A couple of things have happened in China recently that have made sourcing garments from there increasingly difficult and expensive:
According to ING, we shouldn’t expect any shipping price improvements before 2023, especially for goods shipped from south-east Asia. They are currently on a moderate decrease, but it’s by no means offsetting the sharp increase that happened during 2021 and early 2022.
Let’s see other reasons for shifting at least a portion of your manufacturing outside China and closer to your target market(s) in more detail. The good news is that it’s even possible to find suppliers with similar manufacturing costs.
Why you should stop sourcing clothes from China right now
There are several China supply chain issues – some are already affecting the market, and some will do so in the future.
Electricity-related delivery delays
Ever since the pandemic started, China has been implementing planned power restrictions, especially in the industrial provinces. That causes delivery delays and increased manufacturing costs. During the 2022 heatwaves, the government imposed additional power restrictions due to an unprecedented increase in electricity usage for ACs.
That means that you must account for production delays when you plan to work with Chinese manufacturers.
Shipping delays from entire south-eastern Asia
Since China has the most significant ports, shipping delays have hit this country the most. Because the pandemic-related lockdowns reduced the workforce in ports, that disrupted the balance of supply and demand. The results are still visible – massive price hikes and unpredictable delivery.
What was once a $1000 container is now ten times that.
What was once a one-month delivery is now something you wait for up to 100 days.
China’s unrelenting COVID-19 policies
Even though symptoms of COVID-19 have been much milder ever since the Omicron strain, China imposes the same lockdown rules as soon as new cases of infection appear. This affects mills, factories and ports and makes your cooperation with a clothing manufacturer from China very unreliable.
Elephant in the room
Yes, we’re talking about China’s increasingly strained relations with Taiwan. There’s no telling how it would turn out, whether it would relax or escalate. One thing is certain – you don’t want to depend on a Chinese manufacturer should these events develop badly.
Another elephant in the room – alleged Uyghur forced labour in China
If your brand is using cotton in its collections, you might want to steer clear of being associated with cotton from the Xinjiang region. Tomoya Obokata, an international scholar of international law and human rights concluded, in his report to the UN’s general assembly, that there are strong indications that China was using forced labour in this region.
What makes this additionally worrying is the fact that most Chinese cotton comes from Xinjiang. You don’t want to risk potentially using forced labour for your brand’s clothing. It’s wrong in itself and it should be enough reason to start looking for made-in-China alternatives.
How to find supply chain alternatives to China?
If you start looking for the next manufacturing hub after China in south-eastern Asia, you’ll just end up with a manufacturer with most of the same issues. The cheap manufacturing price is trumped by transport price hikes and unreliable delivery.
This means you’d have to look elsewhere.
European clothing manufacturers
If your target market is Europe, the best manufacturing hub for you would the somewhere in the old continent. Not just because there’s still relatively cheap labour in Europe, especially in the Balkans, but because sourcing close to its target market is the most sustainable thing a fashion or activewear business can do. This method of sourcing is called nearshoring.
FUSH˚ as a European clothing manufacturer
We believe FUSH˚ belongs to the group of great alternatives for China manufacturing, especially for European markets for the following reasons:
Compare all that to full-blown unpredictability and potential PR disaster that awaits you with a supply chain from China. It seems very simple what the best choice is.
Now that you know how unreliable and increasingly costly and risky it is to source from China and to an extent, from south-east Asia, you might finally embrace a significantly more sustainable way of sourcing clothing – from countries much closer to your target market.
This is why FUSH˚ can be your ideal manufacturing partner for one of the biggest markets – Europe. Let us know more about your project and how we can help bring it to life, fill out the contact form below.