Dear USFIA Members, Affiliates, & Friends,

Happy New Year!

One year ago, we were bracing for major changes to trade policy and the uncertainty these changes would create for brands and retailers operating global supply chains.

Now, as we begin another year, trade policy—and specifically, the impact of the U.S.-China trade war and the uncertainty about the future of U.S. trade policy—remains my top concern. And while the fashion industry hasn’t been hit nearly as hard as other industries by the new tariffs and the escalation of the tensions with China, we are definitely not in the clear.

Not by a long shot.

As the year opens, the stock market continues to be volatile and holiday retail sales numbers remain challenging due, in part, to consumers facing rising prices on many everyday household products imported from China, such as electronics, holiday décor, beverages packaged in aluminum cans and, of course, some of the handbags, accessories, and other textile products added in the last round of tariff increases. And now, the United States and China have just until March 2nd to come to an agreement or those retaliatory tariffs will increase from 10 percent to 25 percent.  As we all know, this would have an even more severe impact on American families who remain concerned about job prospects, inflation, and their fluctuating retirement accounts.

The elephant in the room is President Trump’s threat to raise tariffs on all imports from China, including apparel and footwear—a decision that could be made at any time.

Still, the outlook is not entirely bleak. In fact, there were some positive developments on trade policy in 2018, too. The United States, Canada, and Mexico successfully renegotiated and signed the “new NAFTA,” which includes some positive changes for our industry such as the elimination of the visible linings requirement for tailored clothing and the continuation of the Tariff Preference Levels, which many companies use when sourcing from the region. In addition, the Trump Administration made moves to negotiate a few new bilateral trade agreements with Japan, the United Kingdom, and the European Union, all of which could provide benefits for our industry as we seek new sourcing destinations to manage the impact of the rising tariffs and, even more importantly, new markets for our products.

It’s been a difficult year for everyone working in trade and retail. Many brick and mortar retailers continue to deal with declining sales, store closures and even bankruptcy. But these facts—including the so-called “retail apocalypse,” the trade uncertainty, and the potential new markets—provide an opportunity for us to innovate and emerge even stronger than before.  Thanks to new markets, social media, low unemployment, and a climbing GDP, consumers are still shopping. As we tackle the challenges ahead, we have an opportunity to think creatively about our supply chains, our products, our groundbreaking sustainability initiatives, and our stores, to become even better brands and retailers for America and for the world. We all need to be prepared for the challenges that will be coming our way in the New Year.  


Michael Singer
Chairman of the United States Fashion Industry Association (USFIA)
Vice President of Customs & Social Compliance for Macy's Merchandising Group