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Fashion retailers in the West are desperate to reopen for business, but anticipate a step-by-step process, with restrictions varying from country to country. Financial pressures are mounting by the week, with American department stores particularly hard hit. Meanwhile, London Fashion Week is experimenting through the launch of a three-day online event in June that will feature both menswear and womenswear.

Here, Vogue Business highlights the latest news from the luxury industry and related sectors.

Lockdowns ease worldwide, retailers prepare for a new normal. A clear path to exit from the pandemic lockdowns has yet to be defined, despite piecemeal moves in European countries and some US states. While scientists are urging extreme caution in the face of one of the world’s biggest modern health crises, the economic impact of the unprecedented lockdowns is worsening by the week.

Fashion industry executives are becoming more vocal as financial pressures mount, led by Uniqlo’s founder Tadashi Yanai, who has criticized Japan’s testing and lockdown strategy, calling for much broader testing. “If you just ask everyone to stay at home, the economy would collapse.” In an interview with Vogue Business, American designer Tory Burch says much of the aid formulated by the Trump administration and Congress have focused on the travel and restaurant industries and is missing much of the US apparel sector.

Led by smaller stores already open in Germany, retailers across Europe are preparing to reopen in May, but with the implementation of strict social distancing measures. The British Retail Consortium’s guidance, drawn up with Usdaw, the UK’s shopworkers’ union, advises closing or limiting access to changing rooms as well as the introduction of one-way systems in stores. A McKinsey report advises retailers to focus on contactless fulfillment, curbside pickup, and ‘buy online, pick up in-store’ options.

Factory Workers — Bangladeshi workers work at a garment factory in Savar outskirts of Dhaka on February 6, 2020. The garment sector has provided employment opportunities to women from the rural areas that previously did not have any opportunity to be part of the formal workforce. This has given women the chance to be financially independent and have a voice in the family because now they contribute financially. However, women workers face problems. Most women come from low income families. Low wage of women workers and their compliance have enabled the industry to compete with the world market. The textile and clothing industries provide the single source of growth in Bangladesh’s rapidly developing economy. Exports of textiles and garments are the principal source of foreign exchange earnings. Bangladesh is the world’s second-largest apparel exporter of western (fast) fashion brands. Sixty percent of the export contracts of western brands are with European buyers and about forty percent with American buyers.
(Photo by Mehedi Hasan/NurPhoto via Getty Images)

Pressure builds on US department stores. Some of the most storied names in American retailing face an uncertain future, led by department stores, many of which were in trouble before the pandemic.

Neiman Marcus is expected to seek bankruptcy protection this week, although an investor group, including investment firm Mudrick Capital Management LP and hedge fund Third Point LLC, is challenging a planned $600 million financing package. The investors’ alternative plan would force the department store group to sell itself, with potential buyers including Saks Fifth Avenue owner Hudson’s Bay Company, according to Reuters.

Factory Worker smiling

Lord & Taylor and JC Penney are both reported to be considering bankruptcy protection, the latter seeking a loan of up to $1 billion. Macy’s is reported to be seeking to raise as much as $5 billion in debt to help it through the pandemic. In the specialty sector, casualwear retailer Gap warned on 23 April in a securities filing that it may not have enough cash flow to fund operations. The company has stopped paying rent on its shuttered stores and is looking for new debt financing.

Textile workers in Dhaka, Bangladesh, defy lockdown to demand payment of their salaries.

Brands show support for suppliers. As the crisis deepens for Asian suppliers of Western retailers, a group of employers’ organizations, unions, and brands is now working with the International Labour Organisation (ILO). An agreement commits retailers, including leading global names such as Inditex and H&M, to pay manufacturers for finished goods and goods in production, the ILO said. An international working group will seek to reduce the impact of the pandemic on industry workers worldwide.

Textile workers protested in Dhaka, Bangladesh, on 26 April, defying the country’s lockdown. Despite a $588 million government aid package, they are desperate, with workers abruptly left without wages facing starvation. Globally, full or partial lockdown measures are now affecting almost 2.7 billion workers, representing around 81 percent of the world’s workforce, the ILO says. Fashion Revolution Week, held from 20-26 April, called for brands and manufacturers to “rebuild a fashion industry that values people over growth and profit, and conserves and restores the environment as we come out of the other side of this global crisis”, according to a statement from the organizers.

Fair trade worker

London Fashion Week goes digital, gender-neutral. For the next 12 months, all London Fashion Weeks will merge womenswear and menswear into one gender-neutral platform, the British Fashion Council has announced. Its next event, scheduled for June 12-14, will be a digital-only platform, targeting both trade and consumer audiences. The first purely digital fashion week was Shanghai Fashion Week, held 24-30 March. A total of 150 designers and brands live-streamed via Tmall, Alibaba Group’s e-commerce platform, attracting 11 million views. Meanwhile, in Italy, Ermenegildo Zegna is promising a “phygital” Spring/Summer 2021 menswear show for early July, featuring a performance live-streamed combined with pre-recorded footage, using CGI technology. It will show the premium Ermenegildo Zegna XXX collection.

Key takeaways:

Governments in the West are planning a gradual easing of lockdowns, requiring flexibility from fashion retailers.
Department stores in America, led by Neiman Marcus, face a period of reckoning as financial pressures pile up.
London Fashion Week will go digital in June, with an experimental cross-gender event planned, following the example of Shanghai Fashion Week.
Fashion industry anticipates return to work in May. Industry feels this might be enough time to slowly go back to work.

#Fashion industry anticipates return to work in May

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