First of all, the clothing industry may face a global economic slowdown and weakening consumer demand in 2023.
The clothing industry is a buyer-driven industry, which means that the trade volume and output of the industry will be affected by the macroeconomic environment. In the context of rising inflation, high energy costs and tight global supply chains, major international economic institutions such as the World Bank and the International Monetary Fund (IMF) have unanimously predicted that global economic growth will continue to slow down in the new year. Similarly, the World Trade Organization (WTO) predicts that the world commodity trade will increase by about 1% in 2023, far lower than the 3.5% in 2022.
It is estimated that the global clothing trade will increase slightly by 0.8% to 1.5% in the new year, reaching the lowest level since 2021. On the other hand, the decline in demand may help alleviate the rising pressure of purchasing costs faced by fashion enterprises in the new year. Secondly, fashion brands and retailers may continue to make use of diversified procurement sources and strengthen the relationship with major suppliers to cope with the volatile market environment. According to the 2022 fashion industry benchmark research data conducted by the American Fashion Industry Association (USFIA), nearly 40% of the surveyed American fashion companies plan to purchase clothing from different national markets and cooperate with different suppliers by 2024. It is worth noting that "improving flexibility and reducing resource risk", "reducing procurement volume from China" and "exploring near-shore procurement opportunities" are the main driving forces for the diversification strategy of procurement sources of American fashion companies. At the same time, fashion companies will continue to optimize their supplier base, and it is not common to cooperate with "fewer suppliers" in the future. For example, fashion companies increasingly like to cooperate with so-called "super suppliers", namely those with multinational manufacturing capabilities or can vertically produce textiles and clothing, in order to achieve procurement flexibility and agility. As more and more fashion companies recognize the business strategic value of "taking suppliers as the core", we can also see a more balanced relationship between suppliers and importers in the new year.
The importance of improving the sustainability of procurement and the use of sustainable textile materials will be highlighted in the new year. On the one hand, with the increasing expectations of stakeholders, under the impetus of the new regulations, fashion companies will make more efforts to develop a more sustainable, more socially responsible and more transparent clothing supply chain. For example, more and more fashion brands and retailers voluntarily began to publish their supplier information to the public, such as factory name, location, production function and compliance records. In addition, new traceability technology and close cooperation with suppliers can help fashion companies better understand the raw material suppliers they face than in the past. It is worth noting that rich supplier data will provide important support for fashion companies to optimize the existing supply chain and improve operational efficiency. On the other hand, as consumers become more and more interested in the sustainability of the fashion industry, fashion companies will also cater to the market demand and continue to introduce such environment-friendly materials and clothing. The latest research shows that purchasing clothing made of recycled textile materials can not only have a positive environmental impact, but also help fashion companies gain commercial benefits. In the United States retail market, a large part of such products come from "Made in the United States" or from emerging procurement markets such as Africa (such as Tunisia and Morocco). For Chinese suppliers, improving the production strength of such materials and clothing may further save the purchaser's funds when the other party "moves back" the procurement source. Related to environmental protection materials and clothing, we may also see more trade policies such as tariff preferences provide broader support to fashion companies in the future. At the same time, driven by various economic and non-economic factors, fashion companies may further explore the "supply chain nearshore" strategy in 2023, and they will also need to pay more attention to the impact of existing free trade agreements and their specific mechanisms on their procurement practices.