China's garment industry is at a critical juncture. In the first half of 2026, export pressure persisted while domestic sales grew steadily, driven by consumption stimulus policies and the rising guochao (national trend) culture. This "cold outside, hot inside" divergence has made the strategic choices for the 15th Five-Year Plan (2026-2030) particularly sensitive. At the 8th second council meeting of the China National Garment Association held in Huizhou on June 25, a clear timeline was set: to build a garment brand powerhouse by 2035. This means the next five years must see a decisive shift from manufacturing scale to brand value.
Export Headwinds and Domestic Shifts
The core judgment from industry leaders is that current difficulties are not cyclical. Weak international demand, geopolitical tensions, and supply chain disruptions continued to weigh on apparel exports in H1 2026. Meanwhile, domestic sales maintained rapid growth thanks to consumption stimulus, but shrinking investment and severe profit pressure indicate the sector is still in a profit trough.
Notably, niche segments like guochao, outdoor sports, and the silver economy emerged as bright spots. These are not accidental—they reflect a consumer shift from functional needs to emotional and identity-driven purchases. For buyers and factories, this means the old model of large-volume, standardized orders is fading. Small batches, quick response, and strong cultural attributes will become the main profit drivers.
AI and Digitalization: From Tools to Ecosystem Overhaul
Two case studies shared at the meeting—Lingdi Technology and Glorious Sun Group (Jeanswest)—reveal the depth of digitalization's penetration. Lingdi's "third paradigm shift" is not mere hype: the fusion of generative AI, industrial simulation, and embodied intelligence is reshaping the ecosystem in three dimensions. In design, AI turns designers into curators, compressing R&D cycles. In manufacturing, intelligent factories can capture tacit process knowledge and optimize quality control. In supply chain, real-time collaboration networks among brands, factories, and consumers emerge, with digital twins becoming a new entry barrier.
Jeanswest's transformation path offers more practical reference. From launching its digital brand ecosystem in 2018 to upgrading to an AI agent matrix in 2025, its core logic is the synergy of three capabilities: product development, precision operations, and supply chain integration. The key is systematic infrastructure—including university-industry collaboration centers and reusable data assets. For small and medium factories and brands, digital investments without top-level design easily become fragmented and redundant—a trap the industry must avoid.
Eastern Aesthetics and Brand Globalization
A significant consensus from the meeting is that Eastern aesthetics has become an irreplicable competitive moat for local brands in the global fashion context. This goes beyond the guochao trend—it's a systematic output of brand values, aesthetic systems, and spiritual core. In brand globalization, pure low-price competition has failed. Reshaping overseas consumers' perception requires high value-added products and cultural narratives.
Practically, this means brands need to organically integrate traditional craftsmanship, color symbols, and modern wearing scenarios. For fabric and garment suppliers, products with Eastern aesthetic elements (e.g., modified frog buttons, embroidery, natural dyes) are commanding higher premiums in overseas mid-to-high-end markets.
Three Transition Pathways: Tech, Brand, and Responsibility
Sun Ruizhe, president of CNTAC, outlined a five-dimensional development thinking—intelligent economy, science-innovation economy, service economy, responsibility economy, and open economy—which essentially draws a clear roadmap. Among them, the responsibility economy, covering green and adaptive fashion, is shifting from a cost item to a competitive advantage. Full lifecycle carbon footprint traceability and recyclable materials are becoming entry barriers in Europe, not just bonuses.
Overall, the industry transition hinges on three pillars: ambition (brand powerhouse goal), fundamentals (basic innovation and quality), and novelty (digitalization and cross-sector collaboration). For supply chain players, this means balancing long-term patience (slow variables like process refinement and brand reputation) with rapid iteration (acceleration from AI and flexible production).