In the past weeks, most of the world has come to a standstill. For buyers in fashion retail, the contrast with the hectic and busy buying season could hardly have been more extreme. As they were approaching the end of whirlwind months dominated by fashion fairs, negotiations, and buying decisions around trends and quantities, isolation measures around the world required them to instantly stop in their tracks and metaphorically hit the ‘rewind’ button. Collections that seemed so promising just days before suddenly turned into dark clouds of orders that needed to be halted.
The global health crisis has brought consumer spending to an abrupt standstill, slashing away almost all turnover during the most important fashion retail months of the season. While there is a rise in visits and sales among some fashion e-tailers, these hardly make up the loss from closed boutiques, malls and shopping streets.
Faced with the inevitable loss of income and overstock from this season’s collections and the need to stop production and cancel orders for next season, fashion retailers around the world have been challenged to rethink the practices so ingrained within the industry. Among the stories of financial doom, we are seeing and hearing stories of companies taking novel approaches both to survive in today’s market, and to do business better in the longer term.
Four ways the corona-crisis is encouraging retailers to think more sustainably about their businesses:
1. A call for taking shared responsibility
As buyers are forced to cancel orders, they realise that those who will be most heavily affected by the cancellations are the workers throughout the global supply chains. Many of whom are already working on low wages, will lose their jobs in manufacturing countries such as Bangladesh, Pakistan, and Sri-Lanka.
Buyers are seeing that, in times like these, it is not about hard negotiation, but about sharing responsibility to minimise devastation for all. We have heard about meetings of buyers from different brands seeing how they could collaborate pre-competitively to avoid destroying the livelihoods of thousands of workers throughout supply chain. Some fashion retailers are receiving support from brands agreeing to reschedule new collection deliveries. Others are calling for a joint approach throughout the fashion retail market, to collectively agree on changing the buying and delivery schedules for the upcoming seasons. A joint approach in finding solution, will dampen the losses for all and move away from the ever-quickening rotation in seasonal collections.
2. A push to reduce stock through new approaches
The hidden environmental and financial impact of ever-increasing overstock volumes often made the headlines in the past decade. Today, as new collections lying in stores are likely to turn straight to overstock, these ‘hidden pains’ are put in broad daylight.
There is no more getting around those conversations about how to significantly reduce overstock, both today and in the future. Solutions put forward include putting together smaller collections or seeing how to work more with local suppliers to allow for shorter lead times, more transparency and closer collaboration between retailer and producer. Some brands are looking into manufacturing on demand, similarly to brands such as Elsien Gringhuis, Two Thirds or Tailor Store and Selfnation.
These measures can help retailers minimise exposure to future crises and it would also lessen the environmental impact of mass production and distribution.
3. An opportunity for creative and technological innovation
With fashion retail trends being highly linked to social trends, the sudden forced changes in people’s lifestyles might shift perceptions of what consumers feel they need, want or like to wear, leading to a meaningful shift in the industry.
This is an opportunity for retailers to creatively look at innovative approaches to review what to do with today’s collections that remain unsold. Some pre-coronavirus initiatives that fit into the Circular Economy Model provide inspiration:
- Re-design deadstock products, such as the “H&M Hacked by” collections
- Repurposing deadstock, giving young designers the chance to re-brand and sell Howdareyou, RVDK, Rafael Kouto
- Working with organisations such as the Renewal Workshop that ensures that overstock is repurposed and resold without destroying the original owner’s brand values and appeal
- Explore innovative ways to collaborate with rental platforms to rent out instead of sell fashion collections. There are several collaborative initiatives around the world; for example, Selfridges recently started a collaboration with rental platform HURR
With consumers becoming increasingly sensitive to what they buy and more aware of environmental challenges caused by waste and pollution, retailers might seize this opportunity to look at more sustainable brands and products. Those telling a different story and offering innovative approaches to design, production, and wearability will thrive now both businesses and consumers are looking for acts of kindness.
4. A realisation that business can be a force for good
What we have also seen in the past weeks, is that companies are realising that they are not just money-making machines. They are seeing that they have valuable resources – machines, people, know-how – that can serve a greater good. We have seen big companies such as LVMH set out to produce hand-sanitizers, Zara getting ready to produce face masks and protective clothing, H&M donate funds. But also smaller companies such as Sophia Webster providing free sneakers to nurses , Christian Siriano leveraging his resources to make face masks, or Zadig&Voltaire donating part of their revenues to local hospitals and organisations. Different designers, such as Margheritta Missoni and Anna dello Russo, are selling pieces from their wardrobe through Vestiare Collective with 100% of the profits going to fundraising towards hospitals or supporting organisations. The Oberalp group also started producing and procuring thousands of protective masks and medical gowns, delivering them to Italy for use.
Others are providing their customers opportunities to co-support causes. Besides donating $ 500’000 worth of shoes to healthcare workers, Allbirds provides their clients with the option to add to this contribution through a ‘buy a pair / give a pair’ scheme. Small brand, For days, has committed to sewing 10 masks for healthcare workers for each online purchase made by a customer. And luxury fashion platform FarFetch is encouraging consumers to help support small companies to survive financially, while providing the brands and boutiques on their platform with marketing, logistics and financial support to better serve those consumers.
The world today seems at a standstill. It is not an easy time on many fronts. But it is pushing us to re-think our engrained ways. And it is giving companies the opportunity to reassess their purpose towards all their stakeholders – customers, employees, suppliers, communities and shareholders – to be able to restart on a more sustainable foot in a few months.
In the coming weeks, Good Brand Guru will be holding online roundtables on different topics for professionals in the industry. Rather than presenting answers, the objective is to share thoughts, worries, ideas and collaboratively discuss how to navigate the new world we have the opportunity to embark on. If you are a professional in fashion retail and are interested in joining the conversation, visit our event page for an overview of our upcoming events and register online.