Covid – 19 and impacts on the lingerie trade in 2020
With 2020 trends and new colour palette options dropping into my inbox daily, it’s hard to believe this season’s fashions could potentially just pass us by. This unprecedented global situation and global pandemic feels surreal and makes fashion feel very inconsequential with the other problems we’re all faced with.
China has just started to lift restrictions
China is only now starting to lift restrictions after the virus first emerged in Wuhan in December 2019. But the rest of the world is in lock-down, businesses in every country around the world closed until further notice and the death toll continues to rise day after day, as a result of the continued spread of a deadly Covid-19 Virus.
How will a three-month lock-down affect lingerie brands and retailers? Is it time to make changes?
What will be the impacts of a 3-month lock-down? Will the world just return to “business as usual” or will things change? Or should we take this opportunity to make some changes? It’s been said for a while now that manufacturing lingerie in china is no longer significantly cheaper than Europe, especially when we consider the lower volumes required in our businesses and the tendency for us all need to lower our risks in the troubled retail times. We would all prefer to buy closer to the season with smaller more regular injections of newness to please our demanding new modern fashion savvy consumer. So, is far east manufacturing still relevant for the European lingerie market?
China’s role in the fashion supply chain
China is deeply embedded in all aspects of fashion’s supply chain around the globe. The World Trade Statistical Review found that in 2018 that China exported £91.1 billion of textiles and £121.5 billion of clothing, making it the world’s biggest exporter and it’s responsible for 37.6% of all global textile exports. The Telegraph reported a year ago that “More than 70 per cent of global environmental pollution is from China’s manufacturing industry, which generates about 6.2 billion tonnes of waste per year”. As a manufacturing giant, China with their lengthy lead times, high MOQ’s and long cycles of manufacturing, all seems out of date and no longer suitable for the little and often approach that our Intimate Apparel and fashion market now need.
Our government has sought to ease the pressure on financial markets by offering huge cash injections of around £500 million so far, to help stabilise our markets. Retail sales are now drawing to a virtual halt with our high streets and most online retailers closing their doors. What will happen to all those summer stocks sitting in customs, waiting in factories, or just hanging around in the shops? We believe that it’s the ideal opportunity to review your current supply chain and invest in a new one. You can switch out your supply chain and investigate some more traditional manufacturing routes. These historical routes include Portugal, North Africa, Italy, Romania, Latvia and Southern Europe which are becoming more interesting again for the intimate apparel markets. North Africa and Portugal seem to be leading the way in aiding lingerie businesses that are looking at moving away from China.
Perhaps now is the time to re-evaluate how we operate
It’s time to reconsider, re-evaluate as a nation, as we are far too reliant on China, let’s give the smaller and more underdeveloped manufacturing regions that are closer to home the chance to prove themselves, a chance to grow and develop with us in a manageable, sustainable manner.
John Stevenson, retail analyst at Peel Hunt describes businesses as “in the waiting room”, unable to predict or plan for the longer-term impacts until the length of the delays becomes clear. Buying offices and factories in China are re-opening, but capacity remains limited and If the situation does not improve, late summer deliveries and autumn 2020 stock will be hit hard.
Lingerie businesses should consider contingency plans and sustainability
Going forward businesses need to put their contingency plans in place and there has been movement away from China already. Retailers will be loath to make a knee-jerk move away, but for a couple of seasons now businesses have discussed how balanced and flexible their supply chains are and how attractive it is making products closer to home in a more sustainable manner. The Covid-19 outbreak adds weight to the case for supply chain diversification. There are sustainable practices that companies should be wanting to implement and changes, that at last can be made.
It’s a given that consumers will see smaller numbers of products on the shelves this autumn/winter season. There is also the potential for price rises to counteract some of the expenses caused by delay, but personally I think this is not a bad prospect and I would hope that longer term it takes us back to producing good value clothing and moving away from the throwaway society we have become.
The shelves may be emptier in the future but is this a bad thing?
There may be some empty shelves in stores but that might just provide more room for us to shop comfortably and enjoy the experience once again. I’m more than a little fed up with the aisles in shops getting smaller and smaller because of more and more rails being introduced onto the shop floor, trying to cope with another season of overstocks. If the last month and the impact in China has taught us anything, surely, it’s that life is not all about mass shopping and it’s about the bigger picture, which includes manufacturing in a sustainable manner.
The fashion industry is out of harmony with the seasons
For decades now the Fashion industry has been out of sorts with the reality of our seasons, flooding the market with stocks that simply sit on the shelves waiting and waiting, season after season, for the right weather to come along. That seems like madness! We moaned about tying up our budgets too early 25 years ago and whilst some new technology has allowed us to be more efficient, we continue to flood the market too early with mountains of stock that feeds our “sale times”. We are like little hamsters running around the same wheel, continuing to feed the monster that’s no longer that hungry, chasing figures and budgets that continue year after year to be unrealistic and unachievable. We have spring stock arriving pre-Christmas, summer stock arrives in stores in spring and then all our summer clothing goes into sale in June, just as our summer starts to make way for autumn deliveries and the madness goes on!
It looks like we could be “back to normal” around July or August thus losing us 4- 5 months in the product development, supply chain and most importantly selling season. Does that mean that now is the ideal time to realign the disconnect with our seasons as well as review our supply chain?
Let’s make some changes.