This apparel sourcing glossary explains the terms fashion brands, importers and wholesalers meet most often when producing in Bangladesh — from pricing and Incoterms to quality standards and compliance. Milky Fashions is a BGBA-registered garment buying house that has sourced for European brands since 2002; these are the definitions we use with buyers every day.
Commercial & Pricing Terms
MOQ (Minimum Order Quantity)
The smallest quantity a factory will produce per style or colourway, set to cover its setup costs. Larger MOQs lower the unit price; test orders and startups need a low MOQ clothing manufacturer. Typical Bangladesh MOQs run 300–1,000 pieces per style, though development-led suppliers accept less.
FOB (Free On Board)
The supplier’s price covers production and delivery to the port of shipment, loaded onto the vessel; the buyer then pays freight, insurance and import duties. FOB is the most common Incoterm in apparel because it splits cost and risk clearly between the two parties.
CIF & CFR
Under CIF (Cost, Insurance, Freight) the supplier’s price also covers sea freight and insurance to the destination port; CFR (Cost and Freight) is the same without insurance. Both are convenient but can hide freight margins, so many buyers prefer FOB and arrange their own logistics.
EXW (Ex Works)
The buyer collects goods from the factory gate and bears all cost and risk from that point onward. It gives maximum control but demands strong in-country logistics, so it is uncommon for brands sourcing remotely.
DDP & DAP
DDP (Delivered Duty Paid) puts freight, insurance and import duties on the supplier until goods reach the buyer’s door. DAP (Delivered At Place) is similar, but the buyer clears customs and pays duty. Both simplify buying while raising the quoted price.
LC & TT (Payment Terms)
An LC (Letter of Credit) is a bank guarantee that pays the supplier once shipping documents meet agreed terms — secure but paperwork-heavy. A TT (Telegraphic Transfer) is a direct bank transfer, often split into a deposit and balance. Payment terms strongly affect a supplier’s willingness to take an order.
Product Development & Production
Tech Pack
The technical specification of a garment: measurements, construction, materials, trims, artwork and tolerances. It is the single most important document a buyer provides — without it, factories cannot quote accurately. Our sourcing team can help brands build one from a sketch.
Sampling
The approval process before bulk: a proto (proof of concept), then a fit sample, then a PP (pre-production) sample approved before the line runs, and finally a TOP (top-of-production) sample from the actual run. Each stage reduces bulk risk.
Lead Time
The total time from order confirmation to shipment, covering material sourcing, sampling, production and inspection. Bangladesh knitwear typically runs 60–90 days; woven and complex outerwear longer. Fabric availability is the most common driver of delay.
Grading & Consumption
Grading scales a base-size pattern up and down the size range. Consumption is the calculated fabric required per garment and the foundation of accurate costing. Errors in consumption are a frequent cause of price disputes.
Quality & Compliance
AQL (Acceptable Quality Limit)
The statistical standard (ISO 2859 / ANSI Z1.4) that decides whether a shipment passes inspection. A sample is drawn from the lot and defects are counted as critical, major or minor. A common apparel level is 2.5 for majors and 4.0 for minors, with zero tolerance for critical defects.
BSCI, WRAP & SEDEX
The leading social-compliance audit schemes that verify labour conditions, safety and ethics inside a factory. European buyers increasingly require at least one. Milky Fashions works only through certified factories.
GOTS, GRS & OEKO-TEX
GOTS certifies organic textiles end to end; GRS verifies recycled content and chain of custody; OEKO-TEX Standard 100 confirms a product is free of harmful substances. These material certifications underpin credible sustainable sourcing claims.
EU Due Diligence (CSDDD & LkSG)
New EU rules — the CSDDD and Germany’s LkSG — require brands to identify and address human-rights and environmental risks in their supply chains. Buyers now expect suppliers to support this with documentation. See our EU supply chain compliance overview.
Types of Sourcing Partner
Buying House
Maintains a permanent office, a merchandising and QC team, and long-term factory relationships, managing a buyer’s order end to end across categories. See our guide to a garment buying house in Bangladesh.
Sourcing Agent
An apparel sourcing agent represents the buyer’s interests on the ground — vetting factories, negotiating and overseeing sampling, compliance and QC — usually for a transparent commission rather than a hidden margin.
OEM & ODM
An OEM (Original Equipment Manufacturer) produces to the buyer’s own designs and specifications. An ODM (Original Design Manufacturer) offers ready designs the buyer can brand. See our OEM apparel supplier page.
Private Label & White Label
Private label means garments made to your brand and specification and sold under your own label. White label is a generic product rebranded by multiple sellers. Most fashion brands want private label clothing for differentiation.
Work With a Buying House That Speaks Your Language
Understanding these terms shortens negotiations and prevents the miscommunication behind most costing and quality disputes. If you are planning production in Bangladesh and want a partner to manage the whole process, talk to Milky Fashions.