In the first quarter of 2026, China's garment industry actively responded to the difficulties and issues such as the weakness of international market demand and the disturbance of the Middle East geopolitical situation. With the support of the steady recovery of the domestic economy and the implementation and effectiveness of various policies to expand domestic demand, the overall economic operation of the industry was basically stable, production and domestic sales maintained a recovery growth, exports showed strong resilience, but enterprise profits were seriously under pressure, and investment fell rapidly.

Looking ahead to the whole year, in the face of the complex and severe external development situation, China's garment industry still needs to effectively prevent and resolve various risks and challenges such as the intensification of geopolitical conflicts, the warming of trade protectionism, and the restriction of international shipping, accelerate the cultivation of new productive forces, solidly promote the construction of modern industrial systems, continuously consolidate and improve the advantages of industrial base and development resilience, and strive to promote the stable recovery and development of the industry economy.

1. The Economic Operation of the Garment Industry

(1) Garment Production Recovers Steadily In the first quarter, China's garment industry chain operated orderly and benignly, and the industrial added value and garment output of the above-scale enterprises both maintained a slight increase, with the growth rate steadily recovering compared to 2025. According to the data of the National Bureau of Statistics, from January to March, the industrial added value of the garment industry above the designated size increased by 3.1% year-on-year, a recovery of 6.1 percentage points from the full year of 2025; the output ofgarments in above-scale enterprises increased by 1.36% year-on-year, a recovery of 4.80 percentage points from the full year of 2025. From the perspective of sub-categories, the output of wovengarments increased by 0.70% year-on-year, among which the output of down jackets, suit sets and shirts decreased by 0.99%, 1.33% and 9.84% year-on-year, respectively; the output of knittedgarments increased by 1.66% year-on-year.

(2) Domestic Sales Achieved Good Growth In the first quarter, China's domestic macro-economy achieved a good start, the national policies to boost consumption took effect in coordination, and the demand for consumption was released in a concentrated way during the Spring Festival holiday, which supported the rapid growth of China's domestic clothing market. According to the data from the National Bureau of Statistics, from January to March, the retail sales of clothing in China's limited above units cumulated 303.26 billion RMB, a year-on-year increase of 9.4%, which was 6.6 percentage points faster than the full year of 2025. Among them, the retail sales of clothing in limited above units increased by 10.7% and 6.6% year-on-year in January-February and March, respectively. During the same period, online clothing sales accelerated significantly, and the online retail sales of clothing increased by 11.6% year-on-year, which was 9.7 percentage points faster than the full year of 2025.

(3) Exports are under pressure and show resilience In the first quarter, against the backdrop of weak international market demand, intensified geopolitical conflicts, and rising uncertainties in trade policies, export enterprises actively responded to the difficulties and risks such as the increase in international shipping costs and the obstruction of order delivery, and China's clothing exports remained basically stable, showing strong resilience. According to the data from the General Administration of Customs of China, from January to March, China's cumulative clothing and apparel exports amounted to 32.89 billion US dollars, a year-on-year decrease of 0.4%, which was 1.5 percentage points narrower than the decrease in the same period of 2025 and 4.6 percentage points narrower than the full year of 2025. From the relationship between quantity and price, the trend of clothing exports continued to show the pattern of increasing quantity and decreasing price. The export quantity was 8.38 billion pieces, a year-on-year increase of 6.6%, and the export average unit price was 3.2 US dollars/piece, a year-on-year decrease of 6.2%. From the monthly export, the export growth rate showed large fluctuations. In January-February, the clothing export increased by 14.8% year-on-year, driven by the concentrated delivery of orders before the holiday. In March, due to the "rush export" to the United States in the same period last year, which pushed up the base, the clothing export decreased by 29.4% year-on-year.

From the sub-category, the export amount of ready-to-wear suit and coat increased by 22.6% and 6.2% year-on-year, and the export amount of suit and coat, T-shirt and sweater increased slightly by 0.3% year-on-year. The export amount of other major categories of clothing all decreased. The export amount of trousers, dress and shirt decreased by 0.6%, 5.3% and 0.5% year-on-year, respectively. The export quantity of down jacket increased by 1.4% year-on-year, and the export unit price decreased by 10.5% year-on-year.

From the perspective of major markets, the structure of China's clothing export market is accelerating adjustment, with the United States, Europe, and Japan showing differentiated trends, and emerging markets such as Latin America and Africa maintain relatively fast growth. According to China's customs data, from January to March, China's clothing exports to the United States amounted to $7.25 billion, a year-on-year decrease of 2.5%, narrowing by 9.5 percentage points from the full year of 2025; exports to the EU amounted to $5.24 billion, a year-on-year increase of 4.9%, accelerating by 1.9 percentage points from the full year of 2025; exports to Japan amounted to $2.8 billion, a year-on-year decrease of 4.3%, narrowing by 5.2 percentage points from the full year of 2025; during the same period, China's clothing exports to ASEAN, "the Belt and Road" countries and regions narrowed. Among them, exports to ASEAN amounted to $2.72 billion, a year-on-year decrease of 8.4%, narrowing by 11.2 percentage points from the full year of 2025; exports to "the Belt and Road" countries and regions amounted to $8.14 billion, a year-on-year decrease of 5.6%, narrowing by 4.4 percentage points from the full year of 2025. In addition, China's clothing exports to Latin America and Africa increased by 8.7% and 29.7% year-on-year, respectively, and China's clothing exports to Russia increased by 56.5% year-on-year, and China's clothing exports to Australia increased by 11.8% year-on-year.

From the perspective of export provinces, the eastern region is still the main concentration of China's clothing exports, and some provinces in the central and western regions have outstanding export performance. According to China's customs data, from January to March, the eastern region's clothing exports amounted to $27.1 billion, a year-on-year increase of 3.4%, accounting for 82.4% of the total clothing exports in the country. Among the top five provinces in clothing exports, Zhejiang's clothing exports increased by 6.4% year-on-year, Guangdong's clothing exports turned from negative to positive, and increased by 19.9% year-on-year; Jiangsu, Shandong, and Fujian's clothing exports decreased by 5.4%, 10.6%, and 3.0% year-on-year, respectively. Some central and western provinces and border provinces have achieved rapid growth through market expansion and policy empowerment, among which, driven by the accelerated release of the free trade port's closure policy dividend, Hainan's clothing exports increased significantly by 799.8%; Yunnan, relying on its geographical advantages and the preferential tariff policy of RCEP, has a remarkable performance in clothing exports, increasing by 294.7% year-on-year. At the same time, Xinjiang, Guangxi, and Hubei's clothing exports decreased by 21.4%, 28.8%, and 27.2% year-on-year, respectively.

(4) Enterprises are under severe profit pressure In the first quarter, due to the weak demand in the international market, the rise in comprehensive costs, and the decline in export prices, the profitability of China's garment industry has been slowly repaired. Although the decrease in operating income and total profit has narrowed, the overall trend still continues the contraction of 2025, and the profitability of enterprises is seriously under pressure. According to the data from the National Bureau of Statistics, from January to March, there were 12,541 enterprises in China's garment industry with a scale above the limit ( annual main business income of 20 million RMB or more), which achieved an operating income of 242.568 billion RMB, a year-on-year decrease of 1.71%, narrowing the decrease of 11.50 percentage points compared to the whole year of 2025; the total profit was 54.15 billion RMB, a year-on-year decrease of 17.76%, narrowing the decrease of 9.58 percentage points compared to the whole year of 2025; the operating income profit rate was only 2.23%, a year-on-year decrease of 0.44 percentage points, lower than the whole year of 2025 by 1.82 percentage points.

The industry's loss-making rate has expanded, and the operational efficiency has declined somewhat. From January to March, the loss-making rate of the garment industry's enterprises above the limit was 35.60%, expanding by 1.02 percentage points compared to the same period in 2025; the three expenses ratio was 11.65%, rising by 0.56 percentage points compared to the same period in 2025; the inventory turnover rate, accounts receivable turnover rate, and total assets turnover rate were 9.13 times/year, 5.52 times/year, and 0.99 times/year, respectively, decreasing by 3.36%, 3.68%, and 4.32% year-on-year, respectively.

（5）The investment growth rate has rebounded rapidly Due to the increasing operational pressure of enterprises, the high base of the previous year, and other constraints, China's garment industry fixed asset investment has rebounded rapidly. According to the data from the National Bureau of Statistics, from January to March, the fixed asset investment in the garment industry decreased by 4.1% year-on-year, a decrease of 27.0 percentage points compared to the same period in 2025, and a decrease of 9.3 percentage points compared to the whole year of 2025.

2, the characteristics of the garment industry development in the first quarter

（1）Multiple factors have intensified the operational pressure of enterprises Currently, due to the combined impact of factors such as unstable international market demand, intensified domestic market competition, high operating costs, and rising various fees, the overall operational pressure of apparel industry enterprises has further increased. Against the backdrop of insufficient international market impetus and disruptions in the Middle East geopolitical situation, international orders have been reduced, coupled with the rise in international shipping costs, the delivery of apparel export orders has been hindered, leading to increased fulfillment costs for enterprises, pressure on the stability of overseas cooperation, and a significant increase in operational pressure and risk. At the same time, "involutionary" competition among enterprises has led to disorderly competition and price wars, especially in online channels such as live e-commerce, which is prominent, and the return rate remains high, not only squeezing the profit margin of enterprises but also hindering the benign and orderly development of the industry. Additionally, the cost pressures of raw materials, logistics, and labor continue to be high, coupled with increased investment in market promotion, channel construction, and digital transformation, leading to a rise in operating costs and continuous pressure on profit levels.

（2）Diverse demands empower a rich and complete consumer landscape As residents' consumption concepts become more mature, the market segmentation characteristics of the apparel industry become more pronounced, and consumer demand has upgraded from basic wear to quality experience, functional attributes, and identity expression, while consumption decisions are more rational, with cost-performance, quality-price, and psychological price becoming important considerations. Industry enterprises through a gradient brand layout, precisely cover a diverse customer groups and consumption scenarios, further releasing the consumption potential of the subdivided track. Biyin Leven focuses on high-end business leisure and golf sports scenarios, relying on high-quality functional fabrics, fine cutting, and brand positioning, the first quarter of the store traffic and average order value maintain steady growth. Zhihe has been deeply cultivating the natural comfortable, simple and advanced mid-to-high-end women's clothing field, through natural fabrics, minimalist design to convey the concept of quality life, accurately meeting consumers' consumption needs for wearing texture, comfortable experience and identity expression. Balabala focuses on different growth stages of infants and children, launching subdivided products such as safe and skin-friendly, sports functions, national trend IP, covering the family's diverse consumption demands, and continuously activating the growth momentum of revenue.

（3）Brand's full-channel layout continues to be optimized Against the backdrop of the deep penetration of the digital economy and the diversified expansion of consumer scenarios, the pace of channel integration in the apparel industry has accelerated. Apparel brands are deepening the integration and application of new technologies such as artificial intelligence and cloud computing in the full supply chain, actively building an all-domain matrix online, optimizing the layout of offline terminals, and continuously solidifying the foundation of market operations and enhancing the comprehensive competitiveness of the full channel through channel complementarity and scenario linkage. Li-Ning continues to increase its all-domain layout on Douyin, Video Number, and Tmall Flagship Store, optimizing traffic precision distribution and user efficient access with the help of AI big data, and improving online sales through professional sports bloggers live broadcasting, new product launch special events, and member private domain operation. At the same time, apparel brands are actively adjusting the layout of offline terminals, optimizing channel structure, focusing on high-quality scenarios such as outlet discount stores, high-end shopping malls, and brand experience stores, fully playing the advantages of differentiated operation, and effectively improving the operational efficiency of stores. By focusing on the core business circle, Postbird has built a benchmark experience store, strengthened the scene experience, and consolidated the advantage of the core customer group.

3, Outlook on the Development Trends of the Apparel Industry in 2026

Looking ahead to the whole year, the development environment of China's apparel industry is becoming more complex and severe, with multiple challenges such as weak external demand, intensified competition, and increased supply chain risks intertwined and superimposed, and the transformation pressure of internal structural adjustment and quality improvement continues to exist. The industry still faces great tests to maintain a stable recovery and develop towards the new and good.

From the international market perspective, there is a great deal of uncertainty in apparel exports. Affected by the intensification of geopolitical conflicts, the risk of passage in the Strait of Hormuz and the Red Sea route has increased, and international logistics and transportation have been restricted, and enterprises are facing the dual pressure of rising freight rates and delayed delivery; at the same time, the additional tariffs imposed by the United States on China have been reduced to 10%, which helps to stabilize the scale of China's apparel exports to the United States in the short term, but the Sino-US trade friction is still in the stage of game theory, and there is a potential risk of tariff increase. From the domestic market perspective, with the deep implementation of the "Special Action Plan for Stimulating Consumption" and the promotion of relevant arrangements in the "15th Five-Year Plan" outline, residents' consumption confidence is gradually recovering, and diversified, multi-scene, and integrated consumption models are constantly updated, which will accelerate the release of demand potential in subdivided fields such as domestic trend apparel, sports and outdoor, and silver economy, and the positive factors supporting the stable development of the domestic apparel market are increasing.

In the face of complex and severe domestic and international development conditions, apparel industry enterprises need to focus on cultivating new productive forces, promote deep integration of digitalization and intelligence throughout the entire chain, solidly promote the construction of modern industrial systems, continuously consolidate the foundation for the stable recovery of the industry and its resilience, and promote the high-quality development of the industry economy.

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