As the world commerce recovers from the COVID pandemic, apparel sourcing still faces numerous challenges: demand volatility, logistical issues, rising costs, and more. As never before the supply chain has become top priority on executive’s agendas.

It’s becoming more certain that supply-chain disruptions such as the price of shipping and raw materials and strains on capacity are here to stay.

Nearly half of all companies have started a major transformation to achieve speed and flexibility. A fundamental shift is becoming apparent namely the shift toward a sourcing model that is flexible, fast, sustainable, digitally enhanced, and consumer-centric. Findings confirm that dramatic change is underway.

More and more companies have embarked on organizational transformations by revamping their manufacturing outsourcing and design processes, their work organization, and their commercial priorities.

Supply-chain stumbling blocks

• Shipping disruptions: Harbor shutdowns, port congestion, container shortages, and capacity issues have all contributed to delays and disruptions.
• Volatility of demand: Post COVID we see uneven recovery and demand volatility. Consumers spending that was on hold has been released straining production and transport capacities.
• Increased prices of materials. Raw-material prices are surging and further price increases are expected. Price markups in nearshore markets are contributing to this trend.
• Uneven recovery: Uneven global recovery rates will continue to affect business in the next few years.
• Raw materials supply problems: The industry is plagued by supply issues due to the slowed flow of raw materials from China. A shift to nearshore sourcing is hampered by limited raw-material supply and price markups.
• Online sales: During the COVID pandemic there was a surge in online sales which are at lower levels currently. Combined with this phenomenon new generation of online fast fashion players are on the rise.
• About 45% of the world's textile and clothing exports belong to the Asian region. However lately there has been a reverse trend. Exports from Bangladesh dropped by nearly 17%.

According to the Financial Post things are going to get much worse as the UK and USA have banned cotton imports amidst allegations of forced labor in China and the European Union is considering a similar move, the negative aftereffects of which can be seen on the Chinese textile industry.

In the US apparel market alone, China has lost over US $ 8 billion market share till 2022 as compared to 2017.

Uneven demand, high raw material prices, high energy prices, and inflation are the four major concerns of the global textile industry for the next six months. Concerns about geopolitics have also increased significantly in the past months. High transport costs also play a major role.