With news of the Coronavirus now reaching Europe and America, after already taking a huge toll on the workforce of China, fashion braces itself for the aftermath in the days and months ahead for sales and our supply chain. As we remain entrenched in a global market, here's the ways the CoVid19 is already affecting the fashion industry and what we can predict as a result.
With 1/3 of fashion production taking place in China, this is where we are expecting a big hit over the coming months. China has quarantined citizens for weeks in an effort to slow the spread of the Coronavirus. Now as workers slowly go back to work they are met with a mound of production that has not been touched. Brands with their entire supply chain set up China will feel the brunt of this the most, but we should expect delays in shipment this spring as well as dangerous work demands on the Chinese garment worker to catch up for lost time.
Supply Chain to Expand Outside of China
The back and forth trade wars between America and China in the last couple years have already sent production teams on a mission to find new sourcing options that offer more dependable pricing. Now with the halt of production and the unease of how long it will be before China is back to full speed, brands have an immediate incentive to shift production to hungry and burgeoning markets such as India and the African continent.
Cancelled Fashion Shows
As Northern Italy became the point of origin for the Coronavirus outbreak spreading to Europe, unfortunately just in time for Milan Fashion Week, 8 brands (including Armani) chose to cancel their shows in both Milan and Paris and many would be attendees (buyers, press, and influencers) chose to cancel their travel plans. Even the recent SOURCING at MAGIC trade show in Vegas experienced about 40% of their exhibitors unable to attend due to travel bans mixed with contagion worries.
Sales Slow and Stocks Plummet
With many fashion houses counting on the Asian market as it's heavy hitter for revenue growth, this quarantine and travel ban has naturally halted retail sales as well. Many stores across Asia have been closed for well over a month and they are still unsure when normal business hours will resume. Add to that the lowest dip in the stock market since the 2008 recession and all our major public companies are on the edge of their seat as well.
Face Masks are Trending
Never one to let a good trend go to waste, the runway shows that did go on are already touting a sartorial spin on the medical face masks that have been flying off the shelves. We can only see more of these coming down the pipeline for spring/summer...you know as soon as China can get back to work to make them all. Le sigh.
Are you unsure of setting up a supply chain in China and want to consider alternative options? Or maybe you're scrambling and need a fast solution to a garment manufacturer outside of Asia? Our Ethical Manufacturing Platform offers a variety of ethical factories in the Asian sub-continent, Europe, and South America. Schedule a call today to tour the platform, get answers, and start getting quotes from factories immediately.