Tariffs Don't Build a Supply Chain

Organic cotton, Fair Trade, and why 'just manufacture here' is more complicated than it sounds.

by Tierra Forte, Mightly Inc CEO

I’ve spent a lot of time over the past year doing math. Many times I felt like I was back in middle school wrestling with a difficult word problem - “If a small business imports organic cotton from India at a 50% tariff, and the cost of domestic manufacturing is twice as high, how many times does the founder cry before Q4?”

Like most small brands that manufacture overseas, Mightly got caught in the middle of an unpredictable and punishing tariff environment in 2025. I wrote about that experience here. When the news broke that tariffs on India, where we source the vast majority of our products, would equal about 70% we asked ourselves the question that I know a lot of people outside the industry ask: Why don’t you just make things here?

It’s a fair question, one that deserves to be answered, because there’s a version of this conversation happening right now that skips over a lot of complicated reality.

The short answer is: we ran the numbers, and even at the highest tariff rates we saw last year, domestic manufacturing still didn’t add up for our business.

There Is No Domestic Organic Cotton Supply Chain

This is the part that surprises a lot of people. Mightly makes organic cotton kids’ clothing. So the obvious suggestion is: use American cotton! And yes, the US does grow cotton (it’s actually one of the largest cotton exporters in the world), but not organic cotton.

Organic cotton farming requires a multi-year transition off conventional pesticides, costly certification processes, and significantly more labor-intensive practices. The US has never had a large-scale certified organic cotton infrastructure, which requires many processes, not just organic fiber. Global organic cotton supply is concentrated in India, which accounts for about half of the world’s certified organic cotton production, followed by Turkey and China. The US trails far behind with approximately 1% of the world’s organic cotton grown domestically.

What that means practically: even if we wanted to manufacture in the United States, we would still have to import raw organic cotton fiber. Then that fiber would need to be spun into yarn somewhere, and woven or knit into fabric somewhere else. We would be paying tariffs on imported raw materials, then adding the cost of US manufacturing on top. The idea that moving production to the US eliminates tariff exposure is simply not true for a brand like ours.

American Apparel Manufacturing Was Hollowed Out Decades Ago

Even for brands working with conventional cotton, domestic manufacturing is challenging. According to the Bureau of Labor Statistics, apparel and textile industries lost 81% of their jobs between 1979 and 2019. More recently, data from AllAmerican.org puts the figure in stark terms: US apparel manufacturing employment has fallen from over 900,000 workers in 1990 to roughly 70,000 today, a 92% decline. The number of US apparel manufacturers dropped from over 15,000 in 2001 to around 7,000 in recent years, and only about 2.5% of apparel purchased in the US is made here.

The infrastructure that would be needed to produce high-quality children’s clothing at an accessible price point simply does not exist domestically. This is an industrial reality that decades of trade policy built, and one that tariffs alone cannot undo overnight.

The Brands That Do It Charge Accordingly

There is a domestic manufacturing success story worth mentioning, and it’s a genuine one. American Giant has spent more than a decade proving that US-made apparel is possible. Their hoodie was famously called the greatest ever made. They’ve been relentless about it, and I have deep respect for what they’ve built.

Their classic hoodie retails for $138. Their cotton t-shirts run between $40 and $60. Even their partnership with Walmart to produce a made-in-America t-shirt at a breakthrough price point of $12.98 required Walmart’s enormous scale and financial commitments to make the supply chain viable, and one they’ve distinguished from their core line as lower quality.

That context matters a lot for what we do. Mightly’s entire value proposition is making certified organic, non-toxic, hand-me-down-quality kids’ clothing accessible to families who care about what touches their children’s skin but can’t always afford the prices the premium market charges. That accessibility is not an afterthought. It is the mission. If we doubled our prices, we we would be failing our customers.

We Ran the Numbers. They Don’t Work.

We priced out what domestic manufacturing would cost us. After accounting for the tariffs we were paying at peak rates, US manufacturing would still require us to roughly double our prices to customers. The savings on import duties would not come close to offsetting the cost of domestic labor, domestic overhead, and the logistical reality of flying organic raw materials from India to the US to be processed before being made into garments.

On top of that, our finished goods would no longer qualify for Fair Trade certification. Fair Trade USA’s factory certification program is built around verifying fair wages, safe conditions, and community investment premiums for workers in the countries where the garments are actually made. Moving production to the US doesn’t just change geography. It dissolves the economic development impact that Fair Trade certification is designed to create for garment workers in lower-income countries, who depend on those wages and community funds. (If you want to understand more about what that certification means and who it serves, I went into more detail on that here.)

And then there’s the human dimension that doesn’t show up in a cost model. Our production partners in India are not abstract entries in a spreadsheet. We have relationships with them that we have built carefully over years. They have invested in meeting our standards and become true partners in our success. Walking away from those partners to chase a supply chain that doesn’t exist domestically would be a real harm to real people.

What We’re Doing Instead

We’re not pretending the tariff environment is fine. It isn’t. As I wrote earlier this year, the unpredictability alone is its own kind of damage, and small brands absorb it differently than large ones. But the answer for us isn’t domestic manufacturing. It’s continuing to build the most transparent, ethical, accessible supply chain we can, in the place where the raw materials and processes we need exist together. That means staying invested in our Indian production partners, maintaining our Fair Trade and GOTS certifications, and being honest with our customers about why our clothes cost what they cost.

While we can’t make the made-in-America story work, we are continually getting better at what we do: making organic kids’ clothes that don’t ask families to choose between safe and affordable.

Mightly makes certified organic, Fair Trade kids’ clothing. You can learn more at mightly.com