"Apparel exporters feel pricing pressure from European buyers", 26 July 2025

Bangladeshi apparel exporters are getting under fresh pricing pressure from European buyers under shadows of a predeclared steep US tariff hike as they increasingly shift focus to the European Union in quest of new orders to fill production gaps, industry-insiders say.

Most US buyers are refraining from placing new orders due to the uncertainty surrounding the potential tariff rises, prompting manufacturers to turn more actively to the EU market.

Industry people have said European buyers are taking advantage of the situation, attempting to lower product prices as thousands of Bangladeshi exporters approach them in a scramble for orders.

"The share of orders from US buyers has fallen to about 50 per cent. To bridge this gap, apparel exporters are now exploring opportunities with EU buyers," says S.M. Majedur Rahim, Director at Giant Group.

"Even when US buyers are placing orders, the volumes are small. Some have already offered lower prices for repeat orders, citing tariff pressure. It's unfair to expect exporters to bear the cost of tariffs," he adds.

Major EU retailers such as H&M and Inditex...have reportedly reduced their order volumes by 10 to 20 per cent out of fears surrounding the oncoming US tariffs...

"European buyers are viewing this as an opportunity to renegotiate and reduce apparel prices -- even some have already done so," he further notes.

EU buyers trying to capitalise on tariff pressure: "One of my buyers from the Netherlands, who used to purchase garments at $3 per unit, has now offered a price that is 25-30-cent lower per unit, citing Trump-era tariff policies," said Fazlee Shamim Ehsan, CEO of Fatullah Apparels.

"I couldn't accept the order at that price. The total value of the order was \$750,000. Losing the deal has made it difficult to keep the factory running," he added.

...exporters had earlier warned that the impact of US tariff hikes could spill over into Europe -- the largest trade bloc.

"Due to the new US tariff policy, inflation has already risen on that market, and buyers have started reducing their apparel orders," Ehsan observed.

He further noted, "The ripple effects of the new US tariffs have begun to influence European buyers as well. Some of them are now offering lower prices than before."...

Echoing Shovon's concerns, the country manager of a European apparel brand, speaking on condition of anonymity, said, "If the tariff issue is not resolved in Bangladesh's favour, it could reduce our business opportunities here."

He further stated, "Although the US market accounts for less than 10 per cent of our total sales, it would no longer be a viable business case for us to produce goods for them from Bangladesh. We may have to consider alternative sourcing options."...

The head of business development at PDS Group-the largest multinational buying house in Bangladesh-also speaking on condition of anonymity, said, "Some of our EU customers are now asking for price reductions on new orders."

He added that EU buyers are taking advantage of the situation, being aware of the global market scenario and the installed capacity of the Bangladeshi apparel industry.

Officials at the buying house further noted that orders from some promising non-traditional markets -- such as India and South Korea -- are also shrinking. This is due to factors that include non-tariff barriers in India and local political as well as global economic challenges in South Korea....

Currently, Bangladesh exports to the US at an average tariff rate of 15.5 per cent. If the proposed 35-percent reciprocal tariff is finally imposed, the total tariff burden would rise to an uphill 50.5 per cent.