WASHINGTON — The number of apparel suppliers shipping goods to the U.S. dropped precipitously in the year ending Oct. 31, falling more than 85 percent in the 12-month period.
There were 6,262 apparel suppliers actively sending shipments to the U.S. at the end of October, down from 43,653 a year earlier, according to a report being released today by Panjiva Inc., a New York-based firm that helps brands evaluate factories.
The report, drawn from U.S. Customs and Border Protection data and other sources, illustrates an accelerating drop in the number of apparel suppliers. The supplier count fell to 22,099 in July, 16,969 in August and 11,513 in September before tumbling to current levels.
Of those still-active factories, 40 percent are considered at risk and have been added to Panjiva’s Watch List, said Josh Green, chief executive officer of the firm. Suppliers included in the listing are those that have suffered a 75 percent or higher year-over-year drop in volume shipped to U.S. customers. The percentage of companies tracked by Panjiva that are on the Watch List also increased in recent months. In August, only 24 percent of suppliers showed steep enough declines in shipment volume to be considered risky, Green said.
“These numbers paint a frightening picture of the state of the world’s suppliers,” he said. “U.S. companies who maintain their customer base through the economic downturn may nevertheless find their survival threatened by the disappearance of their supplier base.”
The apparel industry had a “deer-in-the-headlights moment,” Green said. When faced with uncertainty about the economy, many companies reduced the size and frequency of orders they placed, which is a reasonable strategy for an individual company, he said. Problems arose, however, when that strategy became widespread.
“Put it all together and you have a situation where a lot of suppliers are not going to survive as a result,” he said. “That is bad news for the suppliers. But also, in the long run, it’s bad news for the buyers because when the market does pick back up, the buyers are going to look around and the supply base is not going to be where it was.”
The long-term impacts of a shrinking supplier base could affect the availability of product and the ability of importers to get product to market on time, said Eric Emerson, a trade attorney and partner with Steptoe & Johnson. That kind of uncertainty or variability will put pressure on companies trying to find qualified suppliers, he said.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty