From manufacturing supply chains to fashion weeks and trade shows, the repercussions of the novel coronavirus pandemic are shaking up the fashion industry as we know it. This phase, which can well last over months, poses unprecedented economic and social damage for global industries. Retail and manufacturing industries worldwide are amongst the worst hit with companies going bankrupt and shutting stores almost overnight. In such a scenario, fashion is the last thing on people’s mind right now.
“The trickledown effect of consumers not spending has affected everyone, from retailers to weavers. Most young brands with not enough savings will probably shut down, which will result in a major loss of talent,” Shweta Kapur, Creative Director of Indian label 431-88, told Apparel Resources.
With factories and supply chains shutting down due to the nationwide lockdown, all work has come to a standstill. Orders in hand have been kept on hold, resulting in rising concerns of deadstock. Commenting on the same, Amit Vijaya, Co-Creative Director of Indian handloom label Amrich, said “The lockdown, which in a way is necessary to prevent further spread, also prevents any processes for work to function. Manufactured stocks are just lying and the fear is that the season would pass by without being able to get it to customers.”
The situation is grave in Amrich’s case since the label works with handloom textiles and the abrupt halt of production and sampling means that a lot of their artisans are unable to work for their livelihood.
The situation poses still a greater threat to designers whose business models focus on trend-based clothing. Given the short lifespan of such fashion, even putting old stock on sale would backfire since it would lack relevance and interest. “Fashion works on a seasonal, pre-make, risky investment system and the ongoing unprecedented times do not denote its end date to plan the future, which is why the set business plans, investments on stock, events and business strategies have shaken or have gone on standby. We would be seeing a lot of deadstock coming to the forefront soon,” said Akshat Bansal, Founder of Bloni.
Also Read: How the fashion industry is fighting the coronavirus crisis
With businesses suffering worldwide and companies initiating layoffs and pay-cuts, the way we perceive fashion is fast changing. Consumption, consumer spending and intent are all key driving factors in the limelight now with brands and designers struggling to identify what the next step in this uncharted territory should be.
Keeping the situation in mind, it is inevitable that fashion labels and brands will need to implement mark downs during this period of uncertainty, in order to encourage purchases and keep afloat.
According to a report released by McKinsey, as countries move through the contagion curve, there are pockets of increasing spending even as consumers universally pull back on discretionary spending. Online buying has spiked up almost everywhere around the world, but that shift has not come close to offsetting the overall reduction in spending.
In the case of labels such as 431-88 and Amrich, online retailing has been strong during this period, but due to the lockdown, no dispatches have been made yet. Everything will be processed once the lockdown is lifted and the situation normalises a bit and our customers are aware of that,” Shweta explained.
Akshat, on the other hand, feels that pushing sales online feels too forced during such sensitive times. “What is the future of events and social gatherings? We are fashion designers, and fashion doesn’t comply only with clothing; I believe in keeping myself open to collaborations, taking fashion to a much larger space than just selling clothes. Hence, we at Bloni are pushing to sustain money by other means of income such as strategising for creative industry and businesses worldwide.” He elucidated, adding, “We are producing protective face masks to donate and retail for having a running atmosphere at the atelier. Pushing sales through departmental and medical stores across the country, forecasting materials, reimaging the future for a better and stable tomorrow, and also working on our new online retail website for a satisfying, interactive and simpler user interface.”
But apart from a decline in sales, graver challenges are being faced by designers and brands that not only have the issue of piling up stocks but also unutilised workforce. Though majority of designer labels have pledged to pay their skilled workers in full and support them during this period, it is a matter of time when the blaring question of how long this can last comes to the fore.
“The major challenge for us is the planning of our production cycles in terms of textiles. Working with handlooms means we have to begin work on sampling, etc. at least 6 months in advance. Currently, the situation doesn’t allow us to plan in advance, as no one knows when and how the time will progress.” Amit said, further adding, “Another major challenge being faced is the financial support to our team. Thankfully, at present, we do have the ability to sustain and not lose any of our artisans to this catastrophe. However, in the long run, with no point of sales or income generation, without support from the Government, it would be impossible to go on.”
For Shweta, whose strategic business acumen has allowed them to pay salaries in full up till now, the concern is the same. “The major challenge is how to handle the fixed overhead costs. We are lucky that we can take a hit for a couple of months, but it will be tough beyond that. Currently, our main concern is the health and safety of our team members. COVID-19 has taken a huge toll on our projections for the year, so we are now figuring out new strategies to catch up,” Shweta stated.
This slowdown definitely gives fashion businesses a time to reflect and plan their existing business strategies and plan for the changed face of fashion and retail post this period. Outdated methods of working will no longer work with consumer habits and spending undergoing a massive transformation in itself.
Commenting on the same, Akshat said, “The coming months will be quite unpredictable and uncertain, but having said that, I see a very bright future. Well, if history is anything to go by, all big fashion movements mostly happened after a world shake-up.” He further elaborated, “I see designers selling existing deadstock at discounted prices to kick-start post lockdown. I see businesses chasing technology and digitalisation more than ever, essentials becoming more advanced and capsulated, and togetherness becoming more intimate and important despite people being more isolated than before. I see an amalgamation of collaborations where science, art, design and technology come together to revisit possibilities for a better future.”
Fashion and creation are not going to stop. For Akshat, Bloni’s range plan may have fewer number of pieces, focusing on more regional-based clothing, but most importantly, keeping a very strong brand identity in sync, where sustainability, comfort and functionality all collide, will be the brand’s priority.
“Virtual reality would be the new ‘normal’, spreading to encompass fashion, beauty and events where visiting offline bricks-and-mortar stores will likely become more of an experience. A belief in the thought process that ‘more is more and is harmful’ may finally embed in our DNA. Sustainability and containment will command our lives like never before.” –Akshat Bansal, Founder, Bloni
Validating the same, Shweta cited, “We’ve taken this time to also figure where we are currently lacking, and cutting off all unnecessary expenditure. Luckily, 431-88 is not a seasonal brand and we only work with separates, so it is easy for us to jump the traditional calendar and offer products that can be wardrobe essentials for years. There will definitely be a huge shift in consumer behaviour in the coming months, and we are currently studying and analysing that,” further adding, “Indians are emotional spenders. With everything going on around us and the looming recession, people who can spend would also be a little wary about shopping. When the lockdown is lifted, people would still be hesitant to step out freely for at least a while. Summer in the country is usually slow for fashion and it only picks up during the August-September period with Diwali and the wedding season coming in, but I see more people wearing things that they already own instead of buying new things.”
“Indians are emotional spenders. With everything going on around us and the looming recession, people who can spend would also be a little wary about shopping. I see more people wearing things that they already own instead of buying new things.” – Shweta Kapur, Creative Director, 431-88
The need of the hour is Government support, especially for digital-first designers and brands that face an existential threat in the light of coronavirus. Suggestions such as freezing rents, funding, interest relaxation, etc. seem to be the most in demand among the designer lot.
“What the industry needs is financial aid from the Government to help sustain salaries, so that we don’t see folding of businesses. Freeze on rental dues is one of the key things almost everyone is demanding. At the moment, the Government allowing some factories to operate in order to manufacture masks and other essential items that are the need of the hour has somewhat contributed to aiding the industry,” Shweta cited.
During this time of crisis, the core bodies of fashion in India – The Fashion Design Council of India (FDCI) and Lakmé Fashion Week – have launched a COVID-19 Support Fund to provide financial assistance to small businesses and young designers in need. Commenting on the same, Amit said “Through organisations such as the FDCI, the Indian Government has been made aware of the crises that are to fall upon our industry. The Government has said they would help, but it remains to be seen what methods they would apply to help. It is extremely important that concrete plans are put down, as it is not just the designers that are affected but also the entire chain of people who keep the machinery running.”
But still, when we separate the Indian design industry from the textile industry as a whole, a lot of issues still remain to be understood. A relatively new and niche sector with different scales, categories, catering markets, market places, hidden facts, highly skilled staff, and employees, the Indian fashion space is still evolving.
Elaborating on the same, Akshat said, “The Government needs to understand the Indian fashion sector first to start helping. They need to create a special team that listens to the problems, situations, issues of individual companies to command help and support. Some companies may require funding, and others may need strategic help with accounts and managing finance including long-term planning. Most of my contemporaries would just do great if they have an experienced helping hand in making a better ROI, instead of running the show all alone.”
This period is also a great time for businesses to reach out and connect with their customers in order to build a loyal base. With almost the entire world under home arrest and a Wi-Fi at hand, it has never been easier to grab eyeballs. Thus, with proper communication, a brand can use this time to strengthen the most prioritised factor for success in retail – consumer engagement.
Bloni is taking its consumers on an archive journey, wherein they are opening up their research and process books for a better understanding of the brand. Making them truly believe in the brand would result in the creation of a stronger connection.
Even for 431-88, right now is really about community building. “Rather than pushing products and sales, which honestly can’t be fulfilled till the lockdown lifts and also somewhere a little tones down, we are focusing more on things that the 431-88 woman enjoys doing and can do at home. Women from our community, which is made up of our clients, partners and vendors are pitching in with their areas of expertise, whether it’s sharing recipes, books, workouts or just how to be mentally engaged. Right now, it’s a time to pause, re-set, re-align and reflect,” Shweta revealed.
“The same old ways of emotionless online retail therapy are not going to work in the near future. We need to remember that the web lacks tactile association, and high fashion clothing has a lot to do with touch and feel, therefore we should look forward to striking a balance. Exchange and return, fitting and sizing need to be revaluated if online retail for fashion is the new ‘normal’. – Akshat Bansal, Founder, Bloni
