2015 US Fashion Industry Benchmarking Study Released

[Note: The 2016 U.S. Fashion Industry Benchmarking Study has been released]

UntitledThe U.S. Fashion Industry Association (USFIA) released its 2015 benchmarking study today. The report examines the industry’s business environment and outlook, sourcing practices as well as U.S. fashion companies’ viewpoints on critical trade policy agendas. Among the key findings:

  • Overall, respondents remain optimistic about the five-year outlook for the U.S. fashion industry. Like last year, they are most concerned about increasing production or sourcing costs, but they expect increases to be more modest this year.
  • Consistent with our 2014 findings, U.S. fashion companies are NOT moving away from China, and Bangladesh remains a popular sourcing destination with high growth potential, though not quite as high as last year.
  • Companies continue to diversify their sourcing, though free trade agreements (FTAs) and preference programs remain underutilized.
  • The U.S. fashion industry is a critical Trans-Pacific Partnership (TPP) stakeholder, as close to 80 percent of respondents expect implementation will impact their business practices. However, the restrictive rules in the agreement limit the potential.
  • U.S. fashion companies continue to express interest in expanding sourcing in the United States in the next two years as they further diversify their sourcing. However, there is no evidence that companies are shifting their business models back to manufacturing.

This benchmarking study was based on a survey of 30 executives at the leading U.S. fashion companies from March 2015 to April 2015. The findings well reflect the views of the most influential players in the U.S. fashion industry, with 90 percent of respondents having more than 100 employees (including 60 percent with more than 1,000 employees).

The full report can be downloaded from HERE.

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Author: Sheng Lu

Professor @ University of Delaware

10 thoughts on “2015 US Fashion Industry Benchmarking Study Released”

  1. As stated above, the U.S. has no intention of pulling out of China or Bangladesh anytime soon. Our relationship with these two countries are what keeps the U.S. afloat, as well as theirs. There is no emphasis on any companies in the U.S. transitioning back into manufacturing locally. What used to be thriving mills, making beautiful garments and or materials, are now old abandoned mills that are being transformed into office parks and apartments. This study clearly shows that no company has any intent to begin manufacturing in these mills again. The U.S. main focus is importing and saving money. These companies care about the bottom line and very little about the growth of the U.S.’s economy or bringing jobs back to the U.S.

  2. As important as bringing production back to the US could be for our economy. The fashion industry does not seem to want to budge. The relationships which are already forged with countries like China and Bangladesh are so well constructed after years of trade that it would be more difficult to move production and start up a new relationship with another factory locally. The industry is focused on productivity and price, that is all. So until there is a financially wise solution to move production I do not think production will actually transition to being a global opportunity.

  3. I am not surprised that the US is still using China and Bangladesh as sourcing destinations, but when is our own country going to be one of our top sourcing destinations? It is definitely of high interest among many fashion companies, but it doesn’t mean that we can pull out of China or Bangladesh completely because they can provide us with products in large amounts at smaller costs than we would be able to within our own country. The US clearing wants to continue importing, but I question whether we will ever be a top sourcing destination for ourselves.

  4. Fast fashion is what keeps the majority of the fashion industry in business. For everyday people, companies that are able to produce hot trends and have them on the shelf days after major fashion shows are the “go to” place. They outsource to countries like China and Bangladesh and rely on them to produce clothing in a matter of days in order to satisfy the high demand that comes from the United States. This also applies with other industries, which is why America has no plans of steering away from relationships with both China and Bangladesh. They are a huge factor in production for US corporations.

  5. I don’t think we’re ever going to see the U.S. pulling manufacturing sites out of Bangladesh or China in our lifetimes. It’s going to take a lot of work for the United States to be able to accomplish this. Until the US can start manufacturing more efficiently at lower prices than the already unethical pays of the workers in Bangladesh, which no American would ever stand for, we are still going to manufacture textiles and apparel globally. Retailers take years to perfect their relationships with manufacturers across seas and this would be the same for retailers in the U.S. finding manufacturers in close proximities. As for now, this is the method that works best and until companies start taking the challenge of producing within the same country its going to remain this way. I found this report to be very interesting because it shows up-to-date statistics, showcasing more countries than just the U.S. Glad to have a professor so passionate and hands-on in these everyday obstacles the fashion industry faces.

    1. thank you for the comment! I feel very honored to get involved in this meaningful project and it is a great learning opportunity for me as well! one key takeaway from the study is US fashion companies are truly global in operation–produce anywhere in the world and sell anywhere in the world. we find us fashion companies like to source more “made in USA” products in the next 2 years, but at the same time, they are not going to reduce sourcing from elsewhere. this implies that sourcing has become an integral part of these companies’ overall business strategy. later this semester we will do an in-depth case study on VF, hopefully it will offer you more insights into the apparel sourcing practices today.

  6. Because of fast fashion, the fashion industry continues to use Bangladesh and China as it’s main sourcing destination, meaning that the fashion industry has not really changed at all in the recent years. A few years ago Ralph Lauren created the uniforms for the USA Winter Olympics team. though later on people were told that Lauren still used a sort of sourcing from other countries. This makes me think is there any way to even bring back manufacturing in the USA or will be always be known as the country who was once a great manufacturer but might never be again. In the statistics above, they show that over decades the USA has become powerful allies with many sourcing countries, building up strong relationships with them. Because of this and the scarce resources that we as a country don’t have in relation to manufacturing, we will continue to source out with China and Bangladesh. And even if we do find a way to start manufacturing, they might support our cause and want to help us since we help them. Finally, the USA may even try to expand the globalization to other countries to get them more involved and bring their culture into ours like the statistics say above.

  7. I am not surprised to find that US fashion companies are not moving away from sourcing outside of the US. It is less expensive to source in countries such as China or Bangladesh, so fashion companies have little incentive to move their sourcing back to the US. In fact, I thought potential growth of sourcing in countries such as Bangladesh would continue to rise, and was surprised to learn growth this year was not as high as last year. Furthermore, I did not expect to find that US fashion companies are expressing interest in expanding sourcing in the US. I do not believe companies will follow through with moving sourcing to the US, they are simply saying this to seem as though they are concerned with what is currently a controversial topic.

  8. I don’t not believe we will ever be able to get all of our products made only in the US. We have worked hard to gain relationships like we have in China and Bangladesh for many years. The fashion industry worked hard on their trading policies and relationships with other countries that they would want to focus on the fast pace productivity and lower prices. I wish to believe we will have few companies come to the United States to help our economy but at the same time keep relationships with other countries overseas. We will learn about their culture and work together as a team. If the United States were able to compare to the low prices overseas maybe we would see move of a change but at this time companies are to focused on the price and not worrying about keeping their goods domestic. Retailers take years to gain their relationships with manufacturers across seas and this would be the same for retailers in the U.S. finding manufacturers domestically.

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