The fashion industry has always been a fast-paced, ever-evolving sector, but in 2025, the supply chain supporting it is undergoing some of the most dramatic transformations seen in recent years. From shifting consumer expectations to geopolitical turbulence, freight forwarders must navigate an increasingly complex landscape.
Fashion supply chains are facing immense pressure in 2025 due to a myriad of challenges, including raw material shortages, labor constraints, and logistics disruptions. Participating fashion leaders in the BoF-McKinsey State of Fashion Executive Survey — which polled 345 industry executives between August and October 2024 — have expressed concerns about the year ahead. According to the survey findings, 39% of fashion executives anticipate industry conditions to worsen, while 41% expect the market to remain the same.
“Consequently, 2025 is likely to be a time of reckoning for many brands,” according to the report. “The upshot is that there is still opportunity to be found for brands that move nimbly and are quick to adapt to upheavals in a chaotic marketplace.”
In this article, we’ll examine the latest trends, key challenges, and the risks affecting transportation and logistics in the fashion industry, along with how global geopolitics will shape the future of fashion supply chains.
Trends Defining Fashion Supply Chains in 2025
Trump’s Second Term: A New Era of Risks for Fashion Supply Chains
The potential return of President Donald Trump to the White House is sending shockwaves through the fashion industry, with supply chain leaders bracing for heightened trade tensions and tariff escalations. According to Sheng Lu, professor and director of graduate studies at the University of Delaware’s department of fashion and apparel studies, tariffs remain the foremost concern, posing significant risks to sourcing costs, inflation, and consumer spending.
Over the weekend, Trump signed executive orders imposing tariffs on imports from Canada, Mexico, and China. While duties on Mexican and Canadian goods have been postponed until March, the new tariffs on China-made apparel, textiles, and accessories took effect Tuesday, triggering retaliatory measures from Beijing.
Rising Costs and Inflationary Pressures
Tariffs on Chinese imports are poised to drive up production expenses, exacerbating inflationary pressures in an already strained economy. The Consumer Price Index (CPI) remains at elevated levels, and Lu warns that imposing further duties on China-made apparel would be akin to “adding fuel to the fire.” Higher sourcing costs could translate into increased retail prices, ultimately dampening consumer purchasing power and reshaping the competitive landscape for fashion brands.
Retailers React: Strategies to Mitigate Tariff Impact
While some discount retailers—such as TJX Companies—view the tariffs as a competitive advantage, major fashion brands are proactively adjusting their sourcing strategies to offset rising costs.
- Steve Madden has announced plans to slash its China imports by up to 45%, signaling a significant shift in its procurement model.
- Academy Sports and Outdoors has diversified its supply chain, steadily reducing reliance on Chinese manufacturing.
- Pellet grill manufacturer Traeger currently produces 20% of its grills in Vietnam but aims to expand its production footprint in the country to hedge against geopolitical risks.
The Future of Fashion Sourcing: A Shift Toward Nearshoring
Despite diversification efforts, Asia remains the backbone of global apparel manufacturing. According to McKinsey’s latest industry outlook, U.S. apparel and textile imports from China had already declined by six percentage points from a 2019 baseline. Over the past five years, investments in nearshoring—establishing production hubs closer to key markets—have surged by 20 percentage points in the U.S. fashion sector.
Brands are doubling down on a multi-pronged strategy that includes:
- Expanding regional manufacturing hubs in Mexico, Central America, and the Caribbean.
- Enhancing partnerships with Southeast Asian producers in Vietnam, Bangladesh, and India.
- Leveraging automation and AI-driven production to improve efficiency and reduce labor costs in nearshoring facilities.
Trump’s Crackdown on De Minimis: How Changes to the Import Rule Will Reshape Fashion Supply Chains
With President Donald Trump back in office, his administration is making sweeping changes to U.S. trade policy—one of the most immediate being the tightening of de minimis exemptions, a crucial factor in cross-border e-commerce. The de minimis rule allows imports valued under $800 to enter the U.S. duty-free, a provision that fast fashion giants like Shein and Temu have leveraged to keep prices low and shipping fast.
Now, under Trump’s executive orders, most Chinese products no longer qualify for de minimis, according to a notice from U.S. Customs and Border Protection (CBP). This move is part of a broader effort to curb China-based imports, close what some lawmakers call a tariff loophole, and push retailers to source more from U.S. manufacturers or alternative markets.
How This Will Disrupt Supply Chains
Eliminating de minimis for Chinese imports will send shockwaves through global supply chains, forcing retailers and logistics providers to rethink their strategies. According to McKinsey, prices for Shein and Temu products could rise by up to 20%, as these platforms either absorb the tariff costs or pass them on to consumers.
Beyond pricing, the policy shift could result in:
- Longer shipping times, as packages previously exempt from customs scrutiny now face inspections.
- Higher compliance and duty costs for e-commerce platforms reliant on China-based suppliers.
- Supply chain shifts, with companies accelerating moves toward Vietnam, India, and Mexico to avoid tariffs.
Trump’s Trade Policy: A New Era for Retailers
“With Trump’s new tariffs in place, closing the de minimis ‘loophole’ has become an urgent priority, as it prevented some retailers from feeling the full impact of previous tariff hikes,” said Sheng Lu, professor and director of graduate studies at the University of Delaware’s Department of Fashion and Apparel Studies.
Many U.S. retailers welcome these changes as a way to level the playing field against ultra-cheap foreign competitors. However, others warn that rising import costs and longer delivery times could ultimately hurt American consumers, particularly those reliant on affordable, fast-fashion goods.
With the Trump administration continuing to push for tougher trade restrictions, global brands will need to adapt quickly—whether by diversifying supply chains, adjusting pricing models, or investing in alternative manufacturing hubs—to remain competitive in this evolving trade landscape.
Sustainability in Fashion Supply Chain 2025: The Push for Greener Supply Chains
As fashion brands face increasing pressure to reduce their carbon footprint, sustainability in fashion logistics has become a top priority in 2025. Companies are doubling down on eco-friendly transportation, investing in low-emission freight solutions, and optimizing supply chains to cut waste and energy consumption. With governments tightening carbon regulations and consumers demanding greater transparency, brands are integrating green warehousing, biofuel-powered shipping, and circular economy models to stay competitive. Additionally, digital innovations like AI-driven route optimization and blockchain for supply chain traceability are helping fashion companies reduce emissions while maintaining efficiency. As the industry moves toward net-zero logistics, collaboration among brands, freight forwarders, and regulatory bodies will be key to achieving long-term sustainability goals.
Labour Concerns in Fashion Supply Chain 2025: The Growing Need for Transparency and Accountability
Exploitive labor conditions remain one of the most pressing and opaque challenges within global supply chains. According to human rights advocacy group Walk Free, approximately 50 million people were living in modern slavery as of 2021. The crisis is particularly severe in Asia and the Pacific, where over 29 million individuals are subjected to forced labor—exceeding the totals of all other regions combined.
In 2024, scrutiny over labor practices intensified when a Skechers supplier was accused of using forced labor from the Xinjiang Uyghur Autonomous Region (XUAR). The supplier was subsequently added to the U.S. Department of Homeland Security’s list of companies suspected of modern slavery. Similarly, Shein, the fast-fashion giant, has faced ongoing investigations and criticism regarding its cotton sourcing practices, particularly concerning potential ties to forced labor.
The growing number of such cases underscores an industry-wide shift toward greater supply chain transparency. As the Retail Industry Leaders Association (RILA) explained, forced labor is just one example of a broader expectation that companies engaged in global trade must fully understand their supply chains—from raw materials to finished products.
The Future of Ethical Sourcing and Supply Chain Resilience
As scrutiny over labor practices intensifies, companies must prioritize:
- Supply chain mapping and audits to ensure ethical sourcing.
- Investment in digital tracking technologies for greater visibility.
- Stronger compliance frameworks to meet regulatory demands.
- Diversified sourcing strategies to mitigate risks associated with geopolitical and labor market instability.
With modern slavery and labor shortages reshaping the global supply chain landscape, brands that take a proactive approach to ethical sourcing and workforce resilience will be best positioned to navigate the evolving regulatory and operational challenges in 2025 and beyond.
Wrapping up: Navigating the Next Four Years
With a second Trump presidency on the horizon, the fashion industry is preparing for another wave of disruption in transportation and logistics. From rising tariffs to shifting global trade alliances, freight forwarders and fashion supply chain leaders must remain agile, continuously reassessing sourcing strategies to mitigate risks. While diversification and nearshoring offer viable solutions, geopolitical uncertainties will continue to dictate the future of fashion supply chains.