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United States are eager to increase their apparel sourcing from Bangladesh

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apparelOver the next two years, fashion firms and buyers in the United States are eager to increase their  sourcing from Bangladesh. They discover that Bangladeshi garment and textile prices are lower than the global average. According to the United States Fashion Industry Association’s “2021 Fashion Industry Benchmarking Study,” the unit price of garment products in Bangladesh was $2.5 in July-May this year, while the global average price was $2.6. ‘As in previous years, respondents this year indicate Bangladesh offers the most competitive price, followed by China, Vietnam, Indonesia, India, and Cambodia,’ according to the USFIA. Despite the fact that China has lower prices than Bangladesh, US purchasers seek to diversify their sourcing away from China and Vietnam to prevent putting all of their eggs in one basket and to reduce various sourcing risks. During the pandemic, the US-China trade battle has intensified sourcing cost concerns and financial challenges for US fashion companies. Because of the tariff war, US fashion companies will have to pay an average import duty rate of 23.4 percent for apparel imports from China in 2020, up from 16.5 percent in 2017.

Improving manufacturing flexibility and agility as well as diversifying the export product structure will be crucial for Bangladesh if it wants to play a more major role as an apparel sourcing base for US fashion businesses in the post-Covid world As a result of this rising trend, the competition among the thousands of Bangladeshi clothing suppliers is expected to increase. More sourcing orders will help competitive suppliers, but smaller and less competitive ones may be at risk. Bangladesh, China, Vietnam, Indonesia, India, and Cambodia are regarded to offer the most competitive prices.

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