U.S. economic woes are continuing to cause anxiety among many of the major U.S. retailers.  Across the entire U.S. retail sales market, reports are surfacing that retailers are heavily focusing on reducing inventories and limiting selections to goods that move. Christmas is the major sales season for U.S. retailers, with last year's sales reaching 469.9 billion U.S. dollars.  Given credit constraints all retailers face, the focus on limiting cash outlays at many large chains is reducing inventories up to 10 percent or more.  This is done to improve cash flow and limit the volume of unsold product they will have to sell at a discount.  Retailers will also concentrate on any exclusive deals with apparel manufacturers that might give them an edge with consumers.  In a move that appears set to reduce apparel offtake, many chains have indicated more attention will be on non-apparel items such as purses, electrical items, accessories, etc. this holiday season, with less emphasis on sweaters, shirts, jeans, etc.

Concern over the holiday season is making it difficult for apparel exporters to obtain the price increases needed to maintain their profit margins, which is putting pressure on all markets.  Reduced orders from the U.S will affect the higher-cost exporters.  Bangladesh and Vietnam seem to be maintaining order flow due to their concentration in Wal-Mart and other discount chains, while Indonesia and India appear to be fighting to hold order flows.  China's orders are weaker, with many of the Chinese exporters shifting their focus to other markets, especially with the medium and lower-priced products.  Mexico is continuing to have a difficult time despite the freight advantage to the U.S. market.