Sales Growth Picks Up Pace Month Over Month

Consumer spending edged higher by 0.28% compared to August and climbed 4.05% year over year, both figures representing a modest acceleration from August’s gains of 0.22% month-on-month and 3.87% year-on-year. The continued momentum in US retail sales growth signals that shoppers, while cautious, have not pulled back from spending altogether.

NRF President and CEO Matthew Shay noted that retail sales rose again as consumers continued to spend following a solid back-to-school shopping season. He added that households remain budget conscious, concentrating on everyday essentials even as higher gasoline prices continue to absorb a larger share of family budgets. Shay also noted that retailers have continued to prioritise affordability, leaning on promotions and value pricing to keep everyday products within reach.

Core Retail Sales Reflect Similar Trend

The Retail Monitor’s calculation of core retail sales — which strips out restaurant, auto dealer, and petrol station transactions — came in at $453.1 billion in September. This represented a 0.27% increase month over month and a 3.73% rise compared to the same period last year. For context, August’s core figures showed smaller gains of 0.17% month over month and 3.47% year over year, pointing to a modest but visible acceleration in consumer spending activity.

Mixed Performance Across Retail Categories

Performance across retail categories was varied. Clothing and accessories sales totalled $41.9 billion, reflecting a 0.48% increase from the prior month and 2.21% growth on a year-over-year basis.

Electronics and appliances stood out as the strongest-performing sector, posting an impressive 8.41% year-over-year growth, defying the broader consumer pivot toward everyday essentials. On the other end of the spectrum, furniture and home furnishings was the only major sector to record a year-on-year decline, falling by 2.7% compared to September of the previous year.

Updated Methodology Debuts with September Data

September’s figures also mark the introduction of a revised methodology for the CNBC/NRF Retail Monitor. The updated approach is now based on spending patterns drawn from approximately 120 million debit and credit cards, with results adjusted to reflect the demographic makeup of US consumers and aligned with US Census Bureau retail sales totals. This change is aimed at enhancing the accuracy and representativeness of the monitor’s retail sales data going forward.

With US retail sales growth holding steady for a full year and consumer spending continuing to hold ground despite macroeconomic headwinds, the data underscores the resilience of American shoppers even as they remain firmly focused on everyday essentials and value-driven purchasing decisions.

From consumer expectations to textile performance

Consumers today expect more from textiles than ever before. Performance apparel,
outdoor garments, and technical textiles must remain comfortable, functional, and
reliable throughout repeated wear and use. Freshness, weather protection, and longlasting performance have become essential factors that influence purchasing decisions as well as the overall perception of product quality.

Recognizing these evolving expectations, SANITIZED and RUDOLF continue to develop
technologies that address real-world challenges faced by brands and consumers alike.
Their latest innovations are designed to enhance the functional value of textiles by
improving comfort, protection, and wearability over time.

Freshness that goes the distance

Performance apparel is exposed to repeated cycles of wear, perspiration, weather
exposure, and laundering. Over time, these influences can impact how consumers
perceive a garment’s performance and comfort, even when the textile itself remains
physically intact.

Persistent odor is one of these challenges. Sebum and odor-causing residues can
accumulate on textile fibers over time, contributing to long-lasting odors that may remain
even after washing. This phenomenon, often referred to as “permastink”, can limit the
continued wearability of otherwise functional garments.

With Odorex™ EON, SANITIZED introduces a biocide-free Dual-Action Technology
designed to address this challenge. During wear, the technology adsorbs and neutralizes
odor molecules, helping textiles maintain a fresh feel. At the same time, Odorex™ EON
creates a protective layer that supports the removal of sebum residues during
laundering, helping to prevent the gradual buildup associated with persistent odor.

By addressing both immediate odor and long-term odor accumulation, Odorex™ EON
contributes to a broader understanding of durability. Beyond physical properties such as
strength or abrasion resistance, functional durability also means ensuring that garments
remain comfortable, wearable, and desirable throughout their lifecycle.

“Durability is often discussed in terms of physical properties such as strength or abrasion
resistance. But a garment that is technically intact has little value if persistent odor
means it is no longer worn,” says Stefan Müller, Head of BU Textile Additives,
SANITIZED AG. “With Odorex™ EON, we are broadening the conversation around
durability by addressing one of the factors that can affect a garment’s continued
wearability.”

Built for lasting performance in challenging conditions

Another key factor influencing long-term wearability is reliable protection against
moisture and exposure to the elements. Complementing SANITIZED’s latest innovation,
RUDOLF introduces RUCO-DRY® ECO CWS: a high-performance, water-repellent and
waterproof technology which can be marketed under the globally recognized BIONICFINISH® ECO brand. This technology combines advanced water repellency with
excellent hydrostatic pressure resistance for cotton fabrics, helping textiles maintain their
protective function in challenging conditions.

Designed for applications such as outdoor apparel, technical textiles e.g. tents, awnings,
and umbrellas, RUCO-DRY® ECO CWS supports durable weather protection while
meeting the performance expectations of modern consumers.

Together, the innovations presented by SANITIZED and RUDOLF highlight different
approaches to extending textile performance and supporting the long-term functionality
and desirability of garments and textile products.

“In technical textiles, durability is measured by performance under real-life conditions.
Whether used in tents, outdoor equipment, or other demanding applications, materials
must provide reliable protection against rain and moisture throughout their service life.
With RUCO-DRY® ECO CWS, we offer a solution that combines durable water
repellency with outstanding hydrostatic pressure resistance, helping manufacturers
create weather-resistant textiles that are built to last.”

– Luka Kovacevic, Global Head of Application Center Technical Textiles at RUDOLF.
Odorex™ EON will be officially launched at Performance Days Munich, October 13-14,
2026. Visitors can discover the new technology at the SANITIZED booth: Hall A6, Booth
C05.

The alert, titled “Asos hacked”, alleged that attackers had accessed the retailer’s Snowflake data environment and threatened to disclose information. It directed recipients to a Telegram channel associated with a group calling itself Xuanye Group.

ASOS said some customer information, including names and contact details, may have been accessed. However, the company did not believe payment card details or account passwords had been compromised. Its website and app continued operating normally.

The retailer said: “We are investigating unauthorised activity involving third-party platforms that we use to communicate with customers. We took immediate action to restrict access to the notification platforms and are working with our internal and external specialist advisers, as well as all relevant authorities.”

The incident triggered a sharp decline in ASOS shares, which closed 9.56% lower after falling more than 14% during trading. The UK’s National Cyber Security Centre offered assistance as investigations continued.

Cybersecurity specialists also warned customers to remain alert to phishing attempts, including fraudulent messages requesting password resets, payment information or order verification.

The incident highlights the risks fashion retailers face when customer communication systems are compromised, potentially undermining consumer confidence even when their core shopping platforms remain accessible.

According to the report, when a garment fails, consumers are 12 times more likely to walk away from the brand entirely than to replace the item with the same brand. Despite this, only 5.9 per cent of customers actually return the faulty item, which means the brand rarely receives direct feedback about the failure.

The report draws on insights gathered from over 5,000 globally surveyed, circular-conscious consumers — predominantly from Gen Z — on their expectations around material quality, transparency and circularity in fashion.

The True Cost of Garment Failure: Invisible Churn

What the data makes clear is that garment failure doesn’t just damage a sale — it silently erodes a brand’s customer base. When a garment disappoints, more than 1 in 4 consumers (27.7 per cent) leave the brand altogether. Of these, 15.8 per cent say they will never buy from that brand again, while 11.9 per cent actively switch to a competitor.

Rather than engaging with the brand over the issue, the majority of consumers quietly absorb the loss: over 64 per cent either repair the item themselves or continue wearing it despite the defect. Only 2.3 per cent choose to replace it with the same brand — a figure that underscores just how deeply brand abandonment outpaces brand loyalty in the face of quality failures.

What Frustrates Consumers Most

When it comes to the specific types of quality failures that bother consumers most, the issues are almost entirely material in nature. Fabric thinning or developing holes ranked at the top of the frustration list, cited by 62 per cent of respondents. Seams splitting or unravelling followed at 55 per cent, with fabric pilling close behind at 50 per cent.

These figures point directly to garment durability as the central concern — not aesthetic faults or sizing issues, but the structural and material integrity of what consumers are buying.

Transparency and Proof Matter More Than Certification

Over 80 per cent of respondents stated that knowing what their clothing is made from is important to them. However, when asked what would most increase their confidence that a garment is genuinely better made, independent certification came in last among five options, chosen by just 6.6 per cent of respondents.

Instead, material information and evidence of how a garment holds up over time together accounted for 63 per cent of first-place votes — indicating that consumers value real, demonstrable proof of quality far more than labels or accreditations.

Durability at the Heart of Circular Fashion

Samsara Eco’s General Manager, Dr Lars Kissau, addressed the link between garment durability and circular fashion directly.

“Circularity means keeping materials in circulation at their highest possible value — not their lowest available use,” Dr Kissau said. “That’s why durability matters so much. A garment has to last to be worn again, resold, handed on. And when it genuinely can’t be worn any longer, it should become clothing again, not something lesser. Downcycling only slows the linear model. It doesn’t stop it.”

Dr Kissau also noted that garment durability has moved beyond being purely a quality question. “It’s now a retention question, and in Europe it’s becoming a compliance one — both showing up on the bottom line. Durable products can be made from recycled materials — there’s no trade-off in quality or performance. That’s what unlocks a truly circular textiles industry.”

Cost of Living Is Shifting Buying Behaviour — But Not Standards

The report also found that broader economic pressures are reshaping how consumers shop for clothing, even as their expectations around quality remain high. Over 88 per cent of respondents said the cost of living has influenced how they purchase clothes.

Of those, 1 in 3 said cost-of-living pressure has led them to buy less and expect more from each item they do purchase. Meanwhile, 43 per cent reported turning to second-hand shopping, and 13.9 per cent said they are now choosing cheaper options.

The data suggests that while economic pressures are reducing spending frequency, consumer expectations around what a garment should deliver — in terms of garment durability and performance — have not softened.

Brands Are Being Held Accountable

On the question of responsibility for quality, consumers are pointing firmly at brands. Over half of all respondents — 54 per cent — say quality is the brand’s responsibility, nearly double the 27 per cent who attributed it to government regulation. Just under 9 per cent placed responsibility on consumers themselves to buy less and better.

The vast majority of respondents — 89 per cent — also said they expect a garment to last at least 30 wears before it is considered worn out, reinforcing the role that consumer expectations now play in shaping what brands must deliver when it comes to garment durability and overall product standards.

As garment failure continues to fuel silent brand abandonment across the fashion industry, the message from consumers is consistent: quality, transparency, and longevity are no longer optional considerations — they are baseline expectations.

For the fiscal year ending in August, Fast Retailing’s sales climbed nearly 17 percent to just under 4 trillion yen — approximately $25.3 billion — while net profit surged 25 percent to a record 542.5 billion yen. H&M, which currently holds the second position in the global apparel industry behind Inditex’s Zara, reported weaker sales for its own fiscal year ending in November, raising the real possibility that Fast Retailing could leapfrog the Swedish retailer. Exchange-rate fluctuations, however, may still influence the final industry rankings.

“Fast Retailing is finally going to overtake H&M,” said Takahiro Kazahaya, a senior analyst at UBS Securities Japan.

Uniqlo’s Overseas Business Powers the Growth

The primary engine behind these Fast Retailing record sales was Uniqlo’s international operations. Overseas sales rose 26 percent, while overseas profit climbed 44 percent during the same period.

“We’re seeing a global boom,” said Tadashi Yanai, Chairman and CEO of Fast Retailing, at an October 8 press conference.

This past year, Uniqlo opened flagship stores in Seoul and Chicago as part of its ongoing strategy to strengthen its presence in key global cities and boost online sales. The brand’s appeal in Western markets has been supported by a notable shift in consumer behaviour.

“In Europe and the U.S., consumers who previously bought more expensive clothing are increasingly looking for reasonably priced alternatives,” said Kuni Kanamori, a senior analyst at SMBC Nikko Securities. “Uniqlo’s simple products, commitment to quality, and balance between value and price are meeting that demand.”

The Gap With Inditex and the Road Ahead

Even as Fast Retailing narrows its distance from H&M, the global apparel industry’s undisputed leader, Inditex — the Spanish owner of Zara — remains well ahead. Inditex posted sales of approximately 7.1 trillion yen in its fiscal year ending in January, compared with Fast Retailing’s 3.96 trillion yen for the year ending in August.

Yanai has publicly stated his long-term ambition of reaching the top position in global apparel for many years. “We’ve reached the point where our long-held goal of 10 trillion yen is coming into view,” he said.

Kazahaya sees the competitive landscape evolving into a two-player race at the very top. “We are entering an era led by two giants: Inditex, which quickly captures trends and sells high-quality, affordable clothing, and Fast Retailing, which specialises in highly functional apparel with basic designs,” he said.

Room to Grow in Key Markets

Fast Retailing maintains that there remains considerable room for international expansion. While Uniqlo commands roughly 12 percent of the apparel market in Japan, its share in Europe and North America stands at only around 0.5 percent — a figure the company sees as a significant opportunity rather than a limitation.

Questions Around the GU Brand

As Fast Retailing sets its sights on closing the gap with Inditex, some analysts have pointed to GU, the group’s lower-priced label, as a potential challenge to navigate.

Although GU posted higher sales and profit for the fiscal year ending in August, its operating profit slipped into negative territory during the June-to-August quarter. Takahiro Saito, president of consulting firm Demand Works and author of “Uniqlo vs Zara,” noted that GU’s global identity remains less defined compared with Uniqlo’s well-established brand recognition.

“With its previous lineup, it was difficult to differentiate its products from local competitors overseas in terms of design and price,” Saito said.

GU underwent a major brand overhaul this year, but Saito expressed concern that its higher-priced items are becoming increasingly prominent. “If that ends up hurting domestic sales, that will defeat the purpose,” he said.

Fast Retailing Forecasts Another Record Year

Despite the complexities around GU, Fast Retailing is projecting continued record-breaking performance. The company forecasts sales of 4.45 trillion yen and net profit of 560 billion yen for the fiscal year ending August 2027.

“From here, sales will grow by about 500 billion yen every year,” Yanai said. “A company with 500 billion yen in sales would be a giant in the apparel industry, and we’re talking about creating one of those every year through growth. The world has that kind of potential, and I believe our products will be accepted globally.”

With Fast Retailing record sales continuing to climb and Uniqlo accelerating its international footprint, the group is clearly positioning itself for a sustained rise in the global apparel rankings — with the No. 2 spot now within reach and an eye firmly set on the top.

Three Fibers, One Collection

At the heart of the REMOD Collection are Lenzing’s three signature fiber offerings developed specifically for denim applications: TENCEL™ Lyocell Standard, TENCEL™ Lyocell – HV100, and TENCEL™ Lyocell dtex 2.2. Each fiber brings a distinctly different hand feel, texture, and visual character to the table, offering a broad creative palette within a single fiber family.

TENCEL™ Lyocell – HV100 draws its character from Variocut technology, which introduces deliberate variations in fiber length. The result is a subtle irregularity in surface texture and a matte, more opaque appearance that closely echoes the look and feel of cotton — making it a natural fit for premium denim applications where authentic cotton aesthetics are valued. This fiber plays a prominent role across multiple pieces in the REMOD Collection.

TENCEL™ Lyocell dtex 2.2, featuring a 51mm fiber length, is coarser than standard TENCEL™ Lyocell. It delivers a drier, stiffer touch and a natural slub pattern that is reminiscent of linen — lending body and structure to fabrics without adding unnecessary weight. This characteristic makes it particularly suited to garments that must hold their shape through repeated wear and washing cycles.

TENCEL™ Lyocell Standard, meanwhile, contributes softness, fluid drape, and color depth. Explored across diverse blending options within the collection, it rounds out the portfolio by adding a refined, comfortable quality to the fabrics it is incorporated into.

A Collection Built for Exploration

The REMOD Collection spans a carefully considered range of denim garments, including heavyweight men’s jackets, mid-weight wide-leg jeans, stretch jeans, and cotton-free casual shirting. The range covers constructions both with and without cotton, unlocking a wide array of fiber-blending possibilities. Together, the pieces pair the authentic look of cotton denim and the craftsmanship associated with Japanese denim-making with an elevated hand feel and enhanced comfort.

Dennis Hui, Global Business Development Manager for Denim at Lenzing, spoke about the partnership: “TENCEL™ fibers have been part of Kaihara’s collections since the 1990s and every chapter has asked something different about the material. What makes this latest REMOD Collection especially exciting is how each fiber is celebrated in various applications as a discovery of what is possible with each TENCEL™ Lyocell fiber type. From our cotton-inspired TENCEL™ Lyocell – HV100 showcased across a variety of pieces within the collection, alongside TENCEL™ Lyocell Standard used in others. Meanwhile, our linen-inspired TENCEL™ Lyocell dtex 2.2 features in its own distinct articles. Each brings authentic denim character with elevated comfort and hand feel.”

Akihiro Maehara, Director of the Market Planning Division at Kaihara Corporation, also commented on the collaboration: “Texture is one of the most defining elements of premium denim, shaping both its character and visual appeal. For this collection, we harnessed the unique attributes of each TENCEL™ Lyocell fiber type to add value to the denim in distinct ways, creating fabrics that balance authentic denim aesthetics with softness, drape and comfort. We are proud to bring our longstanding manufacturing expertise together with the new material possibilities offered by Lenzing to explore new expressions of texture and visual depth.”

TENCEL™ Lyocell – HV100 Mill Network Reaches Third Cohort

Alongside the debut of the REMOD Collection, Lenzing announced the third cohort of its TENCEL™ Lyocell – HV100 mill partner network at Kingpins Amsterdam 2026. The fiber, which first launched at Kingpins Amsterdam in October 2025 with 17 mills across five countries, has grown steadily since then. By April 2026, the network had expanded to 37 mills across nine countries. With the addition of the third cohort, the network now stands at nearly 50 mills spanning 13 countries — and for the first time, Indian mills have joined the partnership.

This expansion into India brings a significant sourcing hub with deep denim heritage into the TENCEL™ Lyocell – HV100 ecosystem, adding both manufacturing expertise and fresh creative perspectives to the network.

One aspect that mills continue to highlight about TENCEL™ Lyocell – HV100 is its compatibility with existing operations. The fiber works with machinery, process steps, and chemicals already in use, meaning partners can broaden their fiber options without the need for additional capital investment. Each new mill that joins the network brings a different interpretation of the fiber, contributing to the ongoing expansion of what the TENCEL™ Lyocell – HV100 offering can deliver.

Predictability as a Competitive Advantage

Tuncay Kılıçkan, Head of Global Business Development for Denim at Lenzing, spoke about what drives brands toward TENCEL™ Lyocell – HV100: “Brands want more choices in how they create denim, but they also want confidence in the materials and partners they work with. Planning a denim programme means committing months ahead, so a material that behaves predictably — in supply, in processing, in how it wears — is worth a great deal. TENCEL™ Lyocell – HV100 gives brands that, while preserving the authenticity, timelessness and comfort that make denim a wardrobe staple. A year on, close to 50 mills have already brought the fiber into their products, which means a brand can explore a broader material palette for future collections and know where to source it.”

Kingpins Amsterdam 2026: Where to Find Lenzing

The REMOD Collection will be on display at Lenzing’s Booth 19 in the yellow zone at Kingpins Amsterdam, running October 14–15, 2026. Alongside the REMOD Collection showcasing TENCEL™ Lyocell fibers in denim innovation, Lenzing will also present a broader selection of its latest fiber products and offerings at the event.

For mills, brands, and designers exploring sustainable denim options and the expanding world of specialty Lenzing fibers, Kingpins Amsterdam 2026 presents a direct opportunity to engage with the full TENCEL™ Lyocell fiber portfolio and the creative possibilities it enables.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president has acknowledged the shift, noting that buyers are increasingly spreading their sourcing across multiple countries rather than depending on a single supplier nation. For Bangladesh, this is more than a routine adjustment. Once buyers begin factoring country-level risks more heavily into their sourcing decisions, cost competitiveness and product quality alone are no longer enough to hold business.

LDC Graduation Adding Uncertainty to an Already Shifting Landscape

One of the key risk variables buyers are reportedly weighing is Bangladesh’s scheduled graduation from Least Developed Country (LDC) status. Bangladesh remains on course to graduate on November 24, 2026, although the government has sought a three-year deferment and the process remains pending.

The uncertainty carries real weight. LDC trade preferences are central to Bangladesh garment exports’ competitiveness in several major export markets. But graduation does not produce the same outcome across all markets, which means buyers must assess not only the timing of graduation but also the specific tariff treatment that follows in each market where they source from Bangladesh.

The EU Trade Equation

The European Union remains the most critical market in this equation. Bangladesh will retain Everything But Arms (EBA) duty-free preferences for three years after LDC graduation, meaning there is no immediate cliff-edge loss of access. However, that three-year buffer is a window, not a permanent resolution.

Within that same window, competition is intensifying. Vietnam already holds an EU free trade agreement. The EU and India concluded negotiations on their own FTA in January, with most tariffs on Indian textiles and apparel expected to be removed once the agreement takes effect. Bangladesh shipped an estimated €19.41 billion (approximately $21.8 billion) worth of apparel to the EU in 2025, accounting for 21.57 per cent of the bloc’s total apparel import market — a scale that makes the comparison with India and Vietnam impossible to ignore. European buyers are steadily gaining more preferential sourcing options, while Bangladesh’s post-EBA trade position remains unresolved.

Energy Disruptions Compounding the Sourcing Risk Picture

Adding urgency to an already complex picture, a recent gas shortage disrupted industrial production across Bangladesh and affected shipment schedules at a particularly sensitive time. Industry groups reported order cancellations and reductions as factories struggled with interrupted supply. One industry survey reportedly found that 55 per cent of surveyed knitwear factories experienced reduced or cancelled orders during the disruption, 78 per cent faced partial production shutdowns, and 87 per cent encountered shipment delays. Factories also reportedly incurred higher costs from alternative fuel and transportation arrangements.

Supply Recovery and the Durability Question

The situation has since improved considerably. Data from Petrobangla, the state-owned national oil company of Bangladesh, showed gas supply rising to approximately 2,600 million cubic feet per day (mmcfd) in late September, up from around 2,300 mmcfd a month earlier, following a recovery in liquefied natural gas (LNG) supplies. The BGMEA president has also acknowledged that the energy disruption has improved significantly, and reports from industry areas indicate production has been picking up.

Yet even as the immediate energy pressure eases, the more important question is whether this improvement will prove durable. The energy disruption arrived at precisely the wrong moment — when buyers were already reassessing global sourcing strategies. Bangladesh garment exports cannot afford repeated uncertainty over whether factories can reliably maintain production and shipment schedules while competing for orders against Vietnam, India, and other sourcing destinations.

Industry Response and the Case for an EU Free Trade Agreement

The BGMEA chief has reportedly stated that buyers will not necessarily concentrate all sourcing in one country, and that the association is actively working to attract new buyers while encouraging existing ones to increase sourcing from Bangladesh. Notably, he argued that Bangladesh should pursue a Free Trade Agreement with the EU within three to four years, rather than depend on a Generalised Scheme of Preferences Plus (GSP Plus) arrangement.

This position takes on added significance given the current trade environment. With the three-year EBA post-graduation window available, the priority, as industry insiders see it, should be using that time to negotiate a longer-term trade arrangement with the EU — rather than allowing uncertainty over post-EBA access to become yet another factor in buyers’ sourcing calculations.

Industry insiders have also stressed that the government must make the recent improvement in gas and electricity supply last. The two issues — EU trade preferences and energy reliability — are distinct in nature but converge at the same decision point: the buyer choosing where to place the next order.

What Bangladesh’s Competitive Position Now Depends On

Bangladesh garment exports retain considerable strengths — established factories, significant production capacity, and a well-developed buyer base built over decades. But the landscape around it is shifting. India is improving its EU market access through a concluded FTA, Vietnam already holds preferential access, and global sourcing diversification is a stated objective among major retailers. Meanwhile, Bangladesh is still working through its post-LDC trade future while recovering from an energy shock that reinforced buyer concerns about supply reliability.

The central question for the Bangladesh garment industry is no longer simply whether it can attract buyers. It is whether it can offer buyers enough structural certainty — on trade preferences, energy reliability, and production continuity — to choose Bangladesh over an increasingly competitive set of alternatives.

A convergence of factors – rising tariffs, intensifying regional competition, shifting buyer priorities, and a structurally changing retail landscape – is placing Bangladesh apparel exports under mounting pressure in the US market, raising serious questions about the sector’s long-term positioning.

The Numbers Tell a Difficult Story

Bangladesh’s share of the US apparel import market has been slipping. While the country remains one of the largest suppliers of garments to American retailers, its growth trajectory in that market has not kept pace with some competing nations. US apparel buyers are increasingly diversifying their sourcing away from Bangladesh, even as the country continues to offer competitive manufacturing costs.

According to data referenced in industry discussions, countries such as Vietnam, India, and even newer entrants are capturing greater attention from US buyers, in part because they offer a broader product mix, faster turnaround times, or more favourable trade terms – advantages that pure cost leadership cannot easily offset.

Tariffs Adding to the Burden

One of the most direct pressures on Bangladesh apparel exports to the United States is the tariff structure. Unlike several competing nations that benefit from preferential trade agreements with the US, Bangladesh does not enjoy duty-free access to the American market. Garments exported from Bangladesh face tariffs that can range significantly depending on product category, putting Bangladeshi exporters at a structural disadvantage compared to peers operating under free trade arrangements.

This tariff gap has long been a concern for Bangladesh’s RMG exports, but it has grown more acute as US buyers become increasingly cost-conscious in a challenging domestic retail environment. When tariff differentials are layered on top of rising production costs within Bangladesh itself – including wages, energy, and compliance expenditures — the price advantage that Bangladesh apparel exports once commanded begins to narrow considerably.

Compliance and Sustainability: A Double-Edged Demand

The demands placed on Bangladesh’s garment industry by US buyers have also grown more complex. Beyond price, buyers increasingly require demonstrated compliance with environmental, social, and governance standards. Bangladesh has made meaningful investments in green factory infrastructure – the country hosts some of the highest numbers of LEED-certified garment facilities in the world – yet translating those investments into commercial advantage in the US apparel market has proved uneven.

US retailers and brands are pressing suppliers on issues ranging from carbon footprint and chemical management to worker welfare and supply chain transparency. Meeting these requirements demands ongoing capital expenditure and management capacity, costs that smaller and mid-tier Bangladeshi manufacturers often struggle to absorb while simultaneously competing on price.

Product Diversification Remains a Gap

A recurring vulnerability highlighted in assessments of Bangladesh’s RMG exports is the country’s heavy dependence on a relatively narrow product range – predominantly basic knitwear and woven categories such as t-shirts, trousers, and casual wear. While Bangladesh dominates in these segments, the higher-value categories – technical wear, performance fabrics, outerwear, and lifestyle apparel – remain underdeveloped in Bangladesh’s export basket.

US apparel buyers seeking more complex or value-added products frequently turn to other sourcing destinations that have invested more deeply in product development, design capability, and raw material integration. For Bangladesh apparel exports to regain and extend ground in the US market, a meaningful shift toward higher-value product categories is widely seen as essential.

The China-Plus-One Factor and Its Limits

The global sourcing strategy widely referred to as “China-plus-one” – in which brands reduce reliance on Chinese manufacturing by adding alternative supplier countries – initially appeared to offer Bangladesh a significant opportunity. However, the benefits of this reorientation have not flowed as fully to Bangladesh as many in the industry anticipated.

Vietnam, in particular, has captured a disproportionate share of orders redirected away from China, owing to its stronger presence in higher-value segments, its trade agreement network, and its proximity to Chinese raw material supply chains. Bangladesh’s RMG exports have benefited to some degree from supply chain diversification trends, but not to the extent that its production scale and cost structure might theoretically support.

Freight, Lead Times, and Logistics Pressures

Geography and logistics also play into Bangladesh’s competitive position in the US apparel market. Longer lead times relative to nearshore competitors in the Western Hemisphere, combined with periodic port congestion and logistics disruptions at Chittagong, have made agility-focused US buyers cautious about deepening their Bangladesh sourcing for fast-replenishment programmes.

As US retailers continue to reduce inventory risk and shorten buying cycles in response to unpredictable consumer demand, suppliers that can offer speed and flexibility alongside cost competitiveness gain a structural advantage – one that Bangladesh’s garment industry, despite its enormous scale, has found difficult to fully match.

Industry Voices and the Path Forward

Leaders within Bangladesh’s garment industry and trade bodies have acknowledged that the sector must evolve beyond its low-cost identity. Discussions within the industry point to the need for investment in technology, workforce skills upgrading, raw material backward linkage development, and brand-building capacity if Bangladesh apparel exports are to remain competitive in the US and other premium markets over the long term.

The Bangladesh Garment Manufacturers and Exporters Association and related industry bodies have consistently advocated for preferential trade access to the US market — a structural remedy that could partially offset the tariff disadvantage – though no concrete policy progress on that front has been reported to date.

A Sector at a Crossroads

Bangladesh’s RMG exports remain a cornerstone of the national economy, accounting for the overwhelming majority of the country’s foreign exchange earnings and employing millions of workers, a significant proportion of whom are women. The stakes of the sector’s performance in the US apparel market – its largest single buyer country  are therefore not merely commercial but deeply social and economic.

The message emerging from current market dynamics is clear: low cost alone is no longer a sufficient value proposition for Bangladesh apparel exports in the US market. Competing effectively going forward will require a more complex and diversified offering – one that combines cost efficiency with quality, compliance, speed, and product sophistication.

Whether the sector can execute that transition at the pace and scale required remains the defining challenge for Bangladesh apparel exports in the years ahead.

What Neubodi Brings to the Table

Neubodi has carved out a distinct position in Malaysia’s intimate apparel segment through its proprietary holistic bra fitting approach and an offering that spans 72 bra sizes — covering cup sizes A through I and band sizes 65 to 100. The brand currently operates 11 retail stores across the Klang Valley, Penang and Johor, with a presence in some of the country’s most prominent retail destinations, including Mid Valley Megamall, 1 Utama, Sunway Pyramid and IOI City Mall. Beyond its physical stores, Neubodi engages consumers through e-commerce and social media channels, giving BrilliA a multi-channel retail platform to build upon.

This combination of specialist bra fitting knowledge, a well-established retail network and active digital consumer engagement gives BrilliA an operational foundation for serving end consumers directly — a capability the company has been looking to develop as part of its broader growth ambitions in branded consumer retail across Southeast Asia.

Leadership Continuity at Neubodi

Tan See See, co-founder of Neubodi and a professional with more than 15 years of experience in the intimate apparel industry, will continue to serve as Chief Executive Officer of Neubodi following the acquisition. Ooi Kit Joyce will also remain part of the senior management team, ensuring operational continuity and brand consistency as the business integrates with BrilliA’s wider portfolio.

BrilliA’s Strategic Rationale

Kendrew Hartanto, Chief Executive Officer of BrilliA, explained the reasoning behind the BrilliA acquires Neubodi transaction. “Neubodi represents an important milestone in BrilliA’s evolution from a B2B intimate apparel supply and design provider into a more diversified business with a growing presence in branded consumer retail,” he said. “Neubodi has built a differentiated position in the Malaysian lingerie market through its specialist fitting expertise, established retail network and direct relationships with consumers. We believe these capabilities provide a strong foundation for BrilliA to expand its branded retail platform in Southeast Asia.”

Hartanto further outlined the synergies the company expects to unlock. “By combining Neubodi’s retail and consumer capabilities with BrilliA’s global sourcing, design and supply chain expertise, we see opportunities to support the brand’s continued growth, improve operating leverage and develop additional distribution opportunities for our intimate apparel portfolio. We are excited to welcome the Neubodi team to BrilliA and look forward to building on the brand’s strong foundation.”

Financial Targets and Operational Outlook

Based on Neubodi management’s budget for the financial year ending December 31, 2026, the brand is targeting net sales of approximately US$3 million, with an expected net profit margin of approximately 10% to 12%. BrilliA expects the acquisition to complement its existing operations and support the development of a broader intimate apparel platform across multiple distribution channels.

The company also noted that the acquisition advances its strategy across several operational and commercial areas, including expanding branded retail presence, improving supply chain integration and broadening its intimate apparel Southeast Asia portfolio. However, the company was clear that these targets represent management expectations and are not guarantees of future results — with actual outcomes depending on market conditions, execution and the company’s ability to integrate and grow the business.

Malaysia Lingerie Market Context

The broader Malaysia lingerie market provides meaningful context for this acquisition. According to market research published by IMARC Group, the Malaysia lingerie market was valued at approximately US$287 million in 2025 and is projected to surpass US$500 million by 2034, reflecting a compound annual growth rate of approximately 6.3% from 2026 to 2034. This growth trajectory underlines the scale of opportunity available to brands with established specialist bra fitting credentials and a reliable retail footprint in the region.

For BrilliA, the Neubodi acquisition is positioned as a platform to capture a share of this expanding market — combining the brand’s consumer-facing expertise with BrilliA’s design, sourcing and supply chain strengths to develop a more competitive and diversified intimate apparel business in Malaysia and, over time, across broader Southeast Asian markets.

A Sector Still Recovering From Its Own Peak

Export data tells a telling story. Sri Lanka apparel exports reached approximately $5.59 billion in 2022, before declining to $4.54 billion in 2023 and recovering partially to $4.76 billion in 2024. By 2025, exports had climbed back to around $5.02 billion, marking a return to pre-decline levels — but still well below the 2022 high. To reach the $8 billion target, the industry would need to grow its export earnings by roughly 60 per cent from current levels within the next five years.

What makes this challenge even more pronounced is the fact that the $8 billion target is not entirely new. Sri Lanka’s apparel industry had previously set the same goal — with a 2025 deadline. That target was not met, with exports remaining around the $5 billion mark throughout. The renewed 2030 ambition therefore brings with it a pointed question: what will be done differently this time around?

The Real Question Is Structural, Not Just Numerical

The arithmetic of the textile export growth target is relatively simple: add approximately $3 billion to annual export revenues over five years. The more complex question is where and how that growth will materialise. Industry stakeholders and analysts suggest that the path forward is less about broadening the geographical footprint of garment manufacturing and more about deepening the value chain.

Sri Lanka does have precedent for successfully deploying coordinated industrial policy in this sector. The 200 Garment Factories Programme, launched during the 1990s, effectively decentralised garment manufacturing beyond the capital Colombo, channelled investment into rural areas and widened the geographic base of the industry considerably. However, the nature of today’s challenge is substantially different.

Reducing Dependence on Imported Inputs

One of the most persistent structural constraints facing the apparel industry is its heavy reliance on imported raw materials — particularly fabric. Industry estimates place annual textile and apparel input imports at around $2 billion. Expanding domestic production of synthetic yarn, fabrics, trims, and packaging would strengthen local supply chains and increase domestic value addition.

That said, import substitution on its own would not be enough to close a $3 billion gap. The broader consensus among industry stakeholders is that meaningful progress requires combining greater domestic value addition with sustained growth in overall Sri Lanka apparel exports.

Productivity, Technology and Higher-Value Products

Industry leaders are placing increasing emphasis on automation, robotics, artificial intelligence, and digital production systems as tools for improving manufacturing efficiency and competitiveness. Alongside these productivity-focused measures, there is a growing push to move into higher-value market segments — including technical textiles, performance wear, and specialised products — where Sri Lankan manufacturers can compete on capability and craftsmanship rather than primarily on cost.

This shift toward higher-value production is seen as a key component of the apparel industry 2030 strategy, enabling manufacturers to generate greater revenue per unit and reduce vulnerability to cost-based competition from lower-wage economies.

Market Access as a Growth Lever

Domestic value addition and productivity improvements will only deliver results if Sri Lanka can maintain and expand its access to major export markets. Preferential market access remains a critical factor in the industry’s global competitiveness.

Recent changes to the United Kingdom’s Developing Countries Trading Scheme are one example of how policy shifts in importing countries can directly affect Sri Lankan manufacturers. The revised rules of origin under the scheme could potentially give Sri Lankan apparel exporters greater flexibility in sourcing inputs, while still retaining preferential access to the UK market — an important consideration as the industry seeks to diversify and grow.

JAAF’s Policy Calls

The Joint Apparel Association Forum (JAAF) has reportedly called for a comprehensive policy response to support the industry’s ambitions. This includes stronger investment incentives for upstream textile manufacturing, improved preferential market access, and better coordination among the institutions involved in the development of the textile and apparel sector. These calls reflect a broader recognition that reaching the $8 billion mark will require concerted effort across government, industry, and trade policy.

What Needs to Happen

The path to $8 billion in Sri Lanka apparel exports by 2030 is defined by several interconnected priorities. Industry stakeholders argue that the country must deepen its domestic supply chain, raise manufacturing productivity, increase value addition at each stage of production, develop higher-value product categories, and secure expanded opportunities in both existing and new markets.

Each of these elements individually contributes to apparel industry 2030 readiness. Together, they form the foundation of what would need to be a coordinated and sustained push to add $3 billion to annual export earnings — within a five-year window that has already begun.

Whether the industry can deliver on the 2030 target where it fell short of the 2025 one will depend on whether the structural reforms, investment incentives, and market strategies now being discussed translate into measurable action on the ground.