China-based suppliers were back in full force at the Sourcing at Magic show in Las Vegas this week, signaling a return to pre-pandemic patterns.
The country ended its mandatory Covid quarantine period on Jan. 8, after over three years of strict requirements for those returning to China from travel abroad. The number of exhibitors registered for the apparel, footwear and textile sourcing expo ballooned following the Chinese government’s announcement in December, according to its Sourcing at Magic vice president, Andreu David.
“As soon as those restrictions on quarantine were lifted, we started pacing bigger,” selling out all the space allocated to the event at the Las Vegas Convention Center. David said Informa Markets Fashion, which runs the event, had to rent out another hall at the venue to accommodate last-minute registrants, bringing the total square footage of the Sourcing show to around 112,000 square feet—about 30 percent larger than the August 2022 event. Out of 958 exhibitors listed in the event’s directory, 638 hailed from China. Buyers, too, were on the rise. More than 25,000 attended, a 9 percent increase from the August event.
Yiwu Wingtu Import and Export Co. Ltd., based in the Zhejiang province, returned to Sourcing for the first time since 2018, according to sales manager Johnny Liu. Specializing in outerwear like sherpa jackets, fleeces and button-down shackets for specialty stores and e-commerce businesses like lifestyle boutique Pink Lily, it saw steady, if modest, interest this week, generating several new leads.
Liu said its lead time typically amounts to about three months, and that production and logistics have stabilized after a difficult period in 2021 when shipping costs skyrocketed and the producer struggled to find container capacity. “Last year was ok,” he added.
Ningbo, China-based Blossom Knitting—which creates women’s casual apparel for Western retailers like Kohl’s, Target, Costco, JCPenney, Aeropostale and Zara—has maintained a presence at the Sourcing show throughout Covid, either through the Sourcing digital platform or in person.
Foreign trade manager Coco Hunt, who is based in California, said she has attended the shows on her own in recent seasons, but a colleague from China was able to join her for the first time this week. Competitors have also relied on stateside attaches or hired and trained temps to man their booths while quarantine orders were still in effect in China—a business that boomed last year, according to David.
Hunt said that this week’s show offered greater opportunities for business than the event six months ago. Because there were fewer Chinese exhibitors in August, “some customers didn’t come,” she said. “It was much slower. This time, there has been more traffic, more people.”
Blossom Knitting employs about 500 workers and has about 12 automated production lines, along with verticalized operations that Hunt said the company has marketed to its advantage. The company owns its own fabric mill near its cut-and-sew facilities, which has helped streamline business. “I noticed a lot of production started moving to Southeast Asia, because the labor is much cheaper,” Hunt said. However, she said brands and retailers that have made these sourcing shifts throughout the pandemic might now be coming to grips with their inefficiencies. Producers are still reliant on fabrics and inputs from China, including machinery, like printing plates. “The Ningbo region has a very mature garment industry, so everything is close by,” she added.
And while port congestion caused massive delivery delays, prompting the business to turn to more costly transport methods during 2021, “It’s all back to normal now,” Hunt said.
David said that the show continues to focus on educating brands about supply chain diversification, though he believes permanent movement away from the sourcing superpower will prove more limited than some sourcing experts previously believed. Despite the continued influence of tariffs and escalating tension between the U.S. and China, brands’ memories may prove short. “It’s still very competitive,” he added. “They have perfected manufacturing for certain categories in terms of quality, and there are very few countries that can do it as well as they do.”
“There’s a lot going on politically that is playing into decisions, as to whether or not we want to have ongoing sourcing from China or selling into China,” WRAP CEO and president Avedis Seferian said at a seminar on compliance on Tuesday. “That has nothing to do with business.”
Egypt, India, Pakistan, Turkey and a grouping of countries from Southeast Asia also saw substantive representation at the show, with each country or region occupying its own designated space in the Sourcing hall. Seventy-one vendors represented Indian businesses, while 31 came from Pakistan and 15 came from Turkey.
Meanwhile, Latin American countries showed up in smaller numbers than August. Six exhibitors from Mexico were in attendance, along with four from Colombia, two from Guatemala and Peru, one from Brazil and one from Honduras. According to David, some of these nations’ suppliers are only able to obtain government subsidies to attend one Sourcing event in the U.S. each year, and many chose the August show. “Brazil is one we’ve set our sights on,” he added, noting that the country’s capacity for verticalized production makes it an attractive option for brands looking for nearshoring options.
The showrunner is also aiming to build up the show’s contingent of African vendors. Ghana, Benin, and Kenya each had one exhibitor at the show. “I’m asking my team to invest in exploring, and having some discovery there, to see what more we can bring in,” David said. [Africa] is where a lot of manufacturing is going—a lot of Chinese companies are opening factories there, so we’re thinking that might be an untapped territory.” The Sourcing team is also closely monitoring legislation concerning the region’s free-trade status with the U.S., such as the Africa Growth and Opportunity Act (AGOA), which is set to expire in 2025.
Sourcing is also deepening its focus on environmental and ethical production, bringing back its Sustainability Gallery of materials and products verified by social impact data analytics company Hey Social Good. The show has seen invigorated interest in issues like labor compliance, social justice, greenwashing and sustainable product development, prompting the buildout of a section dedicated to verified suppliers and a stage specifically designed for seminars and panels on the subjects. Meanwhile, a denim installation juxtaposed jeans made with traditional processes with products from global mills engaged in more eco-friendly dyeing, washing and finishing techniques.
Hey Social Good founder Dr. Cindy J. Lin, who moderated a number of panels, said that buyer feedback at the August show prompted the Sourcing team to consolidate exhibitors with a known focus on sustainability or social justice, so they could shop for suppliers with their values in mind. “We recognize that education is such an important part of it,” because topics like certifications, carbon impact and legislative compliance have proven “confusing” for members of the industry looking to build more sustainable supply chains. “We want to build…this platform where people feel there’s a community, and do it in an engaging way,” she said.