What: Rising costs, shifting trade policies, and geopolitical tensions are pushing fashion brands to diversify their sourcing strategies, moving away from China and exploring nearshoring and alternative Asian markets like India and Vietnam.

Why it is important: As global trade dynamics evolve, fashion companies must adapt to maintain supply chain resilience, reduce costs, and meet sustainability targets, all while navigating increasing trade restrictions and rising labour costs.

The BoF-McKinsey State of Fashion 2025 report highlights how fashion brands are rethinking their global sourcing strategies amid rising costs, evolving trade policies, and geopolitical shifts. The US and Europe are diversifying away from China, with imports from the country dropping significantly between 2019 and 2023. Markets like India, Vietnam, and Bangladesh are emerging as key sourcing hubs due to lower labour costs. Nearshoring is also gaining traction, with regions like Latin America for the US and Turkey for Europe becoming important alternatives. The report underscores the need for fashion executives to regularly assess their sourcing footprint, develop strategic relationships with suppliers, and collaborate on sustainability goals. These shifts aim to build more resilient supply chains that can adapt to future disruptions while meeting cost-efficiency and environmental targets.

How fashion is shaking up its global sourcing strategies