On 12th February 2026, Phoenix House in Leicester hosted a significant industry meeting that brought together textile manufacturers, policymakers, and national representatives to address the future of UK garment production.
Organised by the Apparel and Textile Manufacturers Federation (ATMF) in collaboration with Fashion-Enter Ltd (FEL), the event welcomed delegates from the Office of the Small Business Commissioner and the Department for Business & Trade (DBT), alongside 15 Leicester-based manufacturers and sector leaders.
Chaired by Jenny Holloway, CEO of FEL and Chair of ATMF, the meeting centred on a critical question: how can policymakers better support SMEs within UK manufacturing?
Leicester’s Unique Manufacturing Strength
Leicester continues to stand out as one of the UK’s only fully vertically integrated textile hubs. Local manufacturers offer a complete production ecosystem, from fabric supply and printing to garment construction, embellishment, and rapid turnaround production within just 5-10 working days.
Many of these businesses are long-established, family-run enterprises with deep-rooted technical expertise. In recent years, particularly following scrutiny during the COVID-19 pandemic, the sector has made major strides in compliance, transparency, and ethical standards.
Despite these improvements, reputational challenges persist. While retailers increasingly express interest in reshoring production, concerns around risk and pricing often result in continued reliance on overseas manufacturing.
Late Payments Continue to Impact SMEs
A key issue raised during discussions was the ongoing challenge of late payments and financial pressure on manufacturers.
Businesses reported extended payment terms of up to 90 days, retrospective discounts imposed after delivery, and, in some cases, threats of losing contracts if such terms were not accepted. These practices effectively position manufacturers as informal financiers for larger brands.
The Small Business Commissioner outlined existing support for SMEs and highlighted ongoing government reviews, including proposals to cap payment terms at 60 days, introduce stricter enforcement for late payers, and implement a 30-day invoice dispute rule.
For Leicester manufacturers, resolving these issues is essential not only for cashflow but also for restoring fairness and stability across supply chains.
Public Procurement Offers Major Opportunity
Public procurement emerged as a key area of opportunity. With over £400 billion spent annually on public contracts, even a small allocation to UK garment manufacturing could deliver substantial growth for the sector.
The discussion referenced the Public Procurement Act 2023, which aims to improve transparency and support local sourcing. Government departments already demonstrate best practice, paying 95% of undisputed invoices within 10 days.
However, barriers remain, including large bundled contracts, complex tender processes, and short submission deadlines, which often limit SME participation.
Industry leaders proposed breaking contracts into smaller, more accessible lots and emphasised the importance of social value criteria, where Leicester’s local employment and generational businesses offer a strong advantage.
A Collaborative Future: Sector-Wide LLP Proposal
One of the most notable outcomes of the meeting was a shared commitment to explore the creation of a sector-wide Limited Liability Partnership (LLP).
This model would allow manufacturers to combine resources, strengthen financial eligibility, and bid collectively for larger contracts, while maintaining independent operations. ATMF would act as a coordinating body to ensure transparency, fair pricing, and consistent standards.
Plans were also discussed for a Leicester “Mark of Excellence” and a UK-first ‘We Trust’ kite mark, designed to certify ethical manufacturing and improve visibility for factories seeking public sector work.
Sustainability and the Push for UK Production
Manufacturers also called on retailers to commit to producing 3-5% of their ranges within the UK. While government cannot mandate private sourcing decisions, increased domestic public procurement could encourage broader industry change.
Upcoming sustainability regulations, including the EU’s Ecodesign for Sustainable Products Regulation (ESPR), are expected to further support UK production by encouraging shorter supply chains, reducing waste, and promoting transparency through initiatives like Digital Product Passports.
Looking Ahead to Leicester Made & Regions 2026
The meeting has set the stage for continued momentum, with attention now turning to the Leicester Made & Regions event taking place on 24th April 2026.
Stakeholders are seeking stronger connections with procurement bodies, including the Ministry of Defence and Crown representatives, to unlock new opportunities for domestic manufacturers.
Industry Leaders Call for Action
Reflecting on the meeting, Jenny Holloway expressed pride in Leicester’s manufacturing community and its potential for growth.
She highlighted the significant opportunity for government to engage more closely with SMEs, particularly in public procurement, to support job creation and strengthen the UK’s manufacturing base.
With growing alignment between industry and policymakers, the message from Leicester is clear: the foundations are in place – now action is needed to ensure the sector can thrive.