Q2 2024 Barometer: Q1 Procurement Uptick - a Beacon of Hope for Western Retail?

In this month’s newsletter, we are sharing some key findings from our Q2 2024 Barometer, where we provide valuable insights into the current state of the sourcing landscape and positive developments that lie ahead.

The first quarter of 2024 marked a significant uptick in procurement volumes, indicating a promising development for the retail industry in Western regions. This surge can be attributed to various factors, including improved consumer sentiment in the West, fading recession fears, inventory replenishment after the holiday season, and brands adapting to longer freight transit times due to the Red Sea crisis.

China, a powerhouse in manufacturing, experienced a remarkable resurgence in demand. QIMA's data revealed that US-based buyers increased their demand for China inspections and audits by 12% year-on-year, while European brands saw even more significant growth, with Germany leading the way at 35%, followed by France and the Netherlands. Furthermore, QIMA's survey indicated that two-thirds of respondents globally plan to maintain or increase business volumes with Chinese suppliers in 2024.

Textile sourcing witnessed a global surge as fashion brands restocked after the consumer splurge during the year-end. Demand for textile and apparel inspections and audits rose by 20% year-on-year in Q1 2024. While China regained popularity among apparel brands, other Asian countries and beyond kept pace. Bangladesh, in particular, gained traction as US and EU brands increased their procurement, instilling optimism for the country's export sector. India, another major textile player, experienced slower growth due to diversification into new sectors.

Nearshoring, a prevailing trend, continued to gain momentum in the EU despite geopolitical risks. QIMA's data showed steady growth in the sourcing portfolios of EU-based buyers, with home and neighboring markets accounting for 15% of all purchases. The Mediterranean region, including Jordan and Egypt, demonstrated resilience amidst the current geopolitical challenges in the Red Sea area. US-based brands expressed interest in local sourcing but exhibited slower progress in turning plans into reality.

To delve deeper into more the insights and trends, we invite you to view the full version of our Q2 2024 Barometer .