In this paper we examine trajectories of change in London's garment industry set within the contexts of deindustrialisation, increasing competitive pressures, and discursive shifts in public policy towards the ‘creative industries’. We emphasise the diversity of firm-level strategies that have been implemented to cope with increasing competitive pressures, liberalisation, and outsourcing in the industry. We identify a dominant trajectory of factory closure, job loss, and deindustrialisation as firms are unable to compete on the basis of the kinds of contracting requirements of buyers and retailers in a high-cost location such as London. We also identify a range of strategies that firms continuing to operate in London have adopted, including the development of new functions in the supply chain, repositioning in relation to specific market niches, coordinating the relocation of production offshore, upgrading towards more design-intensive, small-batch production, and spreading risk across a range of activities. While some of these strategies connect to wider public policy discourses concerning the creative industries in London, they also suggest the need for a broader framing of firm-level trajectories set within the context of the power of major buyers and retailers. Consequently, in the paper we raise concerns over the extent to which creative industries can contribute to enhancing social inclusion and economic development.