China will overtake the US and become the world’s largest apparel market by 2019. Annual apparel sales in China in 2019 would be up 25 per cent from 2014. In comparison, apparel sales in the US would grow just three per cent over last year’s sales. Despite falling yuan, rising raw material and labor costs, China would continue to be a leader in the global apparel market.
The Chinese market is more competitive than the US because no apparel brand in China was able to achieve a market share greater than one per cent in 2014. Domestic brands overall outperform international brands in the Chinese market. Controlling sourcing cost will be equally important for China as well as the United States. Most US apparel imports are Made in China with the applied tariff rate as high as 9.63 per cent for textiles and 16.05 per cent for apparel.
US imports are continuing to rise. Apparel importers in the US expect greater inbound shipments from Asia this season, but they are shipping later. Peak season isn’t July anymore. It’s slipping back a bit for many fashion companies. They are looking at shipping in August, September or even October.