Bangladesh retains its position as the most competitive country in terms of product prices among apparel manufacturing nations, according to a global study conducted by the United States Fashion Industry Association.
However, the study reveals a decline in the price-competitiveness of Vietnam in 2023. Furthermore, the study also raises concerns about the increasing social and labour compliance risks associated with sourcing from China, Vietnam, and Cambodia.
The report indicated a decrease in social and labour compliance risks associated with sourcing from Bangladesh over the past two years, though some concerns still exist.
Based on a survey of 30 executives at leading US fashion companies conducted from April to June 2022, this year’s benchmarking study revealed a decline in Vietnam’s average rating for price-competitiveness from 3.8 to 3.5 in 2023.
Respondents rated Vietnam as less price-competitive compared to the previous year, citing inflation and wage increases in the country as contributing factors, as mentioned in the report.
Once again, respondents rated China and Vietnam as the most competitive in terms of sourcing flexibility and agility this year, attributing this advantage to the lifting of Covid restrictions in these countries, resulting in reduced supply chain disruptions and smoother movement of goods.
The report also highlighted improved ratings for several suppliers, including Vietnam, Bangladesh, India, Sri Lanka, and CAFTA-DR members, in terms of their sourcing flexibility and agility performance.