A woman walks past a bench shaped like a missile painted with the U.S. flag outside of a clothing store at a shopping mall in Beijing, . President Donald Trump and Chinese President Xi Jinping agreed to a new cease-fire Saturday in a yearlong trade war during their meeting on the sidelines of a conference in Japan, averting, at least for now, an escalation feared by financial markets and the business community while negotiations continueTrump, Beijing, China - 29 Jun 2019

Buckle up because it could be a long journey.

Wall Street may have largely shrugged off last week’s escalation of the trade war between the U.S. and China, but fashion is still having to deal with the potential fallout.

In a dramatic switch from just a week ago when hope was high for a swift resolution, retail executives are understood to be bracing themselves for a trade war that could drag on for many more months and possibly years after President Trump unexpectedly unveiled plans Thursday to raise tariffs on all remaining Chinese imports that have yet to be targeted, officially pulling apparel and footwear into the dispute.

As a result, experts are expecting a raft of companies to begin accelerating plans to diversify production away from China in a bid to shelter themselves in the long run.

“What we’re going to see is anybody that wasn’t already getting out of China at a rapid pace is sure as hell going to be getting out at a rapid pace now,” Jan Rogers Kniffen, a retail consultant at J Rogers Kniffen, told WWD.

A number of major companies, including G-III Apparel Group Ltd., Levi Strauss & Co., PVH Corp., Guess Inc. and even Puma SE of Germany have already revealed they are working on reducing production there and government figures showed that some of China’s rivals are starting to see the benefits.

While apparel imports from China rose just 0.6 percent in the year to date, those from Vietnam and Bangladesh were up 11.7 percent and 14.5 percent, respectively, according to the Commerce Department.

What’s more, Mexico overtook China as the U.S.’s biggest trading partner overall during the same period.

However, David Silverman, a senior director at Fitch Ratings, cautioned that in some cases it may not be easy to switch sources of production.

“This will help avoid tariffs, though in some cases these companies could see higher manufacturing or shipping costs, and create execution risk related to new factory partners,” he said.

It’s also a process that cannot be done overnight as retailers can’t just slide into a new factory in a new country, without due diligence on social and environmental aspects — as well as the quality of products the factory produces — needed to be done.

In the shorter term, retailers with a heavy reliance on China have little room to maneuver, with 10 percent tariffs on $300 billion of Chinese imports, including apparel and footwear, set to come into force Sept. 1.

There’s also a fear that the administration could push that up to the previous threat of 25 percent duties if further provoked by China, which has pledged to retaliate, with an editorial in Chinese state news agency Xinhua on Friday stating the country does not want a trade war, but it is not afraid of one and will fight one if necessary. “In response to Washington’s tariff assaults since March 2018, China has had to take forceful counter measures. This instance will be no exception,” the editorial said.

Michael Binetti, an analyst at Credit Suisse, said a number of companies indicated to him they won’t be able to re-ticket goods already in the marketplace with higher prices likely until the beginning of next year, adding downside risk to second-half earnings.

At the same time, he cautioned that an expansion of tariffs to the full list of goods imported to the U.S. from China is likely to put more pressure on consumers’ purse strings.

“In other words, the bigger risk, in our view is that the consumer may have to opt out of purchases in discretionary categories as they see broad inflation across their household budgets,” he said.

Cowen’s Oliver Chen added that companies with limited sourcing exposure to China, greater exposure to staples, and limited private brand mix will be better positioned to withstand headwinds from tariffs. In particular, he named Tiffany & Co., Ulta and LVMH Moët Hennessy Louis Vuitton as some of the companies that stand to be the least impacted.