Global Sourcing Trends: Recent Updates
Latest Update & Forecast
Oct 15, 2024
Global Sourcing Trends
China Still A Crucial Sourcing Partner
As disruptions become the norm in global sourcing, brands and retailers have begun preparing for the 2024 holiday season early, with many looking to China to be their port in the storm.
QIMA data reveals a 21% year-over-year increase in demand for inspections and audits in China from US and EU buyers (Q3 2024). Electronics and Electricals (+41% YoY) and Homewares (+22%) were among the most in-demand product categories. Textiles and Apparel inspections also saw a +23% rise, likely due to the reduced availability of Asia’s other textile hubs this quarter.
Extreme Weather Disrupt Supply Chains
In Q3 2024, Typhoon Yagi, the strongest storm of the year, significantly disrupted sourcing in Southeast Asia, particularly in Vietnam. The typhoon caused an estimated $1.6 billion in economic damages, including damage to factories that will take weeks to repair. This led to a dip in demand for inspections and audits in the region during September, as businesses faced delays and lost production from affected factories. The impact of extreme weather events like Typhoon Yagi underscores the growing vulnerability of global supply chains to climate-related disruptions.
Inspection & Audit Demand in Southeast Asia
Read the full report: Q4 2024 Barometer
Stay up to date with all the latest supply chain trends with our Supply Chain Insights.
About Global Sourcing Trends
At QIMA, we closely monitor global sourcing trends with our regular surveys of over 800 businesses worldwide and a robust data pool from audits and inspections of over 30,000 clients. Our longstanding industry presence in over 100 countries has honed our understanding of the global supply chain landscape, enabling us to deliver unique insights.
Previous Updates
Q3 2024
Update: Jul 15, 2024
Global sourcing volumes have trended upwards in the first half of 2024, driven by increased consumer optimism and inventory restocking efforts. Key factors contributing to this trend include:
See-Saw Effect in Asian Manufacturing Hubs:
Vietnam, Bangladesh, and India have rebounded after a slow 2023, while some leading markets from last year have slowed down.
China continues to build on its recovery from 2023, maintaining strong manufacturing output despite geopolitical uncertainties.
Geopolitical Influences:
Russia’s ongoing war in Ukraine and the upcoming US presidential election are causing uncertainties in global supply chains.
Increase in Sourcing from China:
Strong demand for Chinese manufacturing from European and emerging markets.
Inspections and audits in China ordered by European businesses increased significantly (Germany +27% YoY, UK +32% YoY).
US buyers showed a measured approach, but inspections and audits in China still rose by +13% YoY, spanning various consumer goods categories.
China’s trade with emerging economies continues to grow, with significant demand for inspections and audits from Latin and South America, and strong business interest from Mexico.
Top sourcing markets for US and EU, based on QIMA audit data
Read the full report: Q3 2024 Barometer
Q2 2024
After a year of sluggish demand, sourcing volumes rose across industries and regions in the first quarter of 2024, both in overseas supplier regions and nearshoring markets.
This swell in procurement can be linked to multiple factors, including:
Fading recession fears and improved consumer sentiment in the West
Inventory replenishment following the holiday season
Brands relying on larger shipments to mitigate longer freight transit times on routes affected by the Red Sea crisis.
Increase in textile sourcing globally: Following a slow 2023, demand for textile and apparel inspections and audits was up +20% YoY in Q1 2024 globally.
Increase in sourcing from China: Q1 2024 saw the appetite for made-in-China bouncing back in the West, with demand for China inspections among US buyers growing by 12% YoY and demand among European brands growing by around 30% YoY.
China sourcing plans for 2024, as reported by businesses (by buyer region)
Read the full report: Q2 2024 Barometer
Q1 2024
Sourcing in China is on the rise for the first time in years. While China was once the primary supplier for global supply chains, the COVID pandemic caused many companies to shift their suppliers to southeast Asia and nearshore locations. A recent QIMA survey, however, indicates that they’re shifting back to Chinese suppliers.
China’s relative share in US- and EU-based supplier portfolios rose 5.4% YoY in 2023, showing the first uptick for the first time in five years.
Usage of Chinese sourcing will likely increase in 2024. Over half (59%) of US buyers and (68%) of EU-based buyers plan to increase or maintain current buying habits with China, while only 30% of US buyers and 20% of EU buyers intend to reduce sourcing in China.
Read the full report: Q1 2024 Barometer
Q4 2023
Bangladesh exports have been struggling this year, including its flagship textile and apparel sector, which experienced a -10% YoY dip in demand for inspections and audits during the first nine months of 2023. US-based buyers in particular appear to be scaling back textile and clothing sourcing from Bangladesh. To protect its exports from future shocks, Bangladesh must diversify its supplier offerings – or risk further dips in sourcing demand in the future.
Bangladesh's textile and apparel sector struggles: In the first nine months of 2023, Bangladesh's textile and apparel sector witnessed a 10% year-over-year decline in demand for inspections and audits, signaling a challenging year for the industry.
Diversification as a solution: Bangladesh holds a 34.7% share in the EU’s cotton imports, but its share for non-cotton garments is only 12%. To safeguard its exports and remain competitive as a sourcing destination, Bangladesh must diversify its supplier offerings.
Expanding beyond its traditional cotton focus and embracing man-made textiles can help Bangladesh broaden its appeal to global markets.
Read the full report: Q4 2023 Barometer
Q3 2023
EU and US companies sourcing in Asia are increasingly turning away from China, towards Southeast Asia.
In 2023, China’s share of the EU and US sourcing market dropped by 14% with Southeast Asia seeing the largest growth since 2019. This trend is expected to continue.
Latin America-based businesses’ demand for audits and inspections for suppliers in China increased by 13% year-over-year in Q2 2023 compared to flat demand from Western buyers in the same period.
The combined share of Southeast Asia’s sourcing markets in the buying portfolios of US- and EU-based brands has been steadily growing, and in H1 2023 amounted to almost half of that of China (compared to one-third in 2020).
US and EU buyers’ top sourcing markets by share
Read the full report: Q3 2023 Barometer
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