Apparel Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,100 apparel manufacturers in the US transform fabrics into clothing and accessories. The companies described in this report are known as “cut-and-sew” apparel manufacturers, and produce items such as dresses, suits, shirts, and pants. “Cut-and-sew” manufacturers differ from apparel knitting mills, which produce knit products, such as hosiery, socks, and underwear. Apparel firms design and market apparel, but may outsource their entire manufacturing operations to firms outside the US.
Demand Driven by Trends
The apparel market is driven by constantly evolving fashion trends and fads, many of which can be short-lived.
Complications from Foreign Production
Apparel companies that rely on foreign firms for any part of production are more vulnerable to remote management problems, increases in transportation expenses, and trade-related issues.
Industry size & Structure
A typical apparel manufacturer employs about 12 workers and generates $1-2 million annually.
- The apparel manufacturing industry consists of about 4,000 companies that employ about 48,100 workers and generate $7.4 billion annually.
- The industry is fragmented - the 20 largest companies account for 22% of industry sales.
- Most large apparel companies, such as VF Corporation, PVH Corp., Levi Strauss, and Ralph Lauren, outsource the production of garments to low-cost manufacturers located abroad. Gildan, a large Canadian apparel manufacturer, owns American Apparel, Comfort Colors, and other brands, with manufacturing facilities in the US and overseas.
Industry Forecast
Apparel Manufacturers Industry Growth
Recent Developments
Jan 29, 2025 - Luxury Market Growth Expected in US
- A new global luxury market forecast from McKinsey projects that apparel, including ready-to-wear and footwear, will grow between 2% and 4% between 2025 and 2027, according to Fashion Dive. The “State of Luxury: Fashion” report found that the US is expected to outpace other regions in luxury market growth, with the market expected to grow between 4% and 6% compared to lower projections for Europe and China. The personal luxury goods market, which includes fashion, leather goods, watches, and jewelry, has grown in recent years, with 5% growth each year between 2019 and 2023, mostly propelled by price increases.
- Consumer confidence levels declined in December 2024, falling by 8.1 points from the previous month, according to The Conference Board. The Consumer Confidence Index was 104.7 in December 2024 from 112.8 in November 2024. Dana Peterson, chief economist at The Conference Board, noted that those remaining most confident on a six-month moving average basis confidence were those aged under 35 and those in the income category of over $100,000. Per Peterson, “The recent rebound in consumer confidence was not sustained in December as the Index dropped back to the middle of the range that has prevailed over the past two years.” Purchasing plans for homes decreased while plans to buy new cars and big-ticket items rose in December 2024 on a six-month average basis.
- Apparel costs are expected to increase according to a new study by the National Retail Federation (NRF) of the estimated impact of President Donald Trump’s tariff proposals. The study looked at the effect of tariffs on prices of major consumer product categories including apparel, toys, furniture, household appliances, footwear and travel goods. Trump has proposed a universal 10-20% tariff on imports from all countries and an additional tax on imports from China. Per the NRF study, consumers would pay $13.9 billion to $24 billion more for apparel, $8.8 billion to $14.2 billion more for toys, $8.5 billion to $13.1 more for furniture, and $6.4 billion to $10.9 billion more for household appliances with the proposed tariffs in place. The study showed the tariffs would have a “significant and detrimental impact” on the costs of a wide range of consumer products, in particular those products supplied primarily by China. According to Jonathan Gold, NRF vice president of supply chain and customs policy, “Retailers rely heavily on imported products and manufacturing components so that they can offer their customers a variety of products at affordable prices. A tariff is a tax paid by the U.S. importer, not a foreign country or the exporter. This tax ultimately comes out of consumers’ pockets through higher prices.”
- According to a mid-year analysis from Just Style, US fashion companies are increasingly sourcing apparel from India, Cambodia, Pakistan, Jordan, and Guatemala, which all gained additional market share in the first half of 2024 compared to a year ago. Dr. Sheng Lu, a professor of apparel studies at the University of Delaware, said there are several reasons the countries are gaining new momentum as emerging sourcing destinations. “In addition to production capacity, these countries seem to benefit from their perceived relatively lower social and environmental compliance risks and lesser involvement in geopolitical tensions at this moment,” he said. In the first half of the year, China accounted for 33.2% of US apparel imports, Vietnam accounted for 16.7%, and Bangladesh accounted for 9.6%. Year over year during the period, China and Vietnam increased share while Bangladesh lost share, which Lu said pointed to stronger demand for more personalized, customized, and value-added items.
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