Coronavirus: Why the fashion industry faces an ‘existential crisis’

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Clothes intended for sale this spring and summer were shown at the Fashion Weeks last September

Normally, at this time of year, many of us would be curating our perfect summer wardrobe as we prepare for sunny weather and foreign holidays.

Instead, clothing sales plummeted by 34% in March as much of the world’s population is currently unable to travel abroad or even socialise amid lockdown restrictions.

“No-one wants to buy clothes to sit at home in,” as Next’s chief executive Simon Wolfson put it last month.

The fashion industry has been negatively impacted by the coronavirus outbreak on every imaginable level; production has ceased, retailers have closed, demand has plummeted.

“It has led to a real existential crisis for the fashion industry,” says Imran Amed, the founder and CEO of The Business of Fashion, a leading industry website which has produced a report about the impact of the coronavirus outbreak.

“This is an industry which is still almost entirely dependent oh physical retail. More than 80% of transactions in the fashion industry still happen in physical stores.

“Added to that, many consumers simply aren’t interested in buying clothes right now. There’s so much focus on purchasing essential items to survive during the lockdown and I think everyone’s minds have naturally been focused on that. So fashion just becomes an after-thought, or no thought at all in that kind of context.”

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Uniqlo, which has closed its high street stores, has discounted items like jogging bottoms and leggings on its website

With sales so low, there are questions about what will happen to the existing stock of clothes building up in stores and warehouses.

“Unlike food or some medicines, [fashion] products do not go off. But many go out of style,” noted The Economist. “Sometimes, as with seasonal apparel collections, rather quickly.”

In an effort to maintain some income, many high street retailers are selling anything they’re able to at significantly discounted prices online.

Gap and H&M, for example, have been offering mid-season sales, while Uniqlo is promoting discounted comfort-wear items people are likely to need at home, such as jogging bottoms and leggings. (Browns in London has reported a 70% increase in sales of loungewear.)

It’s likely more brands and retailers will offer discounts as time goes on, Amed notes, which will damage profit margins, but he is hopeful that the fashion calendar being out of sync won’t be as big an issue as many fear.

“We always have to remember there are two hemispheres in the world, so when it’s summer in one place it’s winter in another,” he says. “And I think there are creative ways we could think of to redistribute those collections.

“But as for clothing going out of style, there are just so many different kinds of trends and aesthetics now that I think the idea of things being in or out of style is less marked now than it was maybe 10 or 15 years ago.

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Business of Fashion CEO Imran Amed says the fashion industry is facing an “existential crisis”

“I’ve actually heard of some designers who are saying, ‘the collection I showed for spring/summer 2020, we’re just going to sell that in spring/summer 2021’. That won’t be a solution that works for every brand, but I think getting through this

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