Apparel Wholesalers NAICS 424350

Mar 28, 2025 - Domestic Manufacturers’ Business Complicated by Tariffs

• According to Sourcing Journal, US-based apparel manufacturers face higher prices on foreign-made inputs, loss of business in sectors affected by duties, and waning goodwill from non-US customers thanks to new tariffs levied on China, Mexico, and China by the Trump administration. On a positive note, Mitch Gambert, CEO of Gambert Shirtmakers, said he has seen about a 20% increase in interest from brands and retailers looking for domestic sourcing. However, costs in key areas have increased due to tariffs. Gambert is paying an additional $5,400 on each order of 5,000 buttons sourced from China. When a Canadian fabric wholesaler implemented a 33% surcharge on all shipments, Gambert had to cut 50 fabric options from the portfolio and cancel already-placed orders. US apparel manufacturers are also concerned with higher costs for machinery, most of which are sourced from Asia or Europe.
• According to the Global Port Tracker report from the National Retail Federation (NRF) and Hackett Associates, tariff turmoil will contribute to elevated imports at major US container ports in spring 2025, but volume could decrease by the summer. Higher tariffs on goods from China announced by the Trump Administration are driving the elevated imports, with additional tariffs looming. Jonathan Gold, NRF VP for Supply Chain and Customs Policy, said retailers are bringing as much merchandise into the US ahead of rising tariffs as possible, noting, “Retailers have been working on supply chain diversification, but that doesn’t happen overnight.” Tracker data showed that US ports handled 2.2 million 20-foot equivalent units in January 2024, which was up 4.4% month over month and up 13.4% year over year. Imports may also be affected by a proposed fee of $1-$1.5 million for each time a Chinese-built ship docks at an American port.

• 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.
• Wholesale Trade is one of the 14 industries reporting growth in February’s Services ISM Report on Business. Executives in the Wholesale Trade industry reported increases in business activity, new orders, and employment, while reporting slower deliveries, decreased inventories, and higher prices paid for materials and services. Services industries reporting growth during the period included Finance & Insurance; Other Services, Utilities; Agriculture, Forestry, Fishing & Hunting; Mining; Real Estate, and Rental & Leasing. The three services industries reporting contraction during the period were Management of Companies & Support Services; Retail Trade; and Educational Services. Overall, economic activity in the services sector expanded in February, with the Services PMI registering 53.5%.