By Sydney Lazarus

As Washington and Beijing continue to one-up each other’s tariff threats, the prospect of a looming trade war is driving U.S. apparel companies to further diversify their sourcing strategy and shift production away from China. While China remains the top sourcing destination for the U.S. apparel industry, the country now accounts for 11%–30% of companies’ total sourcing volume, compared to 30%–50% in the past.

These insights come from the fifth annual benchmarking study, released by the U.S. Fashion Industry Association, on the industry’s sourcing practices and views on trade. The U.S.’s protectionist trade policy has become the industry’s top business challenge, with e-commerce competition and increasing production and sourcing costs closely following. As the chart below shows, more than three out of five respondents cited protectionist trade policy as one of their top five business challenges.

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