9 April 2020
From huge financial losses to store closures - this is COVID-19 and the fashion industry
COVID-19 has substantially affected how businesses operate. The fashion industry has had to close stores and halt manufacturing.
As of 9 April, The World Health Organisation (WHO) confirmed nearly 1.5 million cases of COVID-19 globally. The International Monetary Fund estimates global economic growth could be slashed by 3%.
Closing stores, revenue losses and live-streaming fashion catwalks...
Retailer, Michael Kors announced losses due to Coronavirus, on February 5. Owners, Capri Holdings Ltd, stated the business lost $100 million dollars in revenue, after closing 150 stores across mainland China.
February 23, Giorgio Armani cancelled his Milan Fashion Week catwalk amid rising Coronavirus concerns in Italy. The show was live streamed behind closed doors. The fashion designer later donated £1.1 million to Italian hospitals.
Among others, Topshop, John Lewis and Primark, temporarily closed their UK stores, however some continue trading online.
Online retailers, PrettyLittleThing, have continued to operate; promoting daily sales to encourage sales. They have extra measures in place for their employees: allowing time off to look after their families, self-isolate and stay sanitised whilst at work.
'Mentally it affected me quite badly...suddenly being in limbo after all my hard work, it did hit me quite hard'
Alexander Clementine make sustainable underwear from seaweed. Production was scheduled for 23 March, just as the UK went into lockdown. Co-Founder, Freya Rosedale, spoke about COVID-19's impact on her business.
'We had paid the majority of...production costs upfront, unfortunately the factory shut down. I quit my job to work full time on the business...after all my hard work it did hit me quite hard. We've had to move our business plans back...the uncertainty of not really knowing when this is going to end...is quite worrying'.
'Luckily...they [manufacturer] managed to find an amazing machinist to create our pieces from her home. We will have to wait for the factory to re-open for the garments to be completely finished. It does also give us an opportune moment to hone our e-commerce and marketing skills. My co-founder...has been furloughed - having him...concentrate on the brand 24/7, has been great'.
How is the fashion industry's economy affected?
High street stores, Debenhams, Oasis and Warehouse, announced they would be going into administration.
GlobalData say Coronavirus will wipe out 1/5 of UK fashion spend in 2020. Kate Ormrod, Lead Retail Analyst, comments: “Amid a UK lockdown...buying new clothes and footwear is far from a top priority for consumers'
Director of retail at Keytree, Steve Ingram said, 'Retailers have cancelled orders and refused to pay agreed contracts, causing...concern at garment factories in poorer countries'.
Comments