According to a new report by the US Fashion Industry Association and Sheng Lu, an associate professor of fashion and apparel studies at the University of Delaware a record number of US fashion companies no longer list China as their top supplier.
It was the result of growing diplomatic uncertainty and concerns about forced labor. The survey reveals about 61 percent of retail heads have stopped using China as their primary supplier. Before the pandemic, China’s avoidance was 30 percent. In fact, 80 percent of brands plan to reduce sourcing from China in the next two years. The brands are leaving China for Vietnam, Bangladesh, and India.
The China issue is one of the few issues that unite both Republicans and DemocratsBreaking up with China is easier said than done for American fashion retailers, which for decades have relied on the region for efficient and low-cost production. China also has machinery and a skilled workforce that can produce certain stitches, fabrics, and styles that are hard to find in other garment-producing countries..
Impetus this year for retailers to find a supplier base elsewhere accelerated weakening US-China relations, as well as the enforcement of the Uyghur Forced Labor Prevention Act. Cotton products have been of particular concern because Xinjiang is one of China’s largest cotton-producing regions. Managing forced-labor risks in the supply chain ranked as the second-largest business challenge in 2023, following inflation and the economic outlook.
The US apparel imports from China fell to 18.3 percent in the first five months of this year, compared with 30 percent in 2019, according to the report. The US apparel imports from the five largest Asian suppliers Vietnam, Bangladesh, Indonesia, India, and Cambodia increased by 44.3 percent over that same period.
Apparently, US apparel companies are not pursuing domestic production, many are near shoring. Mexico, Guatemala, and Nicaragua made it into the list of top 10 fashion suppliers this year, the report showed.
