The latest statistics from inventory management software provider Unleashed suggests a ‘shaky start’ to the year for UK fashion suppliers with a decline in sales and procurement activities as well as growing lead times.

The results of Unleashed’s Manufacturing Health Index report for Q4 2024 has come in against a backdrop of market volatility and changes to international tariffs that have led to uncertainty among those responsible for making strategic decisions.

The report is released on a quarterly basis and aggregates data concerning purchases, sales, and inventory fluctuations among small and medium-sized manufacturing enterprises throughout the UK.

Manufacturing performance data in the fashion industry shows that small to mid-sized companies saw their average sales revenue decline 32.78% to £352,000 ($449,000) in Q4 2024 from nearly £524,000 in the third quarter of 2024.

Concurrently, the number of purchase orders declined by half, dropping 49.49% from 790 in Q3 of 2024 to 399 in Q4.

Lead times increased marginally on a quarterly basis from 23 days to 25 but declined 34.2% from 38 days in the same period the prior fiscal.

The analysis also showed that sales revenues had fallen by nearly 3% compared to the same timeframe in the prior year with purchase orders decreasing by more than 8%.

This data emerged alongside other statistics showing a decline in confidence among retailers and wholesalers to a two-year low, influenced by escalating taxes and stagnant sales growth. 

Unleashed examined 12 manufacturing categories for its latest Manufacturing Health Index Report.

The study revealed a sector-wide decline in average sales revenue of over 40% in the last quarter, from £468,215 to £275,953.

The frequency of purchase orders also saw a nearly halved rate, falling from 322 to 167. When compared year-over-year, sales revenues had diminished by roughly 22%, and purchase orders by close to 18%.

Unleashed parent company The Access Group small business ERP GM Joe Llewellyn said: “Low consumer confidence and newly-volatile international trading conditions seem to be taking their toll on manufacturers across almost every category we looked at – which made it a tough start to the year for many businesses.

“While many will be rightly concerned about this drop-off, it’s worth bearing in mind that Q3 2024 was a bumper quarter, when we saw both sales revenue and POs surge. That suggests performance is returning to more normal levels, albeit a little more subdued than we’d all like to see.

“The figures also suggest that manufacturers are keeping a tight rein on their inventory, with excess stock significantly down, and a corresponding rise in its profitability (GMROI). While market conditions have impacted sales and orders, they’re controlling what they can, enabling them to weather the storm and make the most of the recovery.

“Finally, it’s reassuring that total sales for the year were up compared to 2023, showing an overall more positive direction of travel.”