top of page

Vertically Integrated Factories in Backpack Manufacturing: An In-depth Look

Updated: Jun 19

vertically integrated backpack manufacturing


In manufacturing, many turn to Alibaba for quotes without proper knowledge, leading to unpredictable pricing.

Just like buying a house or car, starting a garment business requires thorough research.

Our $100 consultancy package provides an unbiased, industry-grade quote, matched factories, a consultation call, and more, ensuring you’re well-prepared and saving you from common pitfalls.

With 15 years of experience, we offer the expertise you need to confidently take your brand forward. Contact us to get started!


Thank you for taking the time to read our blog! We hope you found it informative and inspiring. If you have a backpack manufacturing idea and are eager to bring it to life, we’d love to help. Reach out to us at, and let’s get started on your journey.

For those who want to dive deeper, our consulting calls start at just $100 USD per hour. We’ll give you a detailed breakdown of your idea, teach you how to leverage minimum order quantities, negotiate pricing, and introduce you to top-notch factories. Don’t wait—let’s turn your vision into reality! Get in touch

When it comes to backpack manufacturing, the landscape is incredibly diverse, encompassing everything from small workshops to sprawling industrial complexes. The nature of these factories can vary significantly, especially in terms of vertical integration—the extent to which a company owns its supply chain and production processes. Understanding the dynamics of vertically integrated factories and how they differ from less integrated ones is crucial for anyone looking to source or manufacture bags, whether they are backpacks, rucksacks, or custom designs.

Understanding Vertical Integration

Vertical integration refers to a company’s control over multiple stages of its production process, from raw materials to finished products. In the context of backpack manufacturing, this means that a factory might handle everything from sourcing raw materials, such as nylon or leather, to cutting, sewing, printing, and finishing the backpacks in-house.

Types of Factories: Big vs. Small

1. Large Factories:

Capabilities: Large factories often have a wide array of capabilities in-house. They might perform printing, waterproofing, and specialized stitching without needing to outsource. For example, a major backpack manufacturer that produces for brands like JanSport will likely have extensive facilities and thousands of employees to manage high-volume production runs efficiently.

Advantages: The ability to keep most processes under one roof can lead to better quality control, faster turnaround times, and more consistent product quality. These factories also tend to have stronger relationships with material suppliers, which can sometimes translate to better pricing and priority access to high-quality materials.

Disadvantages: However, this level of integration and capability doesn’t necessarily mean lower costs. The overheads associated with maintaining large facilities and a sizable workforce can be substantial. Additionally, large factories might not be interested in low Minimum Order Quantities (MOQs), making them less accessible to smaller brands or startups.

2. Small Factories:

Capabilities: Smaller factories, on the other hand, might have to outsource several stages of the production process. A small bag factory specializing in custom designs might send materials out for waterproofing or printing, especially if these processes require specialized equipment they don’t possess.

Advantages: These factories can be more flexible and willing to take on smaller orders, which is ideal for emerging brands. They might also offer more personalized service and be more adaptable to unique or custom designs.

Disadvantages: Relying on external vendors for certain processes can introduce variability in quality and lead times. It can also complicate logistics and increase the risk of miscommunication or delays.

Key Processes in Backpack Manufacturing

1. Printing:

In-House vs. Outsourced: Factories with in-house printing capabilities can ensure better alignment with design specifications and faster iteration times. Outsourcing printing can save on initial investment costs but may lead to longer production times and potential quality discrepancies.

Example: A factory specializing in custom backpack manufacturing may need to outsource screen printing for complex designs, while a vertically integrated bag factory handling high volumes might have state-of-the-art digital printing technology on-site.

2. Waterproofing:

In-House vs. Outsourced: Waterproofing processes such as applying DWR (Durable Water Repellent) coatings or seam-sealing can be done in-house or by specialized subcontractors. Factories that handle this in-house can offer more consistent product performance.

Example: A factory producing for outdoor brands will likely have robust waterproofing capabilities, ensuring that every rucksack meets stringent weatherproof standards.

3. Material Handling:

In-House vs. Outsourced: The type of materials used (e.g., nylon, leather, recycled plastic) significantly impacts whether a factory can handle production internally. Factories specializing in synthetic materials may not have the expertise or equipment for working with leather, necessitating outsourcing.

Example: A factory in Quanzhou, a hub for nylon bag manufacturing, might need to send leather materials to a different facility equipped to handle leather tanning and finishing.

Influence of Location and External Factors

Proximity to Suppliers: Factories located near material suppliers, such as those in Fujian province close to textile mills, can benefit from reduced transportation costs and quicker supply chain turnaround.

Labor Quality: Regions with a skilled labor force in textile manufacturing, like Quanzhou, often produce higher-quality products. Conversely, areas with cheaper but less skilled labor might produce lower-quality goods.

Weather: Climatic conditions can affect production. For instance, high humidity levels can impact material properties and storage conditions. Factories in regions with stable climates may have fewer production delays due to weather-related issues.

Economic and Governmental Influences

Government Subsidies: Some regions benefit from government subsidies aimed at boosting manufacturing sectors. These subsidies can help factories invest in better technology and training, enhancing their competitiveness.

Historical Significance: Quanzhou’s historical role as a major port on the ancient Silk Road has entrenched it as a manufacturing hub. Its established infrastructure and trading networks provide a robust foundation for modern-day backpack manufacturers.

Pros and Cons of Vertical Integration





Potential savings from bulk buying and reduced outsourcing costs

High overheads and initial capital investment

Quality Control

Consistent quality and faster troubleshooting

Potentially higher costs if internal processes are inefficient


Easier to manage production schedules and adapt to changes

Less flexibility in shifting to new materials or processes without retooling

Supplier Relationships

Stronger relationships can lead to better pricing and priority access

Risk of complacency and lack of innovation if too reliant on in-house processes


The choice between using a large, vertically integrated factory or a smaller, more specialized one depends on several factors, including order size, desired quality, and specific production needs. Understanding the capabilities and limitations of different types of factories helps in making informed decisions that align with your brand's goals and quality standards.

For brands seeking a reliable backpack manufacturer or rucksack manufacturer, evaluating the level of vertical integration and the factory's location, capabilities, and supplier relationships is crucial. Whether you are working with a high-volume bag factory or a niche custom backpack manufacturer, each choice brings its own set of advantages and challenges.


  1. "The Rise of China as a Global Manufacturing Powerhouse." World Economic Forum. Accessed June 12, 2024.

  2. "Textile and Apparel Manufacturing in China." Textile Today. Accessed June 12, 2024.

  3. "Understanding Vertical Integration in Manufacturing." Harvard Business Review. Accessed June 12, 2024.

By understanding these dynamics, businesses can better navigate the complex world of bag manufacturing and find the best partners to bring their designs to life.


bottom of page