This article is the first in a new series where we unpack what the ‘Made in the UK’ label stands for in 2025, and what it tells us about the future of onshoring. Read our series on ‘Made in Italy’ here, and Made in India here.
For centuries, the UK was a global powerhouse of textile and garment production, synonymous with quality and craftsmanship, from the knitwear mills of Scotland and lace producers of Nottingham, to the shoemakers of Northampton and the tailoring houses of Savile Row. But in the last few decades, globalisation, offshoring, economic pressures, shifting retail models and Brexit have steadily eroded the UK’s manufacturing power.
Now, the looming prospect of a global trade war — prompted by heightened tariffs under President Trump — is forcing brands around the world to reconsider how and where their products are made. At the same time, rising import costs, supply chain fragility and incoming transparency and sustainability legislation are funnelling those discussions towards reshoring. Suddenly, it seems like ‘Made in the UK’ has a lot to offer.
Proponents say local manufacturing could offer British brands and retailers easier oversight, fewer carbon emissions and shorter lead times. That, in turn, would reduce waste, boost full-price sell-through and make on-demand or small-batch production more viable. They insist that the UK could rebuild a thriving, modern fashion manufacturing sector — one that combines heritage craftsmanship with cutting-edge technology, and creates jobs. “For British brands, making in the UK is not only important to offset global trade issues, but also to build local economies,” says Tamara Cincik, founder of policy think tank Fashion Roundtable.
However, the industry remains fragmented, facing major challenges such as skills shortages, high operational costs, and a lack of government support. Many UK manufacturers rely on imported yarns and trims, and soaring energy prices and wage bills are challenging their margins. Without targeted investment — and a more unified vision for the future of ‘Made in the UK’ — there’s a risk that the current reshoring momentum could stall.
The decisions made in the next few months and years will determine whether the UK can reposition itself as a serious player in global fashion production, or cedes further ground to more competitive markets.
“We have an opportunity to build a more resilient, sustainable and competitive UK supply chain,” says Adam Mansell, CEO of the UK Fashion and Textile Association (UKFT). “There is an appetite there, there is interest there. But the infrastructure and investment need to be there to support it. If we don’t act now, we risk losing even more of our domestic production capabilities to overseas competitors.”
A perfect storm of challenges
During 14 years of Conservative (or Tory) Party rule, which stretched from 2010 to 2024, the UK fashion and textile industry suffered from the lack of a long-term national strategy. Creative fashion thrived culturally — London Fashion Week remains a global fixture (albeit facing its own challenges) — but production and supply chain investment lagged behind.
Cuts made in the wake of the 2008 global financial crisis decimated funding for vocational training and further education, hampering the development of specialist skills essential for textile innovation and manufacturing. As a result, the UK supply chain that exists today is fragile. Cluny Lace is the only Nottingham-based lace manufacturer left. Leather tanneries specialising in fashion goods are similarly low in numbers. At each stage of the supply chain, crucial components are now missing. “Little chinks in the supply chain — like if a dye house or a small supplier is hit really hard with rising costs and has to close — can have a massive impact,” says Kate Hills, founder of consultancy and campaign organisation Make It British.
Then came Brexit. With the end of frictionless trade, UK manufacturers faced increased costs and customs delays. Exports to the EU — a key market for British-made luxury goods — dropped significantly, while SMEs struggled to navigate the bureaucracy. Government-led support was piecemeal at best, and the UK’s reputation as a reliable manufacturing hub faltered.
“Brexit was — is — a disaster for manufacturing,” says Patrick Grant, who founded British fashion brand Community Clothing in 2016 to provide consistent employment for a co-operative of British mills and factories, including his Blackburn-based textile manufacturer Cookson Clegg (he is also a judge on the TV programme The Great British Sewing Bee). “Brexit has created impediments to trade in an industry that was already very competitive, making it more difficult to buy things from — and sell things into — Europe. We’ve diminished the size of our market.”
Many in the industry therefore welcomed Labour’s return to power in July 2024. However, recent tax and minimum wage hikes are a bitter pill to swallow. The biggest barrier to making in the UK — cited by manufacturers and brands alike — is the cost, largely because the UK has one of the highest minimum wages in the world. In October, the UK government increased national insurance (a tax on earnings and self-employed profits, paid by employees, employers and the self-employed), making British labour even more expensive. This, alongside rising energy prices, raw material costs and inflation, is impacting production.
“Supplier prices are high, even compared to Italy and other European countries,” says Ashley Long, CEO of British brand Paul Smith, which makes some of its range in the UK, though the company declines to provide the exact percentage. “But where a lot of European businesses benefit from government assistance, from grants to concessions that support manufacturing, we don’t benefit from this in the UK.”
There are a number of other obstacles to scaling up UK production, not least the disruption to retail. When Matches collapsed just over a year ago, it owed unsecured creditors — namely brands and manufacturers — more than £35.6 million, most of which was never repaid. Many of its e-commerce peers have struggled, too, while the removal of VAT-free shopping has hindered growth for bricks-and-mortar stores, especially in London’s West End, where luxury shopping is concentrated. At the mass end of the market, the British high street has been decimated by the availability of cheap fast fashion online. “The challenges in UK retail have hit manufacturing hard,” says Hills. “If people aren’t selling as many products, they’re not going to make as many products.”
The need for tangible policy support
While most in the industry agree that greater government involvement could significantly boost ‘Made in the UK’ fashion, not many are holding their breath. Across party lines, UK legislators have shown little interest in rallying the fashion industry, and the sparse examples of government investment show a fractured vision for what rebuilding would look like.
One faction is pushing for the UK to set itself apart through circular and sustainable innovations. For example, in August 2023, non-departmental public body UK Research and Innovation (UKRI) invested £6 million to help the fashion and textile industry adopt sustainable and responsible practices. Using some of that funding, the UKFT and British Fashion Council (BFC) now co-chair the Circular Fashion Innovation Network, which promotes sustainable manufacturing and circular business models. (The BFC also leads the government-backed Low Carbon Transition Programme, which supports UK-based fashion SMEs to decarbonise, among other initiatives more targeted at the design side of the industry.)
But ‘Made in the UK’ advocates argue that there needs to be larger-scale investment in reshoring. “There are some people doing some really good work, but it’s not coming from the top. It’s not coming through policy support or grants,” says Jacqueline Farrell, education director at The King’s Foundation, the charity set up by King Charles to work towards a more sustainable future, including teaching fashion and textiles skills, and regenerative agriculture practices. “Unlike, say, the STEM and farming industries, there’s no national approach to developing the fashion textile industry.”
Some point to the fact that the Italian government allocated €250 million to boost its homegrown fashion businesses in 2025. “The Italian government sees the value in the Italian fashion and textile manufacturing industry and supports it to the tune of tens of millions of euros every year. The same applies in France, the same applies in Germany,” says Mansell. “Unfortunately, despite the best efforts of the UKFT and BFC, the amount of money that we get directly for supporting companies is in the tens of thousands a year. It’s that marked a difference. One of our biggest challenges is getting the UK government to understand the economic value of the industry.”
Insiders hope for a shift from rhetoric to tangible policy. That means strategic investment in textile hubs from Yorkshire to the Midlands, reskilling programmes in garment making and technical design, and financial incentives for onshoring and circular economy initiatives. There’s also anticipation around trade negotiations — especially with the EU — that could ease supply chain frictions and re-establish the UK as a competitive sourcing option for European brands. The policy wishlist is long. However, no one is under the illusion that extra funding or robust policies will materialise overnight.
Rising up the agenda: Procurement and tax breaks
Relying on post-Brexit trade negotiations certainly isn’t a quick fix. Where many in the industry are focusing their attention instead is on government procurement contracts as a way to stabilise UK supply chains in the near-term. If UK manufacturers were prioritised for procurement contracts — spanning from school uniforms and NHS scrubs to ceremonial dress and military kit — industry insiders say it could provide a gateway to both scale and skills. This came up near-unanimously across all of our interviews with manufacturers, suppliers, brands and academics.
In 2023, the UK government brought in the Procurement Act with the aim of making the contract bidding process more flexible, transparent and accessible for businesses, especially small and social enterprises. However, there is no stipulation that contracts should be fulfilled via UK manufacturing. And even if UK manufacturers win the contracts, they have the option of outsourcing fulfilment to anywhere else in the world.
Procurement decisions can be make or break for UK manufacturers, says Hills, pointing to Scottish manufacturer Haven Products, which last year lost its contract to make nurses’ uniforms for the NHS. “They lost £1 million in turnover overnight. Now they’re like, ‘how are we going to get a million pounds worth of business from all these small guys altogether?’ It’s a lot more admin work, and it’s the knock-on effect it has on the fabric people, the dye houses, the finishers, everything.”
Tax breaks are also high on the priority list. Fashion Roundtable is lobbying for tax incentives for B Corps and companies with proven positive social and environmental contributions who commit to manufacturing in the UK. It says this is currently enjoyed by certain television programmes and films that make scripted productions in the UK, but not by the fashion industry. “Incentives are key — carrot, not stick,” says Cincik.
Grant and Hills are among those also arguing for a change in value-added tax (VAT) rules. “You could do something very simple like vary the VAT based on the amount of local content [in a product],” Grant suggests. “You would actually be generating more tax by incentivising the creation of local jobs.”
Asked whether the government has any plans to introduce targeted tax incentives to encourage investment in fashion and textile production in the UK, a spokesperson for the Treasury pointed to its commitment to cap corporation tax at 25 per cent (across all industries). “We are a pro-business government determined to provide the stability needed for businesses, including fashion and textiles, to make long-term investments and support our Plan for Change [the policy aims Prime Minister Keir Starmer presented to Parliament on 5 December 2024] by kickstarting growth,” the spokesperson said.
On procurement, a spokesperson for the Cabinet Office said the government’s new ‘National Procurement Policy Statement’, published in February, is making it “easier for the £400 billion spent each year in public procurement to be focused on local British firms”, but did not elaborate further.
Challenging entrenched brand thinking
Reviving the UK’s fashion manufacturing sector doesn’t hinge on government policy and funding alone. The support and investment needed is likely to come from a blend of public and private sources, including brand-led or industry consortia, and impact investors focused on sustainability. Collaboration across sectors — linking fashion with agriculture, education and innovation — is unlocking new types of funding, particularly for projects focused on circularity, regenerative systems and supply chain transparency.
Brands and manufacturers have a critical role to play in incentivising and de-risking this investment. By demonstrating successful collaborations, embracing circularity and actively communicating their progress, manufacturers can help to shift perceptions of risk and strengthen the case for funding UK-based production. Brands, meanwhile, can share the cost and risk of innovation — through joint R&D, pre-orders or co-investment in local infrastructure — and prioritise suppliers that offer transparency.
Experts stress the need for longer-term partnerships and guaranteed volumes from brands — however small — to help manufacturers plan staffing, invest in equipment and remain operational. This is why the push for procurement is so strong. “I would like to see retailers make a commitment to the suppliers to say, ‘X percentage of our production will be with you’. We don’t know the style yet. We don’t know the fit, we don’t know the fabric, but we are going to keep you busy and you can plan for that and you can staff for that,” says Simon Platts, sourcing consultant and former sourcing director at British fashion e-tailer Asos. “That gives manufacturers the confidence to scale.”
To help get there, work is underway to convince buyers that British production can be a more economical choice than relying heavily on overseas factories, if you look beyond the upfront cost. The globalised model of production often leads to over-ordering, with long lead times forcing brands to gamble on consumer demand. “Roughly 40 per cent of imported garments don’t sell at full price,” says Jenny Holloway, founder of London-based manufacturer Fashion Enter and newly appointed chair of the Apparel Textile Manufacturers Association. “That’s profit left on the table — it’s not just wasteful, it’s economically unsound. Yes, the unit cost is higher. But when you factor in everything else — overproduction, shipping, markdowns and returns — the margin story flips.”
Former PVH chief supply chain officer and now independent consultant Bill McRaith is hoping to convince more brands and retailers of this via Project Interlace, his initiative that crunches the numbers on how a more balanced mix of onshoring and nearshoring, combined with offshoring to further-flung countries, can benefit the bottom line. “We recognise in the modelling that the product will cost far more to make in the UK, but it doesn’t matter because you’re only making the stuff that will sell,” he explains.
“It’s more complex upfront, and yes, your margin might look smaller,” says British fashion designer Maria Grachvogel, who transitioned her business to a made-to-order model with UK-based factories years ago. “But I’m not sitting on excess inventory or spending a fortune fixing production issues from abroad. I know what I’m making will sell. It’s slower at first, but much more sustainable — financially and environmentally — in the long run.”
Manufacturers on the luxury side remain stoic. “After Covid, we had three strong years of growth. But in the last year or so, luxury demand has slowed, and we are looking at supply chain pressures, inflation, national insurance rises, and all kinds of environmental challenges including decarbonisation,” says Chris Gaffney, CEO of Scottish mill and knitwear brand Johnstons of Elgin, which makes for the likes of Burberry and Hermès. “But at the same time, we are very confident in the future of global luxury. There’s still economic growth in places like China and India.”
The importance of storytelling
Educating consumers is another piece of the puzzle. If brands want to charge a premium for British-made garments, they must invest in storytelling that resonates. “If brands are not able to justify the cost of making in the UK, it’s because the end consumer doesn’t see high enough value in something that is made in the UK or uses British fibres as opposed to Chinese manufacturing or acrylic fibres, for example,” says Jess Mcguire Dudley, managing director of knitwear brand and manufacturer John Smedley. “Brands need to educate their consumers.”
Brands willing to open up their supply chains to consumers — and explain the choices behind them — are more likely to win long-term trust. Grassroots initiatives are cropping up across the UK that set a blueprint for a more transparent model, such as Herd’s field-to-fibre model, and British Pasture Leather’s mission to revive leather production — both of which encourage consumers to learn about how and where their products are made.
“Brands are increasingly telling the stories of their connection to our country that are resonating with global consumers. They are also shining a light on their supply chains, which speaks to a customer who is more engaged with the provenance and the story of the product than ever before,” says Helen Brocklebank, CEO of British luxury trade body Walpole. “All of this is a huge opportunity for luxury fashion brands who manufacture in the UK and can tell that story of brand and national heritage.”
Storytelling and cross-sector partnerships will help to build momentum and prove the business case for investing in British manufacturing. “It’s not a pipe dream,” says Mansell. “The world has changed rapidly over the past five years. Be it circularity, transparency, or innovation in manufacturing techniques — it’s all pointing to a much greater likelihood of having some volume manufacturing back in the UK. It’s going to take investment and quite significant investment, but you can paint a picture that is not difficult to realise. It’s almost within touching distance.”
With additional reporting by Bella Webb
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