Forrest Cookson, PhD

Mr. Trump’s tariff policies have introduced great confusion in the market for ready-made garments (RMG) creating great uncertainty as to how trade will take place in the next few years. The garment industry is going through three different transitions other than the trump tariffs: 1. The resistance by the United states for imports of garments from China has grown steadily resulting in the need for sourcing of garments to the more significant amount of the American market from countries other than China. 2. Changes in technology are rapidly increasing the degree of automation and reducing the labor inputs required. 3. There is much emphasis the EU and in the United States on environmental issues such as water conservation and reduced energy consumption. It is on top of all of these factors that the Trump tariffs are creating great uncertainty as to how this market will evolve.

Bangladesh consequently faces major problems in remaining competitive and growing its exports of RMG products to the USA. Everyone realizes that these considerable threats to the competitiveness of the Bangladesh product.  We begin with a brief review of what has taken place: Bangladesh exported garments worth $7.4 billion in 2024 and $ 2.2 billion during the first quarter of 2025.  Exports of garments have grown strongly since 2016.  Tariff levels ranged from 11% to 18% over most garment products.  On April 2, 2025, the United States raised tariffs by an additional 37% leading to tariffs of 50%.  Tariffs were raised to different levels for each country thus violating the central concept of international trade, the most favored nation principle. Subsequently the American government deferred thee imposition of these higher tariffs for 90 days that is until early July. This gave a period of 90 days when governments could discuss with the United States the level of these tariffs and what might be done to lower them. Two countries seemed to have successfully negotiated changes. First the UK who reached an agreement that the tariff level would be 10% levied by the United States on imports from the United Kingdom. However, there is a higher tariff of 25% on automobiles and automobile spare parts. Also, a special tariff on steel and aluminum. Not all aspects of the agreement between the two nations were completed so one could say that the UK agreement with the United states has not yet reached its final form. The second agreement was between the United States and China. That agreement, valid for 90 days, reduced Chinese tariffs on US goods to 10% and American tariffs on Chinese goods to 30% The US Secretary of the Treasury also stated that countries might begin to receive a final tariff level within the next two weeks. There is just tremendous confusion brought about by the United States, probably deliberately.  There is no clarity yet as to the level of tariffs that the United States is imposing on other countries nor is it completely clear that there is going to be violation of the M F N condition. How this will be resolved is not known. Mr. Trump seems to be jumping from one thing to another with no clear purpose or reason.

It is impossible to predict where Bangladesh is going to end up here in the second part of this paper we will discuss what the government is proposing to do in answer to the American increase in tariff but there is no real way to understand where this might end. We can ask what is in Mr. Trump’s mind in this wild unstructured announcement and change in tariff levels for different countries. We can begin with the realization that Mister Trump believes that the United States is being exploited by countries like Bangladesh that run a high trade surplus. In Bangladesh the high tariffs that are imposed on imports certainly cause a reduction in what might otherwise be a substantial import bill. Mr. Trump’s desire to bring the US trade balance close to zero is one thing; the attempt to balance trade with every country is another. The idea of trying to have a sharply reduced and almost zero current account deficit between the United States and many other countries each being separate makes no economic sense whatsoever. That does not seem to deter Mr. Trump who continues to peddle this nonsense about setting tariff rates with the objective of closing the trade gap between the United States and the rest of the world. Trump has taken advantage of this move to force countries to negotiate on trade issues and perhaps other issues almost every country is concerned about preserving their trade with the United States. Only a few countries do not run a large surplus with the United states. A second reason that is sometimes raised as an explanation of the motivation for implementing these wacky tariff levels Is that it should encourage American and foreign companies to invest more in the United states under the protection of these very high tariff rates.

Mr. Trump seems to want to bring industry back to the United States as it was 40 years ago. There was a significant shift of many industries out of the United States to countries where labor costs were lower. This is a natural progression of the economic development of the world economy. Such shifts result in allocation of Labor and capital in a fairly efficient way compared to the all-too-common setting tariffs for political purposes or to protect an industry which doesn’t really need protection or should not be protected. A great deal of the poverty in South Asia arises from the strong tendency to maintain high tariff rates to protect domestic industries from foreign competition. This is the opposite of what one should attempt to do to develop and enforce a sound trade policy. In order to achieve this objective, it will be necessary to maintain the high protective tariffs for a long time meaning that if this is an important consideration the United States will not be interested in lowering these April’s 2 tariffs. Mr. Trump does not have a carefully worked out plan on trade policy, he is jumping from one thing to another with the vague idea that reducing the trade deficit will be good for the United States. There are many wild stories going around that this disruption of international trade is a carefully thought-out plot by Trump to somehow increase the power of the United States over the rest of the world The third reason sometimes given for the high tariffs is to increase government revenue. In Mr. Trump’s mind is the idea that by increasing revenues earned from taxing imports it is possible to reduce the Income taxes that are the main source of government revenue. However very simple arithmetic indicates that this is a ridiculous proposition and no significant impact on income taxes will be achieved by high tariffs. At the end of the 19th century tariffs were an important part of government revenue much more important than now. But it was illegal in the United states to levy income taxes until the 18th amendment to the constitution made that possible. Besides the US Government was very small relative to the size of the economy.

These three reasons for levying high tariff rates on imports from all other countries are not based on careful analysis of what is necessary to achieve the purported objectives. The objectives themselves are all foolish and inappropriate for the American economy. The United States should run a large deficit on its trade account and accept the fact that people will hold the dollars that cover the difference between the trade levels. So long as the dollar is the key dominant currency in international trade and investment then there will be a strong demand by financial systems and companies all over the world to hold dollars. A strong dollar tends to decrease American exports and increase imports into the United States. Mr. Trump talks about having a strong dollar and reducing the trade deficit. These are incompatible ideas and economic nonsense to pursue them together. The last reason that is given for the high tariffs is quite different. It suggests that the United States will now confront other countries with the demand that they reduce their economic relations with China and in return for such reduction the US will lower the tariffs. It is easy to see that some people in the United States government who are focused on the differences in view of China and the United States would see here an opportunity to cause difficulty for China but in the event Mr. Trump’s effort to raise tariffs to very high levels for countries other than China has blown back in his face. The United States appears to be in long term conflict with China and seeks apparently to try to reduce Chinese economic influence around the world. This of course is economic and political nonsense and precisely the wrong way to deal with China. All that Mister Trump is doing is reducing the role of the United States in the international economy and leaving the leadership of world trade to the Chinese. It really makes no sense whatsoever for the United ‘States to take such actions, nevertheless this is what is happening.   An ill-informed Americzn President is attempting to carry out policies that make no sense and none of his staff seems prepared to try to change his mind. In this explosion of irrational behavior, it is difficult. to formulate a satisfactory response.

The implementation of regimes of high tariffs will reduce international trade and reduce or slow down growth of world GDP.  The low tariff world that has been in place leads to appropriate allocations of capital to different countries and maximizes world output.  Any interference in the free flow of goods and services reduces the total output and allocates labor and capital improperly.  The high tariffs will then reduce incomes in the advanced economies and reduce the demand for clothing.  This income effect hits all countries and results from the dramatic change in tariff levels that the United States announced.   As the magnitude of the tariff are changing everyday it is difficult to understand how large this income effect might be. 

The tariffs different for each country suggest that the landed price for different garments will be different. How the buyer would deal with this is uncertain. What these different tariff levels mean for competition among countries supplying garments to the American market is again impossible to determine as there is as of now no final level of tariffs that has been established. It is likely that there will be little difference in the tariff levels for different countries with no particular advantage to anyone. What we do know is that the management of these tariff changes by the United states is creating vast uncertainties as to what prices will be and what one should order for the future markets. If the tariff rate were to rise to 50% for Bangladesh garments and this is similar to the impact on other supplying countries’ then the question becomes help customers in the retail stores in America will react to these much higher prices for clothes. We would expect a shift away from clothes to other items desired by the consumer. This price effect operating really only in the American market could be quite severe.

The price to the consumer is the landed price which reflects the price of production, the cost of transportation and the tariff. The American buyer will add his mark up landed price which will be the price at which he sells to the retail stores. The buyer has some freedom to adjust the markup to establish his offer to the retail stores. The buyer may well be prepared to reduce his markup to make the garments more attractive to the retailer. The retailer in turn has to determine his mark up on the price at which he purchased the garments from the buyer. These markups to the retail level are usually very high, well above 50% With the imposition of high tariffs buyers will pressure the Bangladesh maker to reduce his price, it is unlikely that the transporter will reduce his prices. let us say a typical item cost 100 landed before the tariff with the 50% tariff this becomes 150 before the increase in tariff the markup by the buyer would be 25% and the markup by the retailer 75% hence more than doubling the landed cost. If we take the current 15% tariff, then the item has a landed price of115; the price at the retalil level is 252. If you increase the tariff to 50 then the retail price becomes 328, an increase of 30%.  If the Bangladesh manufacturer reduces the price 2%, the buyer reduces his market up to 21% and the retailer to 68%, then the price is 300 an increase of 20%.  The 37% would have a major impact on earnings but would not be too hurt as far as prices go.

It is impossible to predict how the competition will develop. Bangladesh can be cooperative and attempt to increase imports from the United States.  But unless one is prepared to give up the MFN rule there is only very limited prospect for increased imports from the USA.  Cotton is the most promising but there are many complications to make American cotton competitive. India and China are cheaper suppliers of most things. Goodwill can be earned by improving protection of Property rights and passing the Labor Law as promised.

The best policy for Bangladesh is to focus on non-US markets, to work with the US buyers to try to stay competitive, and to broaden the range of garments to produce.  Everyone should stay calm about the tariff position and concentrate on the real issues of improving productivity.  The Government has a responsibility to improve the gas and electricity supply, shorten the clearance times at customs, and improve the use of the Chattogram highway. 

I expect that the US Government will settle for a tariff level of 20% and insist on better IPR efforts and improved labor rights.  That is not too bad, only slightly above the current tariff levels.  The Government would be well advised to expand the Biman fleet through a deal with Boeing, shift military procurement more to the USA and finally explore the prospects for purchasing 5 nuclear power plants from the United States.

To build the RMG sector one must turn away from financing that is never repaid; from not investing in automation; from expecting the Government to bail out the industry when troubles strike.  A more positive approach is needed.  There is an unwillingness to train Bangladesh technicians to take over the jobs now carried out by Sri Lankans and Indians.  There is certainly considerable Indian money invested in the sector.  That must be declared, and the finances of the enterprise be made transparent.  An effort should be made to switch financing to the capital market that would finance air conditioning, automation, and establishment of the health care and education of the workers’ children.

If more serious trouble develops with the United States everyone should stay calm.  It is likely that the Democrats will take control of the House of Representatives, and the Congress will reclaim the right to set tariff rates reversing the chaos.

At the beginning of the article three major changes in the industry were noted.  These are far more important than the nonsense Trump had introduced to the world.  

The shift of the Chinese out of the garment sector continues to present opportunities for increased Bangladesh production.   One should welcome joint ventures with Chinese manufacturers who will bring market access and knowledge and improved technologies.  A detailed investigation of the ways and means to accomplish such a shift must be undertaken. 

The second point dealt with the automation.  It is remarkable that there are not closer research efforts between US and Bangladesh scientists.  The Government is waiting for someone to fund this type of arrangement.  It is the duty of the Government to use its own resources to accelerate automation.  AI will change the industry in the next five years in ways that we cannot now imagine or believe possible.  Either Bangladesh will take up the challenge or lose its current leading position.  If this path is not taken their will be wails of disaster and failure as the industry shrinks.

It is surprising that so little attention is paid to these issues.  Along with the equipment and the automation comes the training.  New methods are developed to improve training.  These must be learned and used.

The third revolution in the industry is in the environmental demands. We know what the demands will focus on reduced energy consumption, careful treatment and recycling of water, treatment of chemicals and safety.

We are fascinated with the Trump tariff show but the real challenges are in the three points noted above.

The Apparel Digest Report

Denim is a sturdy cotton warp-faced textile in which the weft passes under two or more warp threads. This twill weave produces a diagonal ribbing that distinguishes it from cotton duck. Denim, as it is recognized today, was first produced in Nîmes, France.

The main difference between denim and jeans is that denim is a fabric, while jeans are a garment (specifically, a type of pants). Denim is a durable cotton fabric typically used for making various clothes, including jeans. 

Denim is available in a range of colors, but the most common denim is indigo denim in which the warp thread is dyed while the weft thread is left white. As a result of the warp-faced twill weaving, one side of the textile is dominated by the blue warp threads, and the other side is dominated by the white weft threads. Jeans fabricated from this cloth are thus predominantly white on the inside. Denim is used to create a wide variety of garments, accessories, and furniture.

Denim has been used in the United States since the mid-19th century. Denim initially gained popularity in 1873 when Jacob W. Davis, a tailor from Nevada, manufactured the first pair of rivet-reinforced denim pants. The popularity of denim jeans outstripped the capacity of Davis’s small shop, so he moved his production to the facilities of dry goods wholesaler Levi Strauss & Co., which had been supplying Davis with bolts of denim fabric.

Why are jeans always in fashion?

• Jeans has versatility.
• Butt looks better.
• Jeans are super easy to style.
• Jeans feel worth the investment.
• Jeans are always durable.
• Jeans hide stains so well.
• No worries for washing it regularly.

Jeans are one of the few items of clothing that never truly go out of fashion. If you’re getting dressed up or simply tossing something on for a relaxed day out, a good pair of jeans always does the trick. Over the years, denim has taken on countless forms, but two of the most talked-about styles are skinny jeans and baggy jeans. Skinny jeans are tight, whereas baggy jeans are loose and relaxed in fit. Both trends have had their time in the spotlight, with each putting its own twist on the denim world.

Let’s begin with skinny jeans, a style known for its tight, form-fitting design that hugs the body from the waist to the ankles. Made with stretchy fabrics like elastane or spandex, they offer a close yet comfortable fit, making them particularly popular among younger generations who want both comfort and style. In the mid-2000s, celebrities and rock stars made skinny jeans a fashion staple. They were a step toward slimmer and more form-fitting shapes. They’re very easy to pair with almost anything because of how sleek they are, whether you’re going for a casual look or to go out in the evening. For women, wear them with crop tops or sweaters that are too big on them. For men, wear them with fitted shirts or thick knit pullovers to balance out the slim fit. When it comes to shoes, women can wear ankle boots, high-top sneakers, or heels. Men can wear sneakers or Chelsea boots. Belts and necklaces worn stacked on top of each other can give an outfit more style.

Skinny jeans come in different cuts, like cropped, high-rise, and mid-rise, so you can style them to fit your body type and style. They are especially good for slim or petite body types because they make the legs look longer. Some find them uncomfortable if the fit is too tight or the fabric isn’t stretchy enough. Also, the tight fit may make it hard to move, so they may not be the best choice for days when you want to be busy. In warmer climates, the tight fit and thicker fabrics can make skinny jeans less breathable, contributing to discomfort. Although they can be worn in many situations, they might not be the best choice for more formal events or places of work with strict dress code. Even with these problems, skinny jeans are still a clothing essential and can make a strong fashion statement if worn in the right way.

Baggy jeans, on the other hand, are loose-fitting denim pants that offer a relaxed look. In the 1980s and 1990s, baggy jeans were popular with streetwear and hip-hop culture. But as skinny jeans became more popular in the 2000s, baggy jeans slowly lost their appeal. However, during the pandemic period in 2020-2021, the demand for comfort led to a resurgence of relaxed fits like baggy jeans. This change also shows how fashion tastes vary between generations. Gen Z likes the open, laid-back fit, while Millennials grew up wearing skinny jeans and might still be in denial about the trend’s revival.

For women, baggy jeans pair well with fitted tops like form-fitting tees or cropped jackets. Men style them with oversized T-shirts, hoodies, or flannel shirts for a relaxed vibe. Footwear like sneakers, loafers, or boots completes the look, with accessories adding a personal touch. The extra volume can make some looks look heavy, so they might not work for all body types. Because they are relaxed, it is harder to dress up or wear them to a more formal event. However, loose jeans are still a great choice for people who like to mix comfort and style.

Skinny jeans and baggy jeans each bring something different to the table. Skinny jeans offer a sleek and versatile look, while baggy jeans bring comfort and a laid-back vibe. It all comes down to your own taste and what makes you happy. In the end, the best choice is the one that makes you feel good about yourself and keeps you comfortable.

The Apparel Digest Report

ThredUp is taking the lead in changing how people interact with fashion in a world where sustainability and over consumption are growing issues. Founded in 2009 and headquartered in Oakland, California, ThredUp is an online marketplace that provides a seamless experience for both buyers and sellers of used clothing, accessories, and shoes. The company primarily serves customers in the United States and Canada, offering shipping within these regions. Yet it’s ThredUp’s wider vision that sets it apart, working to make secondhand fashion accessible and mainstream while contributing to the growing movement toward sustainable consumption.

For sellers, the procedure is straightforward. They start by requesting a Clean Out Kit and sending in lightly used apparel using ThredUp’s pre-paid label. ThredUp carefully examines each item after it is received to make sure it satisfies their quality requirements. AI-powered technologies are then used to process accepted items, helping with pricing, photography, and classification. For effective handling, every item is assigned a QR code and passes via an automated system.

Following processing, the goods are put up for sale on ThredUp’s marketplace. Tens of thousands of inspected used goods, many from luxury or designer labels, are available for buyers to peruse at discounts of up to 90% off suggested retail pricing. Each sale generates a commission for the seller, with rewards depending on the brand and resale value of the item. For instance, a compensation of 30% to 60% of the listing price may be obtained for items priced between $50 and $99.99.

In order to ensure that the item’s life cycle is prolonged in an environmentally friendly way, sellers can choose to recover unsold items or let ThredUp recycle or donate them through its network of partners. ThredUp does not discard unsold inventory directly. Instead, it partners with aftermarket firms such as Bank & Vogue, which help redistribute garments to global markets. This includes reselling or reprocessing items that might otherwise go to waste.

In 2018, ThredUp started giving companies and retailers access to its platform so they could engage in direct resale. Since then, this project has developed into a full-featured Resale-as-a-Service (RaaS) platform. To make things easier for its partners, ThredUp is now removing the costs related to branded resale and introducing improved services.

This calculated action was taken since the secondhand market is becoming more and more involved with unsold inventory and returned goods, two areas where many brands encounter logistical challenges. By providing its operational infrastructure and reselling technologies to partners completely free of charge, ThredUp hopes to help resolve this issue.

ThredUp intends to provide a peer-to-peer resale marketplace that companies can integrate into their own resale shops before the end of the year, along with enhanced integration tools to better handle returns.

Released in March 2025, ThredUp’s 13th annual Resale Report offers a thorough overview of the US secondhand clothing market, highlighting the sector’s remarkable development and key trends.

• Market Growth: In 2024, the U.S. market for used clothing expanded by 14%, the most since 2021. In the same year, online resale climbed by 23 percent, five times faster than the whole retail clothes market. By 2029, the market is expected to grow to $74 billion, with online resale almost doubling to $40 billion during that time.
  
  
• Consumer Shifts:59% of customers stated that if trade and tariff policies increased the cost of clothing, they would look for less expensive options, such as used clothing. With 69% of Millennials saying they would prefer used options in these economic times, this is especially important to them. Additionally, in the upcoming year, shoppers intend to spend 34% of their clothing budget on secondhand goods, with Gen Z and Millennials spending close to 46%.
  
  
• Retailer Adjustments: 44% of fashion retailers want to lessen their dependency on imported items, and 80% of them anticipate that new trade and tariff policies will upset their global supply networks. It’s interesting to note that, despite possible tariff swings, 54% of shops think resale offers a more reliable and consistent source of goods.

• Technology and Personalization: Artificial intelligence (AI) and cutting-edge technologies are completely changing the way people purchase for used goods. According to 48% of consumers, shopping secondhand is as simple as shopping new because to personalized features and enhanced search and discovery. Among younger generations, this percentage jumps to 59%. Furthermore, 39% of younger consumers buy used clothing via social media sites, indicating the growing popularity of social commerce.

ThredUp has handled more than 172 million unique pre-owned items from over 55,000 brands and 100 categories. While it abandoned the European market in December 2024 by selling Remix (which it had bought in 2021), its goal continues to become the industry’s worldwide recommerce layer.

This strategy positions ThredUp not only as a resale platform but also as a key enabler of circular retailing. It aims to create a sustainable and scalable system by integrating resale directly into brand ecosystems and utilizing technology to make the process as smooth as possible and enhance the secondhand shopping experience.