Promotional Apparel and the Value of Planning Ahead

Due to current challenges in the promotional apparel market the industry may see increased prices over the next year. 

It is widely known that most promotional apparel and merchandise is globally sourced.  Various factors impact the costs of these goods:  Raw Materials (cotton, polyester, plastic), Inflation in Developing Countries, Labor, Duties and Tariffs, Transportation, and Foreign Exchange Rates.  These factors do not affect every product in the same way and suppliers also have many ways they can help control prices.  Nonetheless, current pricing of foreign-made goods is being affected by two primary factors:  raw materials and labor. 

Using cotton as an example, cost per pound has increased 83.6% in the past 12 months.  Because of the rapid growth of business in China, there is now a labor shortage and a demand for higher wages on the part of China’s factory workers. These factors have combined to drive up labor costs. Meanwhile, factories in other regions do not yet have sufficient infrastructure to support increased consumer demand.

Amid these two key factors, other forces are at play as well. Most notably is the likely appreciation of China’s currency (RMB), which will increase import prices across Asia.

With so many influencing factors, it is impossible to predict the full extent of price pressures in this industry.  So, how can you maximize your company’s investment in promotional products?  Use this insight and adopt a proactive and well-planned approach to your buying needs:

1) Plan your purchases as far in advance as possible, thereby enabling a thorough and comprehensive product search, and possibly alternate sources of supply.

2) Consider purchasing American-manufactured products.

3)  Work closely with your One 2 One Account Executive to enable you to obtain the best value for your expenditure.