Beyond the Breakout: The Fashion Industry Post-CoronavirusApril 3, 2020
The coronavirus is the hot topic globally and the fashion industry is feeling the heat. From shifts in sourcing to significant impacts on supply chains, rethinking processesseems to be the “new normal.” Numerous postponements of fall 2020 collections and shows, manufacturing facilities closed, and projected revenue losses for the first half of 2020 all have forced companies like The Capri Group, which owns Versace and Jimmy Choo, to expect to lose up to $100 million in revenue. Some groups are doing what they can to help, such as the Council of Fashion Designers of America. Tom Ford, CFDA chairman, said in a recent WWD article that the CFDA “is working to access [monetary] relief at the federal and local levels.”
It’s Not All Doom and Gloom
But with challenge also comes strength, and Italian think-tank Prometeia has reported that they “expect a rebound” and that Italian Fashion revenue is expected to rise to $87 billion in 2021.
In the U.S., the light at the end of the tunnel seems to be fast-approaching as well. For example, Kohl’s recently cemented a new partnership with Lands’ End. The retailer expects to feature the “entire assortment” of the brand online and in 150 stores by fall, signaling confidence that long-term revenues will rebound and improve.
A New Way of Thinking
Brands are reinventing themselves yet again by starting to engage with their communities more than ever. According to Vogue, Forest Cabin, a Shanghai-based brand, had to close 337 stores. After the company lost 90% of its sales, they began to engage their community through livestreaming services, which brought they sales up 45% for the year.
Our president Mark Burstein said in a recent Sourcing Journal article, “The digital supply chain has been one of the leading topics among fashion supply chain executives for several years now, and it’s red-hot today in the wake of the coronavirus health emergency. The only certainty of a global crisis such as the coronavirus is that it will happen again, in ways that companies don’t expect. With a digital supply chain platform, retailers can be prepared.”
The COVID-19 outbreak has exposed the world’s vulnerability and lack of preparation for a crisis of this magnitude with fashion being shaken to its core. Now that the industry is aware of its shortcomings, companies and consumers alike will surely be able to sleep easy knowing that next time, we’ll all be ready.
How NGC Can Help
NGC’s Andromeda Cloud Platform enables the digital supply chain and helps companies prepare for whatever is next. Learn how Andromeda can mitigate a crisis by contacting us.