Can Tariffs Really Revive 'Made in USA' Fashion?

Summary

Podcast Summary: "Can Tariffs Really Revive 'Made in USA' Fashion?"

Podcast Information:

• Title: The Business of Fashion Podcast
• Host/Author: The Business of Fashion
• Episode: Can Tariffs Really Revive 'Made in USA' Fashion?
• Release Date: April 15, 2025

---

Introduction

In this episode of The Business of Fashion Podcast, host Sheena Butler Young, alongside executive editor Brian Baskin, explores the impact of the Trump administration's tariffs on the US fashion industry. The discussion centers on whether these tariffs can effectively revive American manufacturing and protect US businesses from the influx of cheap Chinese imports. BOF correspondents Malik Morris and Mark Bain provide in-depth analysis and insights throughout the conversation.

---

Understanding the Trump Administration's Tariffs

Malik Morris (00:54):
Malik begins by outlining the scope of the tariffs imposed by the Trump administration, highlighting their significant impact on the fashion industry's primary manufacturing hubs. He notes, “Trump showed a chart with tariffs he would impose on goods imported from other countries. And not only were they astronomically higher than anyone expected” (01:10). The tariffs included:

• China: Over 100%, sparking retaliatory measures.
• Vietnam: 46%
• Bangladesh: 37%
• European Union: 20%

These tariffs aimed to reduce the reliance on Chinese manufacturing but inadvertently affected other key suppliers, creating widespread disruption across the fashion supply chain.

---

The Administration's Messaging: Reviving US Manufacturing

Sheena Butler Young (02:53):
Sheena inquires about the administration's narrative regarding the benefits of these tariffs for US jobs and manufacturing.

Malik Morris (03:03):
Malik responds critically, stating, “the goal here is pretty noble on the surface... but really, honestly, it's just forcing other territories to negotiate with the US” (03:03). He argues that while the tariffs are intended to boost domestic manufacturing, they may instead destabilize the economy without guaranteeing a resurgence in US manufacturing prowess, particularly in apparel.

---

Potential for Increased US Manufacturing

Brian Baskin (03:40):
Brian questions the feasibility of significantly increasing domestic garment manufacturing given that 99% of US clothing is currently imported.

Malik Morris (03:56):
Malik provides a nuanced view, mentioning that while large-scale revival is unlikely, there are existing US-based brands successfully maintaining domestic production. He cites brands like American Giant, which produce everyday apparel in the US, highlighting their ability to sustain without drastic price hikes. “They have to get people to care about where their products are coming from” (07:18).

Example Brands:

• American Giant: Offers premium basics with domestic production.
• Filson: Emphasizes craftsmanship and local manufacturing in Seattle.
• At Present: An online jewelry retailer focusing on American artisans.

---

Challenges in Scaling US Manufacturing

Sheena Butler Young (09:03):
Sheena probes into the infrastructural limitations hindering the mass-scale revival of US manufacturing.

Malik Morris (09:29):
Malik identifies key barriers:

• Higher Costs: Labor in the US is more expensive.
• Skilled Labor Shortage: Limited availability of skilled workers.
• Infrastructure Deficits: Lack of existing manufacturing capacity.
• Immigration Policies: Restrictive policies reducing the labor pool.

He concludes, “the ideal of manufacturing US is not only achievable or sustainable in the long term” (09:29), underscoring the substantial obstacles that prevent a swift transition back to domestic production.

---

Impact on Chinese-Manufactured Brands

Sheena Butler Young (13:00):
The conversation shifts to the repercussions for brands heavily reliant on Chinese manufacturing.

Mark Bain (14:20):
Mark explains that small brands, unlike large multinationals, are particularly vulnerable. “Small brands might have their supply chain concentrated in one area and maybe even one factory” (14:20), making them susceptible to drastic tariff increases. The lack of flexibility and infrastructure outside China exacerbates their predicament, often leading to shutdowns or significant operational struggles.

Brian Baskin (17:36):
Brian summarizes the dire situation, noting that many small brands have no viable alternatives beyond enduring increased costs or shutting down.

---

Consumer Response and Market Dynamics

Sheena Butler Young (18:23):
Sheena raises the issue of consumer behavior in response to potential price hikes and reduced availability of affordable imports.

Mark Bain (18:58):
Mark speculates on possible shifts, suggesting consumers might turn to higher-priced options like Walmart or Costco for basics, although overall spending may decline. He emphasizes that brands like Shein and Temu, known for their low prices, face existential threats as their business models are directly targeted by the tariffs.

Malik Morris (19:36):
Malik envisions a scenario where consumers move away from ultra-cheap fashion towards secondhand or vintage options, aligning with sustainability trends. “Maybe they'll go secondhand, maybe they'll go vintage” (19:36).

---

The Role of the Chinese Government

Brian Baskin (21:50):
Brian touches upon China's potential interference in international trade dynamics.

Mark Bain (22:31):
Mark highlights China's authoritative stance, comparing it to the TikTok scenario. “If you want access to the Chinese market, you kind of have to play ball with the Chinese government” (22:31). He discusses instances where China has retaliated against brands that criticize its practices, limiting their business operations within China as leverage.

Example:

• Sendbags (23:53): A Chinese handbag manufacturer leveraging TikTok to promote locally made alternatives to luxury brands, challenging the US market dynamics.

---

Long-Term Viability of 'Made in USA' Fashion

Sheena Butler Young (25:35):
Sheena asks for a conclusive perspective on the long-term prospects of American manufacturing in fashion.

Malik Morris (25:35):
Malik is skeptical, stating, “the immediate verdict on that is no” (25:35). He emphasizes that while some brands can sustain, widespread revival of US manufacturing in fashion faces insurmountable challenges.

Mark Bain (26:07):
Mark reinforces the bleak outlook, citing statements from trade groups like the American Apparel and Footwear Association. “We are not restoring American manufacturing of sneakers and clothing on any sort of mass scale in our lifetimes” (26:07). He underscores the lack of infrastructure and the impracticality of reshoring large-scale manufacturing.

Public Sentiment:
A poll mentioned by Mark reveals that while over 80% of Americans support reviving manufacturing, only 20% are willing to work in factories, indicating a disconnect between public support and workforce availability.

---

Conclusion

The episode concludes on a somber note, recognizing that while tariffs aim to protect and possibly rejuvenate US manufacturing, the reality is fraught with challenges. The lack of infrastructure, skilled labor shortages, and entrenched supply chains in China make the revival of 'Made in USA' fashion highly improbable in the near future. Additionally, the impact on small brands and consumer behavior further complicates the potential success of these tariffs in achieving their intended goals.

Final Verdict:
Reviving American fashion manufacturing through tariffs is unlikely to materialize quickly or at scale. The industry must navigate complex global supply chains and consumer expectations amidst ongoing trade tensions.

---

Notable Quotes:

• Malik Morris (03:03):
  “The goal here is pretty noble on the surface if you think about it... but really, honestly, it's just forcing other territories to negotiate with the US.”

• Sheena Butler Young (06:32):
  “Could you really lean into that as a brand and expect to do well or does it feel like you're getting into politics now?”

• Mark Bain (14:20):
  “Small brands might have their supply chain concentrated in one area and maybe even one factory.”

• Mark Bain (22:31):
  “If you want access to the Chinese market, you kind of have to play ball with the Chinese government.”

• Mark Bain (26:07):
  “We are not restoring American manufacturing of sneakers and clothing on any sort of mass scale in our lifetimes.”

---

For more in-depth analysis, listeners are encouraged to read Malik Morris's story, "How Made in America Brands Turned Tariff Turmoil into Opportunity," and an explainer on the US-China trade war's effects on the fashion industry available to BOF Professional subscribers.

---

This summary captures the key points and discussions from the episode, providing a comprehensive overview for those who have not listened to the full podcast.

Transcript

[Sheena Butler Young]

Hello and welcome to the Debrief from the Business of Fashion, where each week we delve into Our most popular BoF professional stories with the correspondents who created them. I'm senior correspondent Sheena Butler Young.

[Brian Baskin]

And I'm executive editor Brian Baskin. The Trump administration has offered up many reasons for imposing tariffs as high as 145% on goods imported from China. The two most relevant to fashion are that tariffs will revive American manufacturing and that they will stop a flood of cheap Chinese imports from undercutting American businesses.

[Sheena Butler Young]

Joining us today are BOF correspondents Malik Morris and Mark Bain, who have been looking into whether either of those theories are becoming reality. Hi, Mark and Malik. Welcome to the Debrief podcast.

[Mark Bain]

Hi, Sheena.

[Malik Morris]

Hi, Sheena. Hi, Brian.

[Sheena Butler Young]

So let's start with the basics. Malik, can you remind us what exactly are the tariffs that the Trump administration has proposed and how are those affecting the fashion industry right now?

[Malik Morris]

Yeah, it was actually been a bit of a roller coaster on Trump's Liberation Day on April 3rd, as I'm pretty.

[Brian Baskin]

Sure underplaying it there, Malik.

[Malik Morris]

But, you know, then Trump showed a chart with tariffs he would impose on goods imported from other countries. And not only were they astronomically higher than anyone expected, I mean, we were talking about like 46% for goods coming from Vietnam, 37% for Bangladesh, but they were targeting some of fashion industry's go to manufacturing hubs. And like, no one was spared, really. You know, even the EU was facing 20% tariffs, which would have curb spending in the U.S. you know, a market the luxury sector was is heavily leaning on for growth. But in true Trump fashion, those tariffs were delayed in favor of a 10% tariff for all countries, except, of course, China, which is subjected to more than 100% tariffs and has some retaliatory tariffs of their own. So most of the clothes sold in the US Come from China, so that's not great. Right? And I mean, there are very few brands that will be unaffected by this. You know, some have already been diversifying the supply chains out of China, but most still have tons of exposure there. So that's a bit of a mess to start with. But on top of that, on May 2nd, the Trump administration is actually axing this tax loophole called de minimis that lets brands import packages below the value of $800 without paying any duties. So the administration had teased a crackdown on that loophole in February, but the borders got so crazy sorting through products and instituting more rigorous clearance requirements that the Trump administration had to pause the end of de minimis. But that ban is back in full effect and that will impact really big brands like Shein, Tamu and even an up and coming brand, Quince, that's been doing gangbusters in numbers while potentially being a boon for others, which is a little more complicated. I'm sure we'll get into that later. But as you can see, there's a lot going on, a lot to account for that. You know, fashion has to figure out a way to navigate through.

[Sheena Butler Young]

And what kind of messaging is coming out of the administration around the value of this to US jobs, US Manufacturing? What is the headline? Why this is a good thing?

[Malik Morris]

Well, yeah, I mean, that is funny you bring that up because the goal here is pretty noble on the surface if you think about it. You know, the tabs are supposed to be about bringing manufacturing jobs back to the states and lessening the US reliance on foreign factories, but really, honestly, it's just forcing other territories to negotiate with the US as is the case with countries rushing to appease the administration to ward off the worst of the tariffs. But that level of negotiating via strong arming is something that China appears to have no desire to do. So now the economy is in jeopardy and there's no guarantee that the US will be able to revive its manufacturing prowess across industries, especially in apparel.

[Brian Baskin]

I think no guarantee is probably an understatement. I mean, something like 99% of clothing is imported from overseas, right? So what are the prospects that we could see more garment manufacturing coming to the US Assuming these China tariffs are sticking around.

[Malik Morris]

You know what's so interesting that I saw, I wrote a story recently about brands that actually make goods in the US and there's actually a surprising number of startups that have been making a lot of their goods in the US For a decade or more. I don't have an exact number, but I encountered close to a dozen that produce most if not all of their products in the US and some have been in business for over a century, managed to keep most of their supply chain domestic. Now, are we going to see a ton of brands being able to do that? Probably not, but there's a good chunk of them that already do. And those brands aren't feeling the same pressure to raise prices because they aren't importing finished products into the States. And many of them are importing at least some of their materials here, and that's a potential that they'll take a hit on margins there. But all these brands spoke to were not anticipating passing any jarring price increases on to their customers. But I think, you know, a big question too is consumer sentiment, which is already in the toilet because of tariff uncertainty. So really right now we're looking at brands that are already produced here that can tell the customer that they won't be raising any prices because the goods are made here could actually help them sustain, maintain sales growth in the US but in terms of how much manufacturing come back to the U.S. that's, I mean, I don't know how feasible that actually is, but there are a cohort of brands that are currently making it work in the States.

[Brian Baskin]

Well, just to start, I mean, what are some of those brands, what types of brands actually are able to manufacture in the US right now?

[Malik Morris]

Well, I spoke to this brand called American Giant. They do everyday apparel basics and a lot of their, I understand their product is, you know, cotton based things of that nature, which I know is grown here and sourced here. And also obviously denim brands. You know, for a very long time denim manufacturing has been huge in the.

[Brian Baskin]

US and la, but it's premium, right? I mean I'm looking at American giant. These are $55T shirts. The denim brands here tend to be $200 jeans. Right. We're not talking.

[Malik Morris]

Well, that's always the sticking point with consumers. And why these brands that manufacture elsewhere have risen so greatly is because the product, the prices are cheaper and the product that's made here is a little bit more expensive. So yes it is brands that are premium and you know, they have a locked in customer base. But a lot of those brands are still small and niche and a big challenge for them is going to be actually to get more consumers to care about the fact that products are made here and be willing to spend on those products and to grow their customer base as tariff uncertainty continues to unfold.

[Sheena Butler Young]

Yeah, I mean I think a lot of rhetoric says that brands should lean into this made in the USA labeling, but it's so politicized now. Is the there value in doing that when the conversations become so polarized, like could you really lean into that as a brand and expect to do well or does it feel like you're getting into politics now?

[Malik Morris]

That's the interesting part of all this, right? Like consumers don't rank a pair of ballet fats or silk blouses, country of origin super high when they're deciding on what they're going to buy. And right now, honestly a lot of them probably aren't feeling good about buying ballet flats or silk blouses from anyone. If the consumer sentiment indexes to, you know, taken into account here. So these American made brands, I said before, have to get people to care about where their products are coming from. And they also can't look like they're giving Trump's tactics a thumbs up either. So really what they have to do is put a spotlight on how making goods in the US Provides great value in terms of product quality, the rich storytelling it brings, and how it makes those items, the items they sell, unique. And you know, some brands already bake an American made sentiment into their content, but they have to make it romantic and cool.

[Brian Baskin]

And there's one brand that did this pretty effectively, which was Filson. Right? Tell us about them.

[Malik Morris]

Yeah, so Filson is this western wear brand. They're like favored by like the Yellowstone crowd, I call it, which, you know, not a knock is, you know, is a huge thing. You know, what a great story when Beyonce's Cowboy Carter's album came out about how that's just been taken off. But, you know, they have a manufacturing facility, this brand Filson, in their Seattle headquarters, actually in the same building as their flagship store there. So the brand is actually organizing, walking towards the factory where they'll shed light on the materials they make, you know, their classic goods with and how they've been doing that for over a century. And like, that ties into this experience factor of the physical retail playbook that consumers are really buying into these days. So it's not, you know, necessarily God bless America. You know, it's, it's, it's, look at these cool things we can do because we have this facility. And there's also the opportunity to shed a light on local makers. You know, like there's this online jewelry retailer that I spoke to called at present, and they mostly sell, you know, very intriguing accessories from American craftspeople, like you know, putting the story. There's like this $350 gold ear cuff that's made in Los Angeles. And you know, that brand has a sort of designer to know link very high up in their homepage on their online site that talks about the artisan, where and how they source their materials and what goes into creating those silhouettes. So, you know, fashion is already an emotional purchase and consumers do care about the story behind a brand. That's why brand marketing is so important for building a label. And this is another way to tap into that. You know, again, it's storytelling, not nationalism, you know, Now. Yeah, so I think that that's, those are some really, really interesting and I think effective ways that brands that make in the US can actually get consumers to care about that fact.

[Sheena Butler Young]

These are really amazing examples of, you know, brands that produce in the US and can lean into that a little bit, but there's just such a small number of them. Like, yes, there's proof of concept, but the infrastructure doesn't really support this happening at scale. Can you talk us through what infrastructure right now for manufacturing and where the potential can go from here? Because it doesn't seem like it can happen in, you know, five to 10 years or even our lifetime.

[Malik Morris]

No, it can't. But I think there's some important caveats. So, like, obviously making goods in the US hasn't been viable for most brands for decades. You know, first is more expensive because, of course, the labor is higher. Also, there aren't enough skilled workers in the US to support demand for making goods here. And you've had great stories about, like, retail, which I used to work in. Like, even getting young people to aspire to work in retail and not be an influencer is difficult. Imagine trying to get them to work in a factory. Right? You know, and the crackdown on immigration, which is a source for a lot of the current manufacturing labor, doesn't help. It's not clear how much of you get. The younger generation want to work in factories and make clothes. So, yeah, who knows if the ideal of manufacturing US is not only achievable or sustainable in the long term. But I think the benefits for the brands that do make here are fabulous. You know, firstly, the brands that do this are smaller and they don't have tons of volume to begin with, so they often make a smaller batch of items to test demand and they can produce more quickly once those pieces take off. And it's also easier to manage things like quality control if you can visit your factory partners often a couple times a week or a couple times a month rather than maybe once or twice a year or especially if you don't own at least one of your own facilities. So. And also, freight costs are lower because you're not importing it from another country. And they can avoid, you know, supply chain bottlenecks like those poor congestions and strikes that have bubbled up in recent years. But also, I think a big part of it is like, you get to be more nimble. Like, if you need to move manufacturing or supply chain, it's easier to do when you already produce goods in the state because you're more attuned to the best factories and suppliers in the states in a way that companies that have long been making stuff overseas may not be as tapped into. So yeah, I think that those are important considerations. Again, the reality of the majority of American brands being able to bring this back here has yet to be seen and it's probably a grim one. But I think more people can lean into this for sure.

[Brian Baskin]

We'll be back with more of the debrief right after this.

[Malik Morris]

Today's episode is brought to you by Nordstrom. If you're on the hunt for fresh on trend spring fashion that won't break the bank, then look no further than Nordstrom. They've curated the best of spring styles all under $100, so you can refresh your wardrobe and grab the latest. Must have sneakers and bags all from top brands like Levi's, skims, Nike and more. What's even better, Nordstrom makes shopping effortless with free shipping and free returns plus fast options like buy online, pick up in store and free two day delivery so you can shop confidently without any risk. Whether you're updating your workwear or searching for that perfect weekend outfit. Nordstrom is your go to destination this spring. Explore more in stores or [e-mail] or download the Nordstrom app.

[Kristen]

It's 2025 and you're wondering how can I make this year different? How can I turn my business idea into reality? Shopify is how. Shopify makes it easy to launch your brand, get your first sale and manage everything from shipping to payments all in one place. Don't wait, start building today and make 2025 the your idea becomes a reality with Shopify. Your first sale is closer than you think. Established in 2025. Has a nice ring to it, doesn't it? Sign up for your $1 per month trial period at shopify.combof all lowercase go to shopify.combof to start selling with Shopify today. Shopify.combof hi, this is Kristen and Jen from Imomsohard and we're here to tell.

[Brian Baskin]

You about Wild Grain.

[Sheena Butler Young]

Wild Grain is the first bake from.

[Malik Morris]

Frozen subscription box for artisanal breads, pastries.

[Kristen]

And pastas that you can bake in 25 minutes or less with no mess or cleanup.

[Malik Morris]

Are you ready to bring all your.

[Sheena Butler Young]

Favorite carbs right to your doorstep?

[Malik Morris]

Jenny Yum.

[Kristen]

For a limited time, Wild Grain is offering our listeners $30 off the first box plus free croissants in every box when you go to wildgrain.com imom to start your subscription.

[Brian Baskin]

Ryan Reynolds here from Mint Mobile. I don't know if you knew this, but anyone can get the same Premium Wireless for $15 a month plan that I've been enjoying. It's not just for celebrities. So do like I did and have one of your assistant's assistants switch you to Mint Mobile today. I'm told it's super easy to [e-mail].

[Kristen]

Switch upfront payment of $45 for three month plan equivalent to $15 per month required. Intro rate, first three months only, then full price plan options available, taxes and fees, extra fee, full [e-mail].

[Brian Baskin]

Mark, let's bring you in here and talk about the other side of this trade war, which is Chinese manufacturing. The brands that are relying on that for their business. And from what I understand, there are a handful of brands that are just being absolutely clobbered by the particular dynamics of what has been unfolding this past week. Tell us about those.

[Mark Bain]

There are a lot of small brands that depend really heavily on China for their manufacturing. When you think about like a diversified supply chain, it's typically these really large brands like Nike and Adidas and, you know, these multinational corporations, small brands might have their supply chain concentrated in one area and maybe even one factory. And so if that's the case, if that area happens to be China, that factory happens to be China. And suddenly there's this giant, you know, more than doubling of tariffs, you are in serious trouble. And it's already tough for big brands. If you're a small brand, it's really not easy to just pivot and be like, all right, well we're going to just do this in Vietnam now or wherever else. You know, kind of like what Malik was talking about. With the lack of infrastructure in the U.S. china is the exact opposite. And that's part of what's kept manufacturing there consistently. Why it makes it hard to leave China is like they have all the infrastructure set up and like right nearby. If you're a small brand, again, you might be manufacturing in a factory. If you need zippers or buttons or whatever inputs, those things might be like literally down the street. It's not something that you have to worry about, importing, shipping back and forth, that sort of thing. So, yeah, small brands in particular are in some serious trouble at the moment.

[Brian Baskin]

And a lot of them wouldn't be able to even find a factory that would take their business in other countries. Right?

[Mark Bain]

Yeah. So those factories in places like Vietnam, a lot of them are set up to serve those big brands that we talked about. And they might have order minimums that are like 10,000 pieces or more. That is just a huge amount. Like if you're a small brand. I worked for a small brand that made everything in the US we'd have some orders that were like 50 pieces, 100 pieces, 300 pieces. You could not go to a factory in Vietnam and ask them to make that. They would just laugh at you. One of the things that's actually also made China attractive for small brands is they have a pretty big array of factories serving different sizes of brands. And you can actually find factories that will produce smaller order quantities. You know, one of the things, like if you're a small brand in the us you can go on Alibaba and find a factory pretty easily that can produce maybe 300 or 500 pieces for you.

[Brian Baskin]

So what are these brands going to do?

[Mark Bain]

They don't know. Like everyone, everyone I talk to is like they're just freaking out. Everyone is scrambling, trying to figure out what's happening. I was talking to Joe Eng, the founder and CEO of Shift Fashion Group, which is a studio that helps brands with product development and manufacturing. And he was saying that they work with brands of all different sizes. And everyone is just kind of panicking right now. And what some brands have actually done. There were some brands that were going to, their plan was to put stuff on planes and send it out to the US for a product launch. Now they're actually loading it onto ships because they're hoping. Hope is that even though it takes a lot longer to get to the U.S. maybe the tariffs will be gone by the time it actually hits U.S. ports. So nobody really knows exactly how to get around it other than, you know, some brands are just going to have to eat the costs.

[Brian Baskin]

That's the pray and hope it works out approach. Basically, yes.

[Sheena Butler Young]

I actually have seen some brands on social media, like preemptively, like really small ones announced that they're going to just shut down. I don't know if you all have seen this. Like, it's like a kids brand that makes stamps so you can put your name on your clothes. One of their messages recently on Instagram was, we're just going to preemptively shut down because we know we can't sustain and even the uncertainty right now means we can't find a path forward. We've talked a lot about the brand side. There's also a consumer side to like, if you're used to getting your two dollar T shirt or your ten dollar denim and you can't get that anymore, what are you going to do? Is there other, are there other brands consumers are going to be able to turn to here in the US I think the answer is probably no. But is there another place to find cheap, cheap clothing if these towers stick? No.

[Mark Bain]

Yes, but it might be different clothing like in, you know, I don't, I don't know how much the price of something from Shein would go up necessarily. I haven't seen like a, a specific breakdown of that. It would still be really cheap, you know, so it might still be your best option. You might also end up going to Walmart or Costco, places like that instead. If you're looking for basics like I, I don't see why people wouldn't turn to those places. They already shop at them a lot. But the reality is prices are probably just going to go up and people will probably just spend less.

[Malik Morris]

I think the hope here really is that people will just stop desiring to buy those $10 jeans and $2 tees. And this idea of, especially when they're middle class consumers, that they'll, even if they're not going to buy American made brands that are significantly more expensive, maybe they'll go secondhand, maybe they'll go vintage. And there's obviously a sustainability piece to all this. I'm pretty sure those advocates would love nothing more than, you know, the minimis to go away and for Shein and Tae Mu to implode for those reasons as well. So, you know, it's not necessarily just like what is a one to one alternative. I think the hope here is that people would just get conditioned out of thinking that they can get $2 jeans and you know, a $10 dress.

[Brian Baskin]

Let's talk though about Shein and Teemo. I don't think we've really unpacked just how almost surgically targeted a lot of these measures the US has imposed on China are on their business model.

[Malik Morris]

Yeah, I mean, you know, that's a very specific nail going to a very specific coffin for this very fast growing ecosystem. And you know, in fashion and you know, again, is it sort of this death blow to dupe brands that we had written about earlier and you know, with Shein and Temu and even, you know, Quince as well, like they drop ship imitations of luxury products directly from factories in China to consumers in the US and so I think how bad it's going to be obviously remains to be seen. But I think a big sticking point is going to be diversification. I know from what I understand in reporting I've done, you know, Quint already makes things in other countries outside of works of factories and countries outside of China. And you know they've claimed to use de minimis for a very small portion of the goods that they import. But she and Timu are Chinese companies and they have, you know, very robust supply chains in China. So how quickly they can diversify or if they can at all is really not clear. But this will cause all of them to raise their prices even if they start working with factory outside of China. The proposition of selling luxury dupes at rock bottom prices is definitely compromised. So you know, it's going to be a wait and see in terms of like how they react to this. But you know, I will say that the end of the minimus could be good for, and we've written about this before as well for like these mid price brands that were getting squeezed by the ultra fast fashion players and by the really ultra luxury players who were kind of sit in the middle. Now some of these brands go Quint, you know, they compare their, their prices to some of these mid price brands like a Todd Snyder. And you know, theoretically speaking if the new brands have to raise their prices then there goes their differentiation and you know, they haven't really built brand independent of their pricing. So sexy names like a Todd Cider could win even more middle class customers who can afford at least one or two pieces a year rather than 20, you know, and really sort of like investing in that whole buy less buy better theory as well.

[Brian Baskin]

The one hang up on that is I believe Todd Snyder and most of the brands you're talking about also make a lot of their clothes in China. So they're not exactly.

[Malik Morris]

They do, yes. They're not not exactly exact but in terms of, you know, the de minimis portion of it, you know, there's one.

[Brian Baskin]

Other element here that you briefly touched on there which is, you know, whether she and can move its supply chain out of China. And there's. That's an open question because Bloomberg reported last week that China's government was actually discouraging Shein and presumably other major garment manufacturers from leaving China. I'm sure they don't want many thousands of workers put out of their jobs as a result and that's a big factor there. But Mark, can you tell us what is the role that China's government could play in applying pressure both on the brand I mentioned and on American brands that are selling in China.

[Mark Bain]

So China's government doesn't really hold back in sort of inserting itself in these matters. I think we've seen that with TikTok for instance. The TikTok deal really depends on whether or not the Chinese government is going to allow ByteDance to sell TikTok. And so similarly, you know, if you're a business that is in China, you kind of have to listen to the Chinese government. But even US businesses that sell in China sort of have their own version of this China. You know, for instance, when PVH Core, you know, the company that owns Tommy Hilfiger and Calvin Klein talked earlier this year about like not using Xinjiang cotton, which, you know, has been the subject of accusations of forced labor by, you know, the Uyghur population in China, China did not take kindly to that and actually added PVH to this, what it calls an unreliable entities list, which allows China to restrict its business in the country. TBH has said so far that they haven't actually enacted any measures that are limiting them. But it's a very real thing where it's like if you want access to the Chinese market, you kind of have to play ball with the Chinese government.

[Brian Baskin]

There seems to be at least one Chinese handbag manufacturer who is loving this. Malik, tell us about Sendbags.

[Malik Morris]

Yeah, so from my understanding, there's this clip from a TikToker named Sendbags who from my understand, manufactures handbags in China going viral, basically teasing the fact that a lot of the high end bags that consumers love to buy from, brands that are not based in China obviously actually are made there and saying, you know, hey, the things that you buy elsewhere that are made here, we can make here without actually dealing with the luxury brands. Now if that's, you know, the glorifying counterfeits or what have you that I'm not clear on. But it definitely is sending a message of we don't need your participation to sell products that are yours or look like yours, which is pretty jarring and alarming. Again, I could be misinterpreting that, but that is what it seems like from this TikTok that has now gone viral.

[Brian Baskin]

I just love that trade policy is going viral on TikTok. I think that's just great.

[Malik Morris]

Well, I mean, it showed that it is top of mind not just for fashion to shine insiders, but for casual consumers as well. So story of the year, I was.

[Mark Bain]

Talking to this agency that works with a lot of American and European brands in China. It's the stuff that's in the story. And he was talking about how it's just jokes and memes. It's like, it's not even like real anger directed at the US right now. It's a lot of just like, you guys can't be Serious. Right.

[Sheena Butler Young]

I wanted to bring it back to sort of the one of the original premises of this episode, which is the long term play of Made in America. Like, are we really any closer to this being a reality of being, you know, there being robust manufacturing of clothing and footwear here and people buying it? What is the final verdict on that?

[Malik Morris]

It's ever changing. But I think the immediate verdict on that is no, that that does not seem like an immediate reality either for the jobs to come back or that consumers are going to care. But obviously that's just another challenge for the industry to take on. I mean, obviously their hands have been forced in taking it on, but it's again, it's a. So we'll have to. We'll have to see sort of approach and obviously I'll be monitoring it very closely in terms of how brands are going to respond. Those who already manufacture here and those who are maybe thinking about doing so.

[Mark Bain]

So I've talked to the heads of a bunch of trade groups like the American Apparel and Footwear association, footwear distributors and retailers of America and they say just flat out they're like, it's not coming back. Like, we are not restoring American manufacturing of sneakers and clothing on any sort of mass scale in our lifetimes. The circumstances for this to actually work and happen are like, it's just not a realistic thing unless we wall off the country so much from other nations in trade that you don't really have a choice but to buy American. But even so, as Malik talked about, the infrastructure just literally isn't here. Say even half the people manufacturing in other countries right now wanted to reshore their stuff to the US and even assume the higher labor costs and all that. They literally couldn't. There just isn't the factory capacity. And not to mention all the other stuff. Even if you use US grown cotton, most of the time that cotton is shipped out of the US to be spun into yarn and woven into fabric somewhere else. These are all sorts of things that we just don't have that here. It's been lost over decades and it would take decades to get it back. And to the point that you both were making earlier, like Americans don't say they really want those jobs. I think there was a poll in the Financial Times this weekend where it was like more than 80% of Americans say that like reviving manufacturing in the US would be a great thing and only like 20% said that they would want to work in a factory.

[Sheena Butler Young]

Don't you love data like that? Yeah. So it's a negotiating tactic that so far we are not winning against China.

[Brian Baskin]

Well, I think we're not winning in the sense that manufacturing isn't coming here, but I think these tariffs could push a lot of fashion manufacturing out of China. So we could win by hurting China even if we don't win by reviving American manufacturing.

[Mark Bain]

I think the tricky part there is there's not as clear a picture of where to go at this point. A lot of brands have diversified to places like Vietnam and Indonesia and Cambodia over the years, and the returns on that are shrinking. As those countries mature, their labor costs go up and again, there isn't the same sort of infrastructure built up there. So brands are now looking to places like Pakistan, parts of Africa, like Ethiopia. But it's definitely challenging. Again, leaving China is just not a really easy thing to do.

[Sheena Butler Young]

I don't think this is one of these episodes where we can end on a positive note. I think that we can end it there. Thank you, Malik. Thank you Mark, so much for joining us today. This was so insightful.

[Malik Morris]

Thank you for having us. Thank you.

[Mark Bain]

Thanks. Always enjoy being here.

[Brian Baskin]

You can read Malik's story, how Made in America Brands Turned Tariff Turmoil into Opportunity, as well as an explainer from Malik and mark on the U.S. china trade war and how it affects the fashion [e-mail] those stories and others are available to BOF Professional subscribers and we'll include a link in the episode notes. You've been listening to the debrief, produced and edited by Olivia Davies and Eric Brea. I'm Brian Baskin.

[Sheena Butler Young]

And I'm Sheena Butler Young. Thanks so much for listening and we'll see you next week.

[Kristen]

This podcast is brought to you by Aura. Imagine waking up to find your bank account drained, bills for loans you never took out, a warrant for your arrest, all because someone stole your identity. Hackers aren't waiting. Why are you? That's why we're thrilled to partner with aura. Your personal data is a goldmine for hackers, and Aura helps lock it down. Aura monitors the dark Web, blocks data brokers from selling your information. Includes a VPN for private browsing and a password manager to secure your accounts before criminals break in. For a limited time, Aura is offering our listeners a 14 day free trial plus a dark web scan to check if your personal information has been leaked, all for [e-mail] safety. That's Aura.com safety to sign up and start protecting yourself and your loved ones. That's a U r a.com safety terms apply. Check the site for details.

[Mark Bain]

Your customers are scrolling past your social ads, using ad blockers and paying for ad free streaming. But when they're listening to a podcast, they're hearing Acast ads, which are 4.4.

[Brian Baskin]

Times more engaging than with display ads.

[Mark Bain]

So if you want real attention, start advertising on podcasts with Acast.

[Brian Baskin]

Start [e-mail] ads.