Apparel Wholesalers NAICS 424350

Jan 27, 2026 - Flat Retail Spending Pressures Apparel Wholesalers

• According to Fibre2Fashion, US retail conditions are creating a challenging demand environment for apparel wholesalers as discretionary spending weakens. Circana data showed that total US retail spending was flat in December, and unit demand declined 1% during the five weeks ending January 3, 2026. Discretionary general merchandise, where apparel is concentrated, performed worse than the broader market, with dollar sales down 2% and unit demand falling 5% year over year for the period. For full-year 2025, discretionary general merchandise posted 0.5% dollar growth and a 1.3% decline in unit sales. Elevated prices are constraining purchases, and impulse buying has dropped below 20% of consumer responses for most categories. New products now account for only 2% of discretionary sales, down from a historical norm of 5%. For apparel wholesalers, trends point to pressured volumes, heightened price sensitivity, and a need for product innovation and refreshed assortments to stimulate retailer orders.
• Apparel prices were 0.6% higher in December 2025, compared to the previous year, according to the Consumer Price Index by the US Bureau of Labor Statistics (BLS). Prices for the category were down 1.3% from the previous month. Employment by apparel clothing and clothing accessories merchant wholesalers fell 4.8% in August 2025 compared to a year ago, according to the BLS. Employment in the industry for the past decade has fallen by 9.1%, lower than the 13% growth in overall private employment. Producer inflation for apparel and piece goods merchant wholesalers was up 4.5% in September 2025 compared to a year ago, according to producer price data released by the BLS. Sales for apparel wholesalers were 5% higher in July 2025 compared to a year ago, according to data from the US Census Bureau.

• The apparel industry is facing significant disruption from US tariffs, which have sharply increased costs and reshaped sourcing strategies, according to a report in the Business of Fashion (BOF). The BoF–McKinsey State of Fashion 2026 report showed that duties on apparel and footwear imports spiked from 13% to 54% in spring 2025 before easing to 36%, above historical norms. With the US importing 89% of apparel and leather goods, manufacturers are among the hardest hit. Some 76% of fashion executives say tariffs and trade disruptions will be the key factors shaping the industry in 2026. Supply chains are shifting: US imports from Cambodia rose 42% between 2019 to 2024, while imports from China fell 30%. To offset margin pressures, brands are raising prices, renegotiating supplier terms, and streamlining assortments. Manufacturers are diversifying production footprints, with expansions into Vietnam and Kenya, underscoring the need for agility in a volatile trade environment.
• While five services industries reported contraction in December, 11 industries reported growth, including the Wholesale Trade industry, according to an ISM Services PMI Report. Executives in the Wholesale Trade industry reported increases in business activity, new orders, employment, prices paid for materials and services, new export orders, imports, and order backlogs, along with a decrease in inventories in December. Other industries reporting growth during the period were Finance & Insurance; Accommodation & Food Services; Transportation & Warehousing; Arts, Entertainment & Recreation; Mining; Health Care & Social Assistance; Information; Retail Trade; Public Administration; and Utilities. Industries reporting contraction during the period include Management of Companies & Support Services; Professional, Scientific & Technical Services; Agriculture, Forestry, Fishing & Hunting; Educational Services; and Construction. Overall economic activity in the services sector continued to expand in December, registering 54.4%.