6. 2026 Supply chain in fashion outlook
Resilience, regulation, and robotics: Fashion supply chain pivots for 2026
The fashion supply chain in 2026 is no longer defined solely by speed and cost, but by its resilience, precision, and adherence to escalating regulatory standards. The prevailing operational reality is one of volatility, driven by geopolitical turbulence, trade tariffs, and climate-related shocks. Executives cite responses to trade disruptions and rising tariffs as the single most significant theme shaping the industry in the year ahead. This environment demands a fundamental shift in strategy, turning the supply chain from a reactive cost centre into a proactive, technology-driven competitive advantage.
Digital backbone delivers operational precision
The cornerstone of a future-proof fashion supply chain is a connected digital backbone. Fragmented data blocks true visibility, hindering effective ESG reporting and swift decision-making. By linking enterprise resource planning, product lifecycle management, sourcing, production, and logistics into a unified view, brands can unlock the full potential of artificial intelligence. According to McKinsey’s ‘State of Fashion’ report, more than 35 percent of fashion and luxury executives are already deploying AI in key operational areas, a clear signal that planning is shifting from hindsight to foresight. AI-driven planning allows brands to:
This technological integration is visible across the value chain, from design to final delivery. In logistics, the German provider DHL Supply Chain is accelerating its AI strategy through a partnership with the AI startup HappyRobot. This collaboration rolls out agentic AI to automate high-volume communications, handling hundreds of thousands of emails and millions of voice minutes annually for critical workflows like appointment scheduling and driver follow-up calls. Sally Miller, chief information officer for DHL Supply Chain, explained that integrating AI agents drives "greater process efficiency for customers while making operational roles more engaging and rewarding for employees by automating repetitive and time-consuming tasks".
Similarly, the Netherlands-based outlet platform Otrium is using AI both in its warehouse logistics and for generative content creation. Co-founder Milan Daniels noted that the implementation of robotics and AI in their warehouse reduced the workforce by seventy percent and delivered enormous efficiency gains, bringing the company closer to profitability. Otrium also leverages generative AI to cost-effectively create model photos for the five million items of residual stock it receives annually, improving product presentation and conversion rates where professional photography was previously unprofitable.
Sourcing optionality and nearshoring
The concentration of sourcing networks in too few regions is a major vulnerability, especially as trade rules and tariffs shift. According to Paul Magel of CGS, nearshoring and multi-sourcing have moved beyond being a trend to become core resilience strategies.
Effective sourcing in 2026 relies on geographically balanced networks and tight collaboration between planning and sourcing, powered by a unified digital backbone. This optionality allows brands to avoid the rushed, expensive pivots that erode margins.
This shift is actively demonstrated by Spanish fashion multinational Tendam. The company operates a network supported by its new, highly automated logistics centre in Illescas, Spain, as well as one in Mexico, and its physical stores, which act as “mini-hubs”. The Illescas centre, equipped with automation solutions from Dematic, handles 85 percent of all online orders, with a capacity to scale its operations by 30 percent to 50 percent above current capabilities. Manel Jiménez, chief operating officer of Tendam, stated that the integration of digital stock from stores and the Illescas warehouse allows an internal "Order Management System" to decide in real-time the most optimal way to process each online order. As an example, a Women’secret order for collection at a store will be prepared directly at the store, if stock is available, instead of at the Illescas centre.
The trend toward a more local and manageable economy is also supported by Dr. Natascha van der Velden, a Dutch expert on sustainable textiles and life cycle assessments. Dr. van der Velden believes strongly in a more local economy, stating, "The shorter and more manageable the supply chain, the more control you have," which can even lead to cost savings. She also advises companies to "Do less, but better," and to produce smarter, pointing to on-demand production systems that closely align material inventories, demand, and production.
Compliance transforms into competitive advantage
Compliance, particularly around environmental, social, and governance (ESG) metrics, has shifted from a reporting task to a structural advantage. New mandates, including the European Union’s Digital Product Passport (DPP) and the Corporate Sustainability Reporting Directive (CSRD), require product-level traceability, moving beyond simple supplier documentation. This transparency eliminates blind spots, strengthens supplier accountability, and is resilience in action.
Spanish multinational Mango, for example, is scaling its collaboration with the Netherlands-based TextileGenesis, a specialist in traceability solutions. The Spanish company began testing solutions in 2023 and has already tracked over six thousand tonnes of sustainable fibres and more than 40 million finished product units. By formalising the partnership, Mango is implementing a comprehensive set of digital tools, including the ‘Fiber-to-Retail’ module for tracing sustainable fibres and the ‘Supply Chain Discovery’ module for reverse traceability from the final product back to the material origin.
Amit Guatam, founder and chief executive officer of TextileGenesis, stated that achieving transparency is a "significant challenge for brands like Mango, given the complexity of their global supply chains". However, this kind of verifiable transparency is necessary to meet rising consumer expectations—where 66 percent of customers actively consider sustainability in purchasing decisions—and to reduce regulatory risk.
A focus on ethical conduct in the supply chain is also critical. Amnesty International has called on global textile companies to protect workers’ rights in their supply chains in India, Bangladesh, Pakistan, and Sri Lanka, detailing "widespread violations affecting freedom of association in the garment industry". This pressure, coupled with the weakening of the European Union's directive on corporate social and environmental due diligence, underscores the need for brands to adopt an active sourcing strategy that rewards suppliers respecting freedom of association.
Looking ahead, the Japanese apparel giant Fast Retailing Co., Ltd. has raised its target to reduce greenhouse gas emissions in its supply chain from 20 percent to 30 percent by the end of its financial year 2030. Koji Yanai, Fast Retailing Group senior executive officer, noted that this increase was possible because the company is "ahead of schedule" in progress, due to close collaboration with production partners. This includes initiatives such as sourcing wool from designated Australian farms with trial audit programs for animal welfare and environmental standards. In a complex year defined by volatility, the fashion supply chain’s winners in 2026 will be those that invest in visibility, AI-driven planning, and structural ESG integration to maintain agility and accelerate with confidence.
This 2026 Outlook is based on more that 35 articles, interviews and reports published on FashionUnited. It was written with the help of AI
FashionUnited uses AI tools to read and research large amounts of data. Articles created with the help of AI are checked and edited by a human desk editor prior to going online. If you have questions or comments about this process email us at info@fashionunited.com
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