Canadian retailers are moving production out of China due to tariffs and human rights concerns, reshaping their supply chains.
It’s not just about the tariffs, though. There are serious concerns about human rights issues, especially regarding forced labor in regions like Xinjiang. Companies are realizing they can’t rely too heavily on China anymore.
Groupe Dynamite’s CEO mentioned they’re already shifting production out of China. They’re not alone; many brands are looking to diversify their manufacturing. It’s a smart move, especially with rising tensions between the U.S. and China.
Even Canadian Tire is seeing a big change in where they source their products. They’re feeling more secure now that they’re not as dependent on China as they were before.
Aritzia has been expanding in the U.S. and has been working on diversifying its manufacturing since going public in 2016. They’re now producing most of their products outside of China.
Lululemon is also in a good spot, with only a small percentage of their goods coming from China. They’re keeping their exposure low, which is a smart strategy.
But it’s not easy to completely untangle from China. Many businesses find it challenging to find alternative suppliers that can match the quality and variety that China offers.
As the situation evolves, it’ll be interesting to see how Canada supports companies looking to make this shift. Other countries, like Japan, are already offering incentives to help businesses move their production.
