Fashion sales to be challenged until late 2023 - McKinsey
Fashion sales have been devastated so far this year by the impact of the pandemic, but new figures suggest that they won't be seeing a fast bounce-back. In fact, fashion sales aren’t predicted to recover fully in the UK until Christmas 2023.
Recent news that the UK is seeing a second wave of the coronavirus, plus the new restrictions that have been put in place in certain areas being likely to crimp any recovery, all make it a tough time to be in fashion retail.
The prospects of working from home lasting for many months and the Christmas party season being non-existent mean the need to buy new fashion pieces is quite low for many consumers.
The Telegraph reported that current data from McKinsey shows 43% of people are spending less on clothing than they did before the pandemic. It added that if the virus can’t be successfully contained in the few months ahead, it could take four years before they recover fully.
“[This] will mean a continued shift to shopping online,” Anita Balchandani, a partner at McKinsey specialising in retail told the newspaper.
However, as with all predictions, there’s no certainty around this one and Balchandani added that “the need for self-expression and getting back to some kind of normalcy is starting to take hold.”
She also said any recovery seen so far has been very uneven: “Averages stop mattering in times like this. People are no longer going into multiple retailers on a trip to the high street - instead they go to one specific website or the store of choice, reinforcing a winner-takes-all situation.”
But if the 2023 prediction is correct, it means a number of brands won't survive and those that do make it through will need to think differently.
Balchandani said brands are already adjusting to the demand reset and the channel shift. But McKinsey’s figures also suggest around three-quarters of brands will be “in imminent distress without government help”.
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