In Jeans Sourcing, the Mighty are Falling and the Upstarts are Rising

12 Feb 2020 10:46 AM
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The balance of power in denim jeans manufacturing took a dramatic turn in 2019, resulting in a decline in volume and value for the top three suppliers-China, Mexico and Bangladesh-and strong upswings for another three-Vietnam, Pakistan and Egypt.
 
The reason why and issues are various, executives have said, which range from the U.S.-China trade war, rising costs and unstable monetary and labor circumstances, to capacity construction, experience and quality.

U.S. imports of blue denim apparel, 97 percent which are jeans, from leading volume distributor China plummeted 25.87 percent in volume to 7.28 million dozen in 2019, while similarly falling 25.68 percent in value to $696.55 million.

The overriding theme in sourcing today is diversification to limit risk. Nesli Danisman, president of Angora Group, a strategic merchandise management consulting firm, said at the recent Texworld USA show that the trade battle has resulted in the business “being more open-minded and nimble, and also less focused on our basic of factories.”

“It’s been about taking more trips, seeing what’s out now there and having more alternatives up for grabs for different product groups and different areas,” Danisman said. “We’ve actually been construction our database. That’s because we use some brands that will be in China and desire to diversity and shift some of their production base.”

Mexico, the No. 1 supplier in value conditions, found its shipments to the U.S. dip 1.84 percent to $802.55 million for the entire year. Volume level from Mexico in 2019 fell 6.78 percent to 71.60 million dozen in the 12 months.

It was more of a mixed but unimpressive effectiveness from Bangladesh, which posted a 3.5 percent increase in value to $585.92 million in the entire year, but saw volume fall 2.49 percent to 72.08 million dozen.

In a year that found U.S. jeans imports decline 3.16 percent to $3.73 billion-clearly attributable in great component to retailer closings and overall retail malaise-the gains made by Vietnam, Pakistan and Egypt were notable.

Jeans imports from Vietnam jumped 25.6 percent in value to $372.34 million in 2019. In volume, the country delivered 28.62 percent more merchandise for the entire year to attain 3.69 million dozen.

With strong vertical developing structures, Pakistan and Egypt both solidified their positions as important denim apparel suppliers. Imports from Pakistan rose 8.69 percent in volume to 2.85 million dozen, while increasing 5.13 percent in value to $259.10 million. Imports from Egypt rose 12.7 percent in value to $173.76 million and heightened 8.96 percent in volume to at least one 1.51 million dozen.

Nicaragua and Cambodia both posted substantial raises in benefit for the entire year, while volume dipped, meaning the countries were building more costly jeans for U.S. consumption, taking organization from major manufacturing neighbors.

In the case of Nicaragua, companies have reported going business out of Mexico to achieve the same Western Hemisphere logistical advantages at lower costs. Imports from Nicaragua had been up 16.91 percent in value conditions in 2019 to $131.01 million, while volume was down 3.73 percent to at least one 1.43 million dozen.

For Cambodia, a sizable portion of business was switched from China in order to avoid tariff costs, although the united states has its own concerns in labor that could bring about its losing preferential trade treatment from the European Union. Imports from the Southeast Asian country heightened 11.8 percent in value to 126.19 million, as volume reduced 0.49 percent in the year to at least one 1.22 million dozen.

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