templates for the product detail page. You can upload your content and images, but cannot change the design. Additionally, on the homepage, your products appear alongside your competitors’ products. Even though this can be convenient for customers, it is very hard for you to direct customers to your stores. 5. Marketing When selling online, marketing is a must for you to reach your potential customers. Shopify provides you with many marketing tools (like Helium 10). Regarding SEO, Shopify offers a basic set of SEO features for users to optimize the store-level content to ensure higher SERP positions. You can edit meta tags, add alt text to images, create 301 redirects and auto XML sitemap, etc. However, users are not allowed to fully customize their URLs. In addition, Shopify also has many impressive features for blogs such as multiple authors, easy-to-set tags, and customizable SEO parameters. Moreover, you can also do email marketing easily with Shopify Email. Just like any email marketing apps, this tool has ready-made email templates and a report generator. It allows you to send up to 2,500 emails to your customers for free. On the other hand, if you sell on Amazon, your potential customers will go to the Amazon site and search for the products that they want. Therefore, instead of Google SEO, you need to focus on Amazon SEO in order to rank as high up the search result pages that you can. In order to do that, you need to optimize your product information content and search terms. Conclusion To truly answer the question of which platform to use in the battle of Amazon vs Shopify, ask yourself: “What do I want from my business and how do I want to sell my products?” If you want complete flexibility and control and are equipped and motivated to market your products and brand to ensure higher profits, then Shopify is the answer. If you prefer to drive sales through a more ‘ready-made’ platform and are happy to relinquish some control in return for higher fees and some restrictions, then Amazon could be the better option for your business. To truly create the successful business you deserve, consider how much time you have available, how much control you require, what effort you are prepared to put in and ultimately how quickly you want your business to grow unrestricted. About Papaya Marketplace Papaya is the largest marketplace connecting suppliers in Latin America with buyers in North America. Today, we have a network of over 5,000 Latin American suppliers serving a variety of consumer goods and product categories in the United States. Papaya marketplace offers buyers a full service experience in the origination, sourcing and managing of products. The platform was founded on the idea that curation and service are the most important elements in the buyer’s journey. Papaya marketplace is building technology that addresses the pains of sourcing products internationally at attractive prices.