In December 2024, Just-Style consulted a panel of industry experts and scholars in its Shape of apparel sourcing in 2025 briefing. Below is my contribution to the report. Welcome any comments and suggestions!
What’s next for apparel sourcing
Although the world economy is predicted to grow at a similar pace in 2025 from 2024, the slowing US and Chinese economies could impose new challenges to apparel sourcing, from weakened demand to intensified price competition.
Regarding the macroeconomic environment in 2025, which “sets the tone” for apparel sourcing, the International Monetary Fund (IMF) and the World Bank estimated that the world economy would grow by approximately 2.7-3.2 percent in 2025, with almost no change from the previous year. Similarly, the World Trade Organization (WTO) projected that world merchandise trade would increase by 3.3 percent in 2025, slightly higher than 2.6 percent in 2024.
Despite this incremental improvement, the world’s two largest economies–the US (with 2.2 percent GDP growth in 2025, down from 2.8 in 2024 and 2.9 in 2023) and China (with 4.5 percent GDP growth in 2025, down from 4.8 in 2024 and 5.2 in 2023) are expected to experience slower economic growth in the new year ahead. This slowdown means that apparel producers around the world, particularly those developing countries making large-volume basic items, will likely continue to struggle with a shortage of souring orders in 2025 due to overall weak import demand.
Even more concerning, as China grapples with declining domestic sales, the world clothing market could see an additional influx of low-cost Chinese products, especially through new e-commerce channels. Notably, less than half of China’s clothing production is exported, indicating its significant untapped export capacity. Furthermore, while China’s wage levels are higher than those in many other Asian apparel-producing countries, the unit price of U.S. apparel imports from China measured in dollar per square meter equivalent ($/SME) dropped by more than 21% between 2018 and 2024 (up to October). In contrast, U.S. apparel import prices from the rest of the world increased by 7.8% over the same period. Related to this, what is often overlooked is that even Shein, the “ultra-fast fashion” retailer known for its exceptionally competitive pricing, deliberately opted out of the vast Chinese market due to concerns about the intense price competition there. In other words, disregarding the new Trump tariff, 2025 could see an escalation of trade tensions targeting Chinese products in the US market and beyond.
Meanwhile, due to concerns about rising geopolitical tensions worldwide and trade policy uncertainty during Trump’s second term, fashion companies will likely continue to leverage sourcing diversification to mitigate risks. However, the “reducing China exposure” and sourcing diversification movement has yet to substantially benefit near-shoring or emerging sourcing destinations such as the Western Hemisphere and Sub-Saharan Africa (SSA). This result was mainly because fashion companies utilized China to source a wide range of various products, whereas Western Hemisphere and SSA suppliers can only produce a few basic categories.
For example, my latest studies show that in the first nine months of 2024, even excluding major platforms like Shein, Amazon, and Temu, US fashion companies sourced more than 60K Stock Keeping Units (SKUs) of clothing items from China. In comparison, India and Vietnam each supplied approximately 15K SKUs, Cambodia and Bangladesh each contributed 3,000 SKUs, Mexico provided only 2K SKUs, and CAFTA-DR and AGOA member countries supplied around 200 SKUs each. Therefore, even if fashion companies report sourcing from more countries, they are likely to stay sourcing from more Asian countries with closer export capacity and structure to China. Meanwhile, the total value or volume of trade may not fully capture the whole picture of sourcing diversification. This trend may persist in 2025, even with new tariff escalations.
Apparel industry challenges and opportunities
Today’s fashion business is highly global and relies heavily on the frequent movement of goods and services across borders. Thus, the uncertain and protectionist nature of U.S. trade policy during Trump’s second term could present significant challenges to the fashion industry in 2025. Of particular concern is that Trump’s new tariff actions would raise fashion companies’ sourcing costs, create additional inflationary pressure, reduce US consumers’ purchasing power on clothing, and trigger retaliatory trade measures from U.S. trading partners, ultimately hurting the U.S. economy. Notably, when the 7.5% Section 301 tariff was imposed on selected Chinese clothing products in 2018, the U.S. Consumer Price Index (CPI) growth was relatively low at 1.9%. However, imposing a 20% global tariff, a 60% tariff on Chinese products, and the existing 15%-30% regular tariff on clothing when the CPI is historically high is like “adding fuel to the fire.”
Besides tariffs, in 2025, if not sooner, U.S. fashion companies and many e-commerce suppliers worldwide will closely watch how Congress and the new Trump administration reform the de minimis rule, which currently exempts small-value shipments under $800 from tariffs and most customs procedures. With Trump’s new tariffs looming, some argue that closing the de minimis “loophole” has become even more urgent, as it creates more financial incentives to use the rule to bypass the tariff increase. Meanwhile, proposals under consideration suggest removing textile and apparel products entirely from de minimis, a move that could be an “earthquake” for those fashion companies utilizing the rule heavily.
Trump’s approach and philosophy toward conventional trade agreements and trade preference programs in 2025 also deserve attention. During his first term, Trump launched a few bilateral trade negotiations, from the one with the United Kingdom and Japan to Kenya. Back then, Trump saw a bilateral agreement would give the U.S. more leverage for a better “deal.” Specifically related to apparel sourcing and trade, two flagship U.S. trade preference programs–the African Growth and Opportunity Act (AGOA) and the Haiti HOPE/HELP Act, will expire in September 2025. It remains uncertain whether the new Trump administration will support the early renewal of these two trade preference programs with minimal changes or prefer to renegotiate them and add new bilateral elements.
Additionally, even though the new Trump administration may not prioritize addressing climate change, it is an irreversible trend for fashion companies to allocate more resources to comply with upcoming or newly implemented sustainability and environmental-related legislation, whether from the EU or the US state level. Unlike in the past, when being more sustainable only meant adding operational costs or paying a “one-time fee,” today’s new generation of sustainability-focused regulations—such as Extended Producer Responsibility (EPR)—requires companies to shift their mindset and demonstrate continuous improvement. Interestingly, my recent study tracking apparel products’ sustainability claims shows that vague terms like “sustainable” and “eco-friendly” are gradually being replaced by more neutral, fact-based keywords such as “regenerative,” “textile waste,” and “low impact.”
Meanwhile, offering “sustainable” apparel products and those using “preferred sustainable fibers” could provide fashion companies new opportunities to diversify their sourcing base and expand their vendor networks. For example, studies show that in the U.S. market, China and many other Asian countries are not necessarily the top suppliers of clothing made with recycled materials. Instead, Europe and countries in the Western Hemisphere or even Africa present unique sourcing advantages and capacities due to the unique nature of such products. Therefore, in 2025, we can expect an ever-closer collaboration between design, product development, merchandising, sourcing, and legal teams within fashion companies, working together to meet the growing demand for sustainable apparel and ensure compliance with evolving regulations.
by Sheng Lu
FASH455 Global Apparel & Textile Trade and Sourcing 
Trump’s second term is going to create a significant change for the fashion and apparel industry. The fashion industry is facing several economic, political, and environmental challenges that are already impacting trade patterns and global sourcing options. Tariffs are increasing 20% globally and raised 60% on Chinese goods on top of existing clothing import costs ranging from 15% to 30%. In our lecture today 3/13, Aine Roberts discussed how fashion brands can mitigate this risk. Fashion brands should navigate this by expanding globally and ensuring a diversified supplier base.
I agree with my peer above. Personally, I feel like we’re seeing the effects of the current administration from a different lens now that we are all older and are more knowledgeable in the ways that their decisions they are making directly affect us as citizens (let alone students). Learning that the WTO has already projected little growth between last year and (what they see happening) this year, is alarming to me, as both the US and China are prominent countries for exports and imports (trading goods), as well as two technologically advanced and competitive countries; the GDP is down in both countries, less than it has been in both 2024 and 2023, showing the effects that this will have on sourcing. Two things that specifically caught my attention within this article was the projection that declining sales will equate to lower costs for Chinese products, as well as what we already know about tariffs that the current administration is imposing. Knowing that tariffs on Chinese goods are being raised to be 60%, while also understanding that this could affect imports (also due to tariffs), shows me that a lot of stuff – like worker exploitation/protection for workers, as well as wages, are all going to still continue to be swept under the rug for the sake of fast production (to appeal to consumer demands). Being able to read articles like this really opens my eyes to the many things that can be affected, simply by changing things, especially within our current government – something that I wasn’t as knowledgeable on prior!
After reading this article, I agree with both of my peers above. With the anticipated economic slowdown in the U.S. and China, global apparel demand will diminish, increasing price competition among international markets. Both the U.S. and China are high traffic countries for imports and exports and are highly competitive towards one another. There is projected to be very little growth for the U.S. as the introduction of new U.S. tariffs and trade policies, such as the de minimis rule could escalate trade tensions and disrupt established supply chains. Tariffs on Chinese goods are significantly being raised by over 50% , likely increasing worker exploitation and lower wages. Brands that are proactively adapting to these practices by leveraging technological changes and substantial practices will be better positioned to steer rising uncertainties.
This blog post caused me to take a bit of a different look at everything regarding the current changes in the world. Instead of looking at brands’ tariff responses, I started thinking about the missed opportunities. Most brands continue to focus on China’s dominance in product variety and pricing but are overlooking the greater potential in developing sourcing strategies that prioritize innovation and sustainability for the future. Potential exists for recycled cotton apparel production in Egypt, Morocco, and Tunisia according to the article but I believe these countries need more attention. Brands should use the current period of uncertainty to completely redesign their sourcing strategies. Growing consumer and regulatory demand for sustainable materials make early investments in regions specializing in recycled or low-impact textiles a source of real long-term value. Although these regions cannot immediately take China’s place as a major source they should not be overlooked. Businesses concentrating exclusively on diversifying their production volume will likely fall behind in under five years if they ignore capability growth and innovation investment. Sourcing strategies in the future will depend not only on location but also on purpose.
This blog post discussed key challenges and opportunities for apparel sourcing in 2025. Its predictions align closely with current industry trends, particularly regarding diversification and sustainability. Fashion companies are actively reducing their reliance on China by exploring alternative sourcing regions like Vietnam, India, and Mexico. However, there are still challenges that come with this, as these countries often lack the production capacity and variety that China has. Sustainability has definitely become a main focus with many brands working on meeting consumer demand for eco-friendly products. They are also aligning with stricter environmental regulations. As these trends continue, companies will have to balance cost-efficiency with environmental responsibility, likely reshaping future sourcing strategies.
Outlook 2025 states that apparel sourcing is being impacted as much by politics as economics. The proposed 60% tariff on Chinese apparel, on top of existing tariffs, enacted at a time of high inflation, seems more a political action with global consequences than a strategy to revive manufacturing in the United States. These types of aggressive trade measures raise consumer prices, destabilize global supply chains, and have a tendency to harm workers on both sides. If the U.S. is interested in strengthening its domestic apparel sector, the focus must be on ethical reshoring, green manufacturing assistance, and promoting innovation; not provoking trade wars that lead to retaliation and additional costs across the board.
I am also worried about the uncertain fate of trade preference schemes such as AGOA and the HOPE/HELP Acts. These arrangements are not just trade instruments; they are critical to the livelihoods of workers in developing countries, many of whom are women employed in garment factories that depend on duty-free access to U.S. markets. Allowing these programs to expire, defeats the ideals of fair trade and global development.
Hi Antonina! I really liked how you broke down the political side of what’s going on in apparel sourcing right now. That proposed 60% tariff on Chinese apparel feels more like a power move than a real plan to bring back U.S. manufacturing, and like you said, it’s regular people and workers on both sides who end up hurt. I also thought your point about reshoring was spot on. If we actually want to rebuild the U.S. apparel industry, we need to invest in ethical and sustainable manufacturing—not start trade wars. And I totally agree with you on the importance of trade preference programs like AGOA and the HOPE/HELP Acts. So many workers, especially women, rely on those opportunities, and letting them expire would be a huge step backward for fair trade and global progress.
With the planned 60% Chinese import tariffs, a step up from the current 15% to 30% import levies on clothing, Trump’s possible second term has a lot in store for the fashion and apparel sector. Fashion businesses have to increase their global sourcing plan and diversify suppliers in an effort to manage this volatility, as Aine Roberts talked about in a previous lecture. Sustainability and resilience are also critical drivers over cost. China and the United States are both seeing lower GDP growth, as Gabrielle highlighted, which is indicative of more serious structural problems with international trade. New trade rules, such as modifications to the de minimis rule, may further upset supply chains, Kasey continued, forcing pressure on worker wages and fair labor practices. Emma, however, correctly implied that businesses need to invest in new, sustainable sourcing in Egypt, Morocco, and Tunisia rather than being stuck in China’s hold. Both Riangiunta and Antonina stressed that diversity in and of itself is insufficient; in a bid to remain competitive, companies should also consider ethical reshoring, equitable trade practices, and environmental responsibility. All things considered, fashion stands at the crossroads, and those who change now with careful, visionary sourcing practices will be well placed to contend with the challenges of the future.
It is interesting reading this article almost halfway through 2025 because I am able to see if any of these predictions or trends are starting to occur. For example, the post discusses how due to uncertainty about Trump’s tariffs, many fashion brands will begin to diversify their supply chains in order to mitigate risks, and this has been happening already this year. The heavy tariffs on China have caused many brands to consider where they can move some of their supply chain in order to work around increased costs. Many brands are moving some sourcing to other Asian countries that have the most capability of manufacturing as well and as much as China can. I also found the last paragraph about sustainability interesting, especially the idea that manufacturing sustainable or recycled products could be a good opportunity for Western Hemisphere or African countries. The issue that many fashion brands have when sourcing from these places is that they are not equipped to produce more complex garments like many Asian countries are, so focusing on manufacturing sustainable garments instead may be a good niche for these countries and may attract sourcing interest from brands that focus on sustainability.
Honestly, this comment is almost more fascinating to me than the original blog post. My peer discussing the predictions of the tariffs from just a few months ago and now seeing how it has all played out is so interesting. Firstly, the tariffs did cause supply chains to diversify and change location to where there have been fewer tariffs. Also, many brands have begun to take their sourcing and supply chains out of China due to this. And as we learned in class, they have migrated to Vietnam and other countries with lower tariffs.
I think this is an extremely insightful and important look on the increasing complexity of current apparel sourcing. Unfortunately, under Trump’s second term, there are lots of concerns regarding his aggressive tariffs. There are so many issues these tariffs are causing. A main concern for consumers is definitely higher costs for items, as that is the number one thing people think of when they hear the word “tariffs.” However, I think another big side of this is the affect on international trade relations. Trade with other countries is a huge part of everyday life, and without this we would only have products made in the U.S., causing a vast lack of diversity. This also causes issues for e-commerce brands and retailers, as it increases shipping costs and some smaller companies may not be able to afford this. I am fearful for the future with these tariffs, as I believe both prices and trade relations will continue to get worse.
This article highlights how the apparel industry is entering a critical turning point in 2025. What stood out most to me was the tension between companies wanting to diversify their sourcing away from China while still heavily relying on it due to its unmatched manufacturing capacity. I also found it interesting how growing trade restrictions and sustainability regulations are forcing brands to rethink their sourcing strategies and prioritize supply chain transparency. As someone interested in fashion wholesale and sourcing, this article reinforced how important it is to stay adaptable and aware of global shifts that directly impact product availability, cost, and compliance.
After reading this article, I was reminded of the demand of sustainable products. More consumers seem to take a closer look into what goes in to their products and what that products impact on the environment may be. It’s important now for consumers to buy products that last long. With this in mind sourcing from China, is not the best possible solution for brands that value sustainable efforts. The article goes on to talk about how there are more countries that the United States can source from, that holds a higher sustainable standard than that of Chinese suppliers. With the trade war possibly scaring off some companies, it might be a perfect opputunbity to invest in other developing countries that specialize in higher quality, and sustainable garment creations.
I agree that this report details the realities the apparel industry is heading into, specifically for 2025, with the U.S. and Chinese economies slowing. Logically, weak demand and tighter price competition would still impact sourcing, particularly for countries reliant on large-volume basics. I also agreed with the point that even though brands say they are “diversifying,” most of that shift is still staying within Asia because no other region can match China’s scale or product variety. The concerns about new tariffs and changes to the de minimis rule also seemed quite realistic to me, since both would raise costs and further complicate sourcing for fashion firms.
This piece draws a sharp link between macro forecasts and sourcing reality. Slower demand in both the US and China means weaker orders for basic apparel. Many suppliers face another year of tight margins and fierce price pressure.
The SKU data on China versus other regions stands out. It shows that “diversification” in company reports often means shifting within Asia rather than a broad reset toward the Western Hemisphere or SSA. Counting products, not only value, gives a much clearer view of how hard it is to replace China’s breadth.
The trade policy section feels urgent. A 20% global tariff and 60% on China layered on top of existing clothing duties during a period of high CPI means higher costs, weaker purchasing power, and real risk of retaliation. The de minimis debate and the future of AGOA and Haiti HOPE/HELP add more uncertainty for vendors that already operate on thin margins.
I also like the link you draw between sustainability rules and sourcing strategy. New, more concrete claims such as “regenerative” or “textile waste” push brands toward new suppliers that have real capabilities, not just marketing language. That shift creates space for Europe, the Western Hemisphere, and even parts of Africa to grow in 2025, especially if brands break silos and let design, sourcing, and legal teams plan together from the start.
Thank you for sharing such a comprehensive analysis for 2025. The point about slower economic growth in both the U.S. and China creating weaker demand and intensifying price competition stood out to me. The idea that fashion companies may continue to “diversify sourcing” as a hedge against trade policy volatility makes a lot of sense, but the article also highlights a harder truth: many alternative sourcing regions still can’t match China’s capacity or breadth.
I also like how the article flags sustainability and regulatory pressure as real drivers of change, not just marketing buzzwords. As someone studying merchandising and sourcing, this shows me why sourcing strategy now needs to balance cost, flexibility, compliance and increasingly even ethical and environmental factors.
Reflecting now at the end of the year, it’s interesting to see how accurate many of these predictions were. We did see brands push harder into sourcing diversification, even if China remained central. Economic uncertainty absolutely shaped buying volumes, and sustainability regulations tightened faster than many expected. Overall, Dr. Lu’s insights proved to be a very realistic preview of the challenges and shifts we actually saw throughout the year.