On a 6 August deadline, Modaes reports on recent findings on shifting sourcing trends from USFIA's Benchmarking Survey 2026:
Pablo Bueno | August 6, 2026
China continues to lose ground in supplying the U.S. fashion market, but companies are no longer simply shifting production to a single alternative market. U.S. companies are opting for a much broader diversification of their supplier network, incorporating new countries and spreading the risk across a greater number of sources, according to the 2026 Fashion Industry Benchmarking Study conducted by the United States Fashion Industry Association (USFIA) and the University of Delaware.
The most significant finding of the study is that China’s share of U.S. fashion imports fell to 9.7% by value during the first five months of 2026, down from 16.7% a year earlier. This marks the first time in several decades that China has fallen behind both Vietnam, which holds a 22.2% share, and Bangladesh, with 11.3%. At the same time, only 12% of the companies surveyed now source more than 30% of their supplies from China, compared to 19% in 2025 and 22% in 2024.
For the first time, China (9.7%) trails Vietnam (22.2%) and Bangladesh (11.3%) as a supplier of fashion to the United States
However, the report emphasizes that reducing dependence on China no longer means shifting orders to one or two specific countries, as had been the case in previous years. Vietnam and Bangladesh are also losing relative importance among U.S. companies: the percentage of companies that purchase more than 10% of their products from Vietnam has fallen from 76% to 58%, while that from Bangladesh has dropped from 56% to 47%. Instead, new destinations are emerging that are absorbing a growing share of orders, particularly Cambodia and other Asian markets, as part of a much broader regional diversification strategy.
This trend is also reflected in the number of markets from which U.S. companies source their products. In 2026, respondents reported sourcing from 49 countries, up from 46 a year earlier, while 65% of large companies now source products from ten or more different markets. However, the strategy is also shifting toward greater optimization of existing supply networks, with less interest in adding new suppliers and a greater emphasis on strengthening relationships with strategic partners that provide flexibility, production capacity, and traceability.
In 2026, orders from U.S. fashion companies to countries such as Cambodia, Guatemala, Egypt, and Jordan have increased
Although Asia remains the world’s leading manufacturing hub, the study identifies a growing shift toward other markets. Guatemala, Egypt, and Jordan are among the countries seeing the sharpest increase in use by U.S. companies, while the share of imports from regions outside Asia has reached its highest level in more than a decade. In the first five months of 2026, Asia’s share of U.S. fashion imports fell to 70.8%, down from 72.6% the previous year.
Despite this decline in prominence, China retains competitive advantages that make it difficult for international companies to completely abandon the country. The report notes that many companies believe they have already achieved their desired level of exposure to China and are now focusing their efforts on optimizing their overall supply chain. Respondents continue to particularly value China’s cost competitiveness, production flexibility, ability to handle small minimum order quantities, and the high degree of vertical integration in its textile industry.
In 2026, Asia will continue to account for nearly 71% of U.S. fashion imports, down from 73% in 2025
According to the study, the ongoing process of decoupling from China is driven less and less by economic factors and more by geopolitical, regulatory, and compliance issues. Trade uncertainty, the risk of new U.S. restrictions, and concerns related to forced labor are emerging as the main factors redefining the global supply chain landscape for the fashion industry.
Who Benefits from the U.S.’s New Sourcing Strategy? The gradual shift of orders away from China is not benefiting a single country, but rather an increasingly broad group of markets. The USFIA study identifies Cambodia as one of the main beneficiaries of this trend, consolidating its position as an alternative for labor-intensive apparel manufacturing. Alongside Cambodia, Guatemala, Egypt, and Jordan are seeing growing interest from U.S. companies, driven both by their trade agreements with the United States and by the pursuit of greater geographic diversification.
The report also highlights the growing appeal of the countries that are part of the CAFTA-DR agreement (the Dominican Republic, Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua), which are gaining prominence due to their proximity to the U.S. market and the tariff advantages they offer. For many companies, these markets allow them to reduce lead times and diversify risks without relying exclusively on Asia—a strategy that is gaining importance in a context marked by trade and geopolitical uncertainty.