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US Buyers Procuring RMG Procurement from Bangladesh: USFIA Survey

According to a recent study by the American Fashion Industry Association (USFIA), nearly half of US fashion brands and buyers feel that Bangladesh prices are lower than the world average, so they will source from Bangladesh over the next two years. Aspire to. The unit price of Bangladeshi apparel products was found to be $ 2.5 from the global average of $ 2.6 from July to May this year.

Again this year, respondents to the 2021 Fashion Industry Benchmark Survey said Bangladesh offers the most competitive prices, followed by China, Vietnam, Indonesia, India and Cambodia. This is in line with the survey results from 2017 to 2020.

Forty-eight percent of respondents were interested in increasing procurement from Bangladesh by 2023, of which 11% expected a significant increase.

“China Plus Vietnam Plus Many” remains the most popular procurement model among respondents.

China offered a more competitive price than Bangladesh, but U.S. buyers procured China and Vietnam to avoid “putting all eggs in one basket” and mitigate various procurement risks. The report said it showed interest in diversifying from Vietnam.

The US-China tariff war exacerbated procurement cost pressures and financial challenges faced by US fashion companies during the pandemic.

Due to the tariff war, U.S. fashion companies will have to pay an average import tariff rate of 23.4% on apparel imports from China in 2020, which is an additional tariff of 16.5% (or $ 1.078 billion) in 2017. ) Was much higher, the report said. found.

Vietnam remained a hot source for US buyers, but respondents became more conservative about Vietnam’s growth potential.

According to the survey, two factors, concerns about procurement costs and potential trade restrictions, may be the reason why respondents are hesitant to increase procurement orders to Vietnam.

The decision to investigate Vietnam’s currency practices and its “use of illegal timber” launched by the Trump administration remained pending until it created trade uncertainty.

Respondents said that the apparel “Made in Bangladesh” had a price advantage over many other Asian suppliers, but the competitive disadvantage was that US apparel imports from Bangladesh were a basic fashion item. Too much focus on, especially consumer demand is pandemic.

“Diversifying the structure of export products and improving production flexibility and agility is important for Bangladesh to play a more important role as an apparel sourcing hub for US fashion companies in the post-COVID world.” The report states.

Over the next two years, US fashion companies have maintained a high overall interest in sourcing more from Bangladesh, but companies will work with fewer vendors in the country.

“This new trend means more competition among thousands of Bangladeshi apparel suppliers. Competitive suppliers will benefit from more sourcing orders, but smaller and less competitive. Things can be more vulnerable, “the research says.

According to a survey, Asia’s position as a major apparel sourcing hub for US fashion companies remained unwavering in the Covid-19 pandemic.

Almost all of the top 10 most used apparel sources in 2021 are based in Asia, led by China (93%), Vietnam (87%), India (77%) and Bangladesh (73%). increase. Indicated.

Respondents still believe that sourcing from Bangladesh has a relatively higher compliance risk than many of its rivals.

Respondents believe that the dissolution of the Bangladesh Workers Safety Alliance and the Bangladesh Fire and Building Safety Agreement will not help build confidence in Bangladesh’s social responsibility practices.

Fiber2Fashion News Desk (DS)

Almost half of U.S. fashion brands and buyers feel that Bangladesh’s prices are lower than the world average and are eager to procure from Bangladesh over the next two years, according to a study by the American Fashion Industry Association. Bangladeshi apparel products were $ 2.5 compared to the global average of $ 2.6 from July to May.



US Buyers Procuring RMG Procurement from Bangladesh: USFIA Survey

Source link US Buyers Procuring RMG Procurement from Bangladesh: USFIA Survey

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