Experts from the US fashion industry have predicted overseas apparel sourcing to dip in the near future, in part as a result of consumer confidence waning as inflation soars. But with the attention of apparel brands and retailers shifting from China when it comes to sourcing, there are some big opportunities for other apparel producer majors – particularly ones positioned closer to home turf.

The USFIA Benchmarking Study published last week revealed diversification from China as top of mind for most apparel industry execs as concerns continue to grow over Beijing’s position on human rights, particularly in regard to Xinjiang. The launch of the Uyghur Forced Labour Prevention Act and its requirements mean the need for US sourcing executives to reduce China sourcing is becoming more apparent.

The latest USFIA survey indicates in most cases China is no longer the largest source of apparel imports for many US fashion companies regarding sourcing value or volume.

And that proves advantageous to producer countries more closely located to the US. Ones that are members of the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) are being favoured.

Over 80% of respondents to the survey said they were sourcing from CAFTA-DR members in 2023, up from 60% in the past few years and 30% of respondents said they placed more than 10% of their sourcing orders with CAFTA-DR members this year compared with 19% of respondents in 2022.

And this shift is likely to become more apparent as the US government doubles down on efforts to move away from low-cost supply chains in a bid to prioritise the needs of US workers and producers.

The Biden-Harris Administration is now pioneering new trade agreements with partners in the Indo-Pacific region and Latin America. It will facilitate access to foreign markets for US workers and producers.

Katherine Tai of the US Trade Representative Office said the policies will seek to promote vertical integration and empower developing countries to break free from exploitative cycles as previous policies inadvertently encouraged a “race to the bottom,” where countries competed by lowering standards to attract business, leading to a concentration of production in a single economy, notably China.

By Just Style