A recent report, ‘The State of Sourcing Report: Sourcing and Sustainability in 2025’, reveals a significant shift in the global sourcing landscape. India is rapidly gaining prominence as a key sourcing region for UK retailers, challenging China's long-held dominance.

The report, published recently by Source Fashion, a leading fashion trade show, offers a comprehensive analysis of current sourcing practices and sustainability trends among UK retailers. The survey-based study, conducted in September-October 2024, gathered insights from a diverse range of retailers, both large and small.

Key findings

The report identifies India as the third most popular sourcing region among UK retailers, trailing only the UK itself and China. Notably, for larger businesses, India shares the second spot with the UK, underscoring its growing appeal.

Table: India’s emergence as popular sourcing region

While China remains a significant player, the report reveals its attractiveness is gradually diminishing due to various pressures, including rising costs, political uncertainties, and supply chain disruptions.

The report attributes India's emergence to several factors:

Cost-effectiveness: India offers competitive production costs, making it an attractive alternative to China.

Skilled Labor: India boasts a large pool of skilled labor, particularly in textiles and manufacturing.

Government initiatives: Supportive government policies, such as ease of doing business initiatives and infrastructure development, are further enhancing India's appeal

Industry experts echo the report's findings. As Sara Allbright, Co-Founder and Director of Retail 100 points out the importance of diversifying sourcing to mitigate risks associated with rising shipping costs and potential disruptions. She believes diversification into other countries and regions is an essential risk management exercise. Those with flexible near and far sourcing options will ultimately win out when you need to react quickly.

However, the report doesn't provide specific case studies of UK retailers successfully sourcing from India. Anecdotal evidence suggests major UK fashion retailers are increasingly turning to India for their sourcing needs. The report predicts continued growth for India as a sourcing hub for UK retailers. As pressures on China mount and India further strengthens its capabilities, the shift towards India is likely to accelerate in the coming years.