American apparel buyers are closely reviewing sourcing strategies following the new tariff agreement between Bangladesh and the United States, with particular focus on textile- and apparel-specific provisions, according to a recent study.
The Agreement on Reciprocal Tariff, signed on February 9, reduces tariffs on Bangladeshi goods from 20% to 19%, while offering duty-free access for garments made using US-origin cotton and man-made fibers. The move is prompting brands to reconsider sourcing decisions amid ongoing tariff pressures and geopolitical uncertainty.
The study, conducted by Sheng Lu of the University of Delaware, identifies four key strategies adopted by US fashion companies: diversifying sourcing bases, reducing reliance on China, expanding procurement from lower-cost hubs like Bangladesh and Vietnam, and exploring near-shoring options in Mexico and Central America.
Companies are also closely monitoring trade agreements with Bangladesh, particularly provisions tied to US cotton usage, which could influence tariff benefits. However, full sourcing adjustments are expected to take 12–18 months or longer.
Industry players such as Kontoor Brands highlighted Bangladesh’s importance in their sourcing mix, noting that tariff exposure depends on the extent of US cotton used. Meanwhile, brands including Ralph Lauren and Lands’ End indicated ongoing shifts in sourcing patterns and supplier diversification.
Responding to the development, Mahmud Hasan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association, stressed the need for a clear mechanism to verify the use of US cotton in Bangladesh-made garments to ensure eligibility for tariff benefits.
The findings underscore how evolving trade policies and global market dynamics are reshaping sourcing decisions, with Bangladesh remaining a key player in global apparel supply chains.
