UK firms face supply chain compliance woes, report says

Oritain has released its 2026 Global Supply Chain Intelligence Report, which found that 80% of UK companies faced regulatory or compliance challenges in 2025.

The findings point to a widening gap between supply chain documentation and verified proof of origin, using cotton as the main test case. Nearly 94% of UK companies surveyed now trace their cotton supply chains, yet Oritain's market data showed that 90% of brands analysed in 2025 recorded at least one result consistent with risk, up from 64% a year earlier.

The report draws on a multi-year forensic sampling programme that analyses about 1,000 garments across 40 brands each year, alongside consumer research and industry and supplier intelligence from manufacturing hubs. It argues that increased supply chain tracing has not translated into stronger assurance over the origin of raw materials.

For UK businesses, the commercial impact appears significant. Among those surveyed, 44% reported direct reputational damage or public relations crises linked to supply chain issues, while 65% said gaps in upstream verification prevented them from meeting their own sustainability goals.

The study places cotton at the centre of the current compliance debate because of its scale in global trade and its exposure to overlapping regulatory and trade controls. According to the report, exposure to cotton prohibited by legislation has risen back to levels last seen before 2021, after three years of improvement.

Compliance pressure

Economic pressure, tighter enforcement and shifting sourcing patterns are reshaping supply chains faster than many internal control systems can adapt, according to the report. As a result, companies are relying too heavily on declarations and paperwork at a time when regulators, consumers and investors are demanding stronger evidence.

The problem is no longer confined to isolated failures or a small number of brands, Oritain said. Its data suggests exposure to prohibited cotton has become a broader, system-wide issue, affecting nine in 10 brands analysed.

Consumer attitudes in the report also point to a tougher operating environment for brands making sourcing claims. It found that 60% of consumers avoid products linked to origins they do not trust, while only 3% trust marketing claims. Consumers place the highest trust in government regulation and scientific traceability to origin.

The report also found support for tougher standards beyond cotton. In leather, 69% of consumers backed mandatory proof of ethical sourcing.

Alyn Franklin, chief executive officer of Oritain, said the current pattern showed risk shifting rather than disappearing.

"The data tells a clear story: risk isn't disappearing, it is re-emerging," Franklin said.

He said changes in manufacturing locations were not removing the underlying exposure in supply chains.

"As brands pivot manufacturing regions they're finding that upstream material exposure hasn't gone away - it is increasingly appearing in other key manufacturing hubs. Without independent verification, that risk travels quietly through complex trade routes and only surfaces at the end of the supply chain, when goods are stopped, costs escalate and production timelines are already missed," Franklin said.

Verification gap

The report frames this as a shift from procedural compliance to evidence-based verification. Traceability shows process and intent, it said, but does not by itself provide proof that can withstand rising enforcement.

That distinction is becoming more important as companies face border delays, financial penalties, disrupted production cycles and lost commercial relationships. Oritain said 80% of UK brands surveyed and 37% of US brands surveyed had already experienced some form of material impact from supply chain failures.

It argues that businesses need continuous, independent checks of origin claims rather than periodic reviews. A repeatable forensic model, the report said, would allow problems to be identified earlier and claims to be substantiated before goods reach borders or store shelves.

Franklin said growing pressure from regulators and the wider economy was changing what companies needed from supply chain systems.

"As regulatory and economic pressures intensify, visibility without verification no longer holds," he said. "What matters now is evidence that stands up. Oritain's role is to provide the science, intelligence and networked approach that allows organisations to move from reactive compliance to proactive supply chain management - building trust that is measurable, defensible and scalable over time."