It has been a long, difficult past year and a half for American garment making. In the past 17 months, 23 American garment brands shut down, most of them small producers like cycling apparel maker Kitsbow and Nutmeg Needleworks, according to David Billstrom, former CEO of cycling apparel maker Kitsbow and owner of business advisory practice Flashing Red Light. What’s going on? The current proximate cause is the de minimis provision of 1930s Smoot-Hawley Tariff, or more specifically its exploitation by companies like Temu and Shein. That provision exempts packages worth less than $800 from customs scrutiny, and direct-to-consumer offshore retailers like the two mentioned are therefore able to avoid duties and undercut the competitiveness of domestic producers.
