Southeast Asia inspection demand rose 24% in 2025: Vietnam, Thailand lead

Quality control and compliance inspection volumes across Southeast Asia climbed 24% in 2025, according to data released by QIMA, the Hong Kong-based testing and audit firm that serves more than 30,000 brands and retailers. Vietnam led the surge with a 30% year-on-year increase in inspection orders, whilst Thailand recorded a 44% jump, the highest growth rate in the region. The figures signal an acceleration of the China-plus-one sourcing strategy that has reshaped global apparel and footwear supply chains over the past three years.

The growth comes as fashion companies face mounting pressure to diversify production beyond China, where labour costs have risen and geopolitical tensions continue to drive tariff uncertainty. Indonesia posted 22% inspection growth, Cambodia 18%, and the Philippines 16%, QIMA reported in its annual supply chain update published in January 2026. Meanwhile, inspection demand in China fell 8% year-on-year, the steepest decline since the trade war escalation of 2019.

For fashion executives planning 2027 sourcing roadmaps, the data underscores both the velocity of the shift and the operational complexity it creates. More suppliers in more countries means more audits, longer lead times, and a higher risk of quality failures if inspection regimes do not scale in tandem with order volumes.

What is driving inspection growth in Southeast Asia?

Three overlapping forces explain the 24% rise in Southeast Asian inspection activity. First, tariff policy remains volatile. The United States maintained 25% duties on Chinese apparel imports throughout 2025, prompting American retailers to shift purchase orders to Vietnam, Thailand and other ASEAN economies that benefit from lower tariff rates or preferential trade agreements. European buyers, facing their own scrutiny of Chinese supply chain transparency under the Corporate Sustainability Due Diligence Directive, have likewise accelerated diversification.

Second, production capacity in Southeast Asia has expanded rapidly. Vietnam added an estimated 180,000 garment workers in 2024 and 2025 combined, according to the Vietnam Textile and Apparel Association, whilst Thailand invested heavily in textile mills and cut-and-sew facilities in its eastern economic corridor. New factories require new audit relationships, onboarding inspections, and regular compliance monitoring, all of which flow into QIMA's order books.

Third, buyers are demanding more frequent inspections. A 2025 survey by the U.S. Fashion Industry Association found that 68% of respondents increased the frequency of third-party inspections compared with 2023, citing quality issues at unfamiliar suppliers and regulatory pressure to document working conditions. The combination of more factories and more inspections per factory compounds the growth rate.

Why did Vietnam and Thailand see the steepest increases?

Vietnam's 30% inspection growth builds on a decade of investment in vertically integrated textile clusters. The country already accounts for roughly 15% of global apparel exports by value, and its free trade agreements with the European Union and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership give it tariff advantages over China. QIMA noted that inspection orders for sportswear and outerwear in Vietnam rose 35% in 2025, driven by brands seeking alternatives to Chinese manufacturers of performance fabrics and technical garments.

Thailand's 44% jump is more recent and reflects a different mix. The country has become a hub for intimate apparel, swimwear and activewear, categories where quality control is particularly stringent because of fit tolerances and fabric performance requirements. Thailand also benefits from a more developed logistics infrastructure than neighbouring Cambodia or Laos, making it easier for buyers to schedule inspections and resolve defects quickly. QIMA's data showed that pre-shipment inspection orders in Thailand doubled year-on-year in the second half of 2025, suggesting that production ramp-ups reached commercial scale in that period.

Both countries have also invested in compliance infrastructure. Vietnam's Ministry of Labour, Invalids and Social Affairs expanded its factory inspection programme in 2024, whilst Thailand's Department of Labour Protection and Welfare introduced digital audit reporting requirements in early 2025. These initiatives raised the baseline for social compliance, but brands still commission third-party audits to verify claims and satisfy their own corporate governance standards.

Which fashion companies are shifting production to Southeast Asia?

Publicly disclosed sourcing shifts remain limited, but trade filings and company statements offer visibility into the broader trend. In October 2025, Gap Inc. told investors that it had reduced its China sourcing from 23% of units in 2023 to 16% in 2025, with Vietnam, India and Bangladesh absorbing most of the reallocation. The company's chief supply chain officer said the firm had onboarded 47 new suppliers in Southeast Asia over the preceding 18 months, each requiring initial capability audits and ongoing quality inspections.

Swedish retailer H&M reported in its March 2025 sustainability disclosure that Vietnam accounted for 18% of its total garment procurement, up from 15% in 2023, whilst China's share fell from 22% to 18% over the same period. The retailer noted that it conducted 2,400 audits across Vietnam in 2024, a 28% increase over 2023, in line with QIMA's regional figures.

VF Corporation, parent of Vans, The North Face and Timberland, disclosed in its fiscal 2025 annual report filed in May 2025 that it had increased production in Southeast Asia by 19% year-on-year, with particular growth in Vietnam and Indonesia for footwear and technical outerwear. The company stated that it required all new suppliers to pass an initial environmental, social and governance audit before receiving purchase orders, contributing to higher inspection volumes.

How does inspection demand in China compare?

QIMA's report showed that inspection orders in China fell 8% in 2025, the first significant decline since the pandemic year of 2020. The drop reflects not a collapse in Chinese manufacturing but a relative shift in global sourcing mix. China remains the world's largest apparel exporter in absolute terms, shipping USD 178 billion of clothing in 2024 according to Chinese customs data, but its share of total global exports has slipped from 32% in 2020 to an estimated 28% in 2025 as brands diversify.

Some categories still see rising inspection activity in China. QIMA noted that orders for luxury handbags, leather goods and technical outerwear in China edged up 3% in 2025, as brands prioritise quality and intellectual property protection over cost savings. However, mass-market apparel, footwear and accessories saw double-digit inspection declines, with orders migrating to Southeast Asia and South Asia.

The 8% fall in Chinese inspections contrasts sharply with the 24% Southeast Asia increase, underscoring the speed of the pivot. For comparison, India recorded 12% inspection growth and Bangladesh 9% in 2025, according to QIMA, suggesting that Southeast Asia is capturing a disproportionate share of the diverted volume.

What are the quality and compliance risks of rapid expansion?

Faster growth in inspection volumes does not automatically translate into better supply chain governance. Industry observers caution that the rush to onboard new suppliers in Southeast Asia has introduced quality and compliance blind spots. A 2025 study by the Clean Clothes Campaign found that 41% of newly audited factories in Vietnam, Cambodia and Indonesia had at least one major non-conformance related to working hours or health and safety in their first inspection, compared with 28% of established suppliers audited for the second or third time.

Lead times for inspections have also lengthened. QIMA's data showed that the average wait time for a pre-shipment inspection in Vietnam rose from 2.8 days in 2023 to 4.1 days in late 2025, as auditor availability lagged the surge in demand. Longer wait times increase the risk that defects go undetected or that shipments leave the factory before inspection results are available.

Labour standards remain a concern. Thailand's fishing and seafood industries have faced persistent allegations of forced labour, and whilst the garment sector operates under different dynamics, advocacy groups warn that rapid factory expansion can outpace labour inspectorate capacity. Cambodia's minimum wage for garment workers rose to USD 204 per month in 2025, but enforcement of overtime and leave provisions is inconsistent, according to the International Labour Organization's Better Factories Cambodia programme.

There is also a risk of audit fatigue. Suppliers juggling orders from multiple brands may face a dozen or more inspections per year, each with slightly different protocols and corrective action timelines. A 2024 report by the Sustainable Apparel Coalition found that duplicative audits cost the industry an estimated USD 500 million annually and recommended greater harmonisation of audit standards.

What role do digital tools play in inspection efficiency?

Digital inspection platforms have become more common as volumes rise. QIMA reported that 62% of its 2025 inspections in Southeast Asia used mobile apps to capture photos, defect counts and corrective action notes in real time, up from 48% in 2023. The shift reduces paperwork, shortens turnaround times and creates structured data that brands can analyse to identify recurring quality issues across suppliers.

Some brands are piloting remote video inspections, in which a factory worker or local agent livestreams a product walkthrough to an auditor located elsewhere. The approach can cut costs and scheduling delays, but it is less effective for tactile checks such as seam strength, fabric hand feel or colour matching. QIMA's data indicated that remote inspections accounted for 11% of total orders in Southeast Asia in 2025, concentrated in categories like accessories and packaging rather than garments.

Artificial intelligence is beginning to assist with defect detection. QIMA piloted an image recognition system in 2025 that flags stitching flaws, colour deviations and measurement discrepancies in uploaded photos, reducing the manual review burden on human auditors. The company reported a 15% reduction in inspection report turnaround time in pilot factories, though the technology is not yet deployed at scale.

How are inspection costs and audit pricing evolving?

Inspection costs in Southeast Asia have risen alongside demand. QIMA did not disclose detailed pricing, but industry benchmarks suggest that the average cost of a pre-shipment garment inspection in Vietnam ranged from USD 280 to USD 350 per man-day in 2025, up roughly 12% from 2023. Thailand's inspection costs are marginally higher, reflecting tighter labour markets for qualified auditors.

Brands typically budget inspection costs at 0.3% to 0.8% of the value of goods inspected, depending on product complexity and frequency. As sourcing diversifies across more countries and smaller order quantities per factory, the per-unit inspection cost tends to rise because fixed setup costs are spread over fewer units. A 2025 report by McKinsey estimated that fragmented sourcing could add 50 to 100 basis points to total supply chain costs if inspection and logistics inefficiencies are not managed.

Some buyers are negotiating volume discounts or annual retainer agreements with inspection firms to control costs. Others are pooling audits with industry peers through initiatives like the Social and Labor Convergence Program, which allows multiple brands to accept a single audit report for shared suppliers. QIMA noted that consortium audits represented 9% of its 2025 orders in Southeast Asia, up from 6% in 2024.

What questions remain unanswered?

Several open questions will shape the trajectory of Southeast Asian sourcing over the next two years. First, it is unclear whether inspection growth rates will moderate as the initial wave of supplier onboarding concludes. QIMA's 24% regional increase in 2025 may represent a one-time surge tied to tariff policy shifts, or it may signal the start of a multi-year reallocation that sustains double-digit growth through 2027.

Second, the quality of audits themselves is under scrutiny. A 2024 investigation by the Worker Rights Consortium found that some third-party audits in Cambodia and Vietnam failed to detect underpayment of wages or excessive overtime, raising questions about auditor independence and training. Industry groups are debating whether to introduce accreditation standards for inspection firms or require unannounced audits to reduce the risk of coached responses.

Third, the environmental dimension of Southeast Asian sourcing remains underexplored. Vietnam and Thailand have less stringent wastewater discharge limits than China or the European Union, and factory compliance with local environmental regulations is inconsistent. QIMA reported that only 19% of its 2025 audits in Southeast Asia included environmental modules, compared with 34% in China, suggesting that buyers may be prioritising speed and cost over sustainability during the initial relocation phase.

Finally, geopolitical risk has not disappeared. U.S. trade policy could shift again after the 2028 elections, and any reduction in China tariffs might slow or reverse the Southeast Asian pivot. Brands that have invested heavily in new supplier relationships and quality infrastructure in Vietnam or Thailand will need contingency plans if the economic rationale for diversification weakens.

What should fashion companies do now?

1. Audit supplier capacity before scaling orders. Conduct capability assessments at new Southeast Asian factories to verify production volume, lead time commitments and quality management systems before placing large purchase orders. QIMA's data shows that 41% of first-time audits reveal major non-conformances, so early visibility is essential.
2. Increase inspection frequency during ramp-up periods. Plan for weekly or bi-weekly inspections during the first three to six months of production at a new supplier, then shift to monthly or per-shipment checks once quality stabilises. This front-loads costs but reduces the risk of expensive recalls or chargebacks.
3. Harmonise audit protocols across markets. Align social compliance and quality standards for Vietnam, Thailand, Indonesia and other Southeast Asian countries with existing China and Bangladesh requirements, and share audit results through industry platforms to avoid duplicative inspections.
4. Invest in auditor training and local partnerships. Work with inspection firms to recruit and train local auditors in Southeast Asia, ensuring they understand both international standards and regional labour laws. Thailand and Vietnam have growing pools of qualified inspectors, but Cambodia and the Philippines face talent shortages.
5. Integrate inspection data into sourcing scorecards. Use digital inspection platforms to track defect rates, turnaround times and corrective action close-out rates by supplier and country, and incorporate these metrics into quarterly business reviews with vendors. Data-driven scorecards help identify high-performing suppliers and flag quality risks early.
6. Budget for higher per-unit inspection costs. Recognise that fragmented sourcing across more countries will raise inspection costs as a percentage of total landed cost, and build these assumptions into 2027 costing models. McKinsey estimates that diversification can add 50 to 100 basis points to supply chain costs if not actively managed.
7. Monitor lead time and capacity constraints. Track average wait times for inspections in key markets, and work with inspection firms to secure guaranteed turnaround times or dedicated auditor capacity during peak shipping seasons. Vietnam inspection lead times rose from 2.8 days in 2023 to 4.1 days in late 2025, creating bottlenecks that delay shipments.