• The Fashion Sloth


Updated: Apr 3, 2020

Impacts of COVID-19 on the economy are already visible and a radical change is about to happen and can't be avoided.

Just like the visit of your not-so-favorite cousin Paul during your Christmas holidays or the typical "It's chicken, is it OK?" when you clearly say you're vegetarian. No Susan, it's not OK!

Some speak about a possible 2 years recession, some others are seeing this crisis as the beginning of a new era of deep social and economical renewal. Some are scared to the bones thinking of what future will bring and some (like me) are actually seeing this as a HUGE (and highly needed) opportunity to move our asses, learn from our mistakes and start again from scratch.

The fashion industry is also going through major structural changes and everyone agrees that thing will NEVER go back to normal after this.

New categories...

Home wear, lounge wear all the way to sex toys: even if recession is there and is clearly affecting local economies worldwide, there are some categories that are not doing that bad. We are going though a radical change in human behavior and new practices like working from home are becoming the new focus, even for the retail industries.

... and new customers...

Turns out some people are still shopping: as BoF mentions "Young consumers overall are more likely to shop online right now than older ones, according to data from Afterpay, an online payment service that allows consumers to pay for purchases in installments. More than 70 percent of all purchases made by Afterpay customers are from Millennials and Gen-Z".

Brands selling street wear for the youth have been actually performing quite well, as it's been the case of the LA based brand Chinatown Market or the NYC brand Fall Risk.

This is due both to their contemporary and ground-breaking business models (“Our drop model makes us less vulnerable,” said label’s founder John Targon. “I can recut my best selling products and it’s allowed me to be extra nimble, and I’m never sitting on inventory.” cit. BoF) and their strong presence on social media channels that are the playground of both Millenials and Gen-Z. As you can assume, the more people get bored at home, the more they buy random shit pushed on IG by influencers.

...with new needs

In times of crisis, people are also shifting towards a more "sustainable" and "local" way to purchase in order to help smaller business instead of throwing even more fuel into the big corporations fire (I've been very much attracted to all things fire lately... hope I'm not developing some sort of pyromania issue... my therapist could not afford this on top of all the other shit, I guess...)

What now?

Financial experts question whether consumer sentiment will return to pre-2020 levels as the pandemic is changing the way people shop around the world.

Still, sixty-six percent of fashion executives surveyed by BoF are optimistic that their companies will bounce back. This will not happen probably anytime soon, especially if they don't take the necessary and urgent steps right now to go hand in hand with the world needs of tomorrow.

In the meantime, US, European and Chinese stocks dropped further on Wednesday, forecasting that markets are in for their worst quarter since the 2008 financial crisis.

"Already retail traffic in the US is down about 80 percent in the third week of March, compared with a year earlier, according to Morgan Stanley, and will likely drop further". The $2 trillion stimulus package announced this week can't do much: businesses will be able to borrow money to pay their rents, debts, etc... but this might not be a sustainable solution on the long run. What will happen after this Corona crisis?

Who's paying the consequences?

Of course, this shit storm is affecting the way the big retails fellas are reacting.

Less demand, less orders. Is that a problem? Not at all! Fashion brands are violating guidelines from the United Nations and the Organisation for Economic Cooperation and Development as they cancel orders or fail to pay their suppliers, according to a report by Human Rights Watch.

Social media and advertising is also getting slower as companies are drastically cutting on costs, forcing many agencies to shut down (see the announcement made on LinkedIn ,for instance, by David Fisher, founder of media guru Highsnobiety)

False commitments, in vain promises, dramatic cost cuttings: companies have already begun to lay off or furlough workers (big names such as Macy's, Everlane, J.C. Penney or even Kohl's among others). This process is not defined and is unprecedented which create even more grey areas, doubts and fear.

No surprise, the weaker are the ones bearing the cross. Because let's face it, even in "fast" fashion, we are not very "fast" learners and it might take us a while before we wide open our eyes and stop averting our glances from the real predicament.

One of the worst cases is what's happening in Bangladesh these days, where 4 million people work in the clothing industry, most of them being women (data from The New York Times, 2014). Have a look at this video of Katharine Hamnett made by #FashionRevolution about the impact policy makers have and why it is important to awaken people on this very foundation of the issue. Laws are key and institutions have a massive role and responsibility to make the change happen.

We all remember the infamous happenings at the Rana Plaza where 1,100 people died, 2,500 were injured, but well, how beautiful is that Primark t-shirt you bought that these people made?

The current situation in Bangladesh is dramatic as $1.5 billion orders have been cancelled by Western retailers only. 1,089 factories closed, 1.2 million workers affected, the same amount of people of cities like Brussels or Dallas.

According to the Times, another $1.8 ish billion has been put on hold which makes (let me get the calculator...) more than $3 billion in orders lost. As a reminder, we are talking of Bangladesh only, which is the second bigger manufacturing country right after all mighty China.

Companies like Primark (we begin not to like them that much, huh?) but also Britain’s Marks & Spencer and Tesco or then again the Americans Walmart and Target, are "using a force majeure clause in its contracts to cancel orders". Chains with 376 stores in 12 countries... bitch please....

An amazing job to compile all this information (and believe me, it's a LOT) has been done by Pennsylvania State University’s Center for Global Workers’ Rights and the Worker Rights Consortium, a Washington, D.C.-based labor rights organization (see infographic above). According to their live update of information on the Bangladesh COVID case ("The COVIDesh gate" as I, extremely originally, call it), some companies like Swedish giant H&M or Spain based Inditex group were also blamed guilty of non payment upon orders cancellation but have finally engaged themselves to pay. The numbers are being updated daily.

Why should they pay for something not made yet? Well, most fashion companies (honestly like 99,99% of them) pay orders only upon delivery to the established port, accordingly to the delivery conditions negotiated (incoterms) .

This means that supplier basically have to pre-pay for all fabrics, trimmings, salaries and other business-running costs BEFORE they get the money from the company. If the company does not pay for the orders, all of this money invested is #ByeFelicia 'ed.

Workers in Bangladesh in the clothing industry have begun strikes and protests (as mentioned by the Myanmar Times) after "at least 20 out of the 500 manufacturing facilities in Myanmar have shut down, leaving more than 10,000 potentially without jobs due to pandemic (...) Fifteen factories have ceased operations permanently, while five others stopped operating temporarily since January. Others have cut the number of workers."

Different country, same shit: also in India, COVID threatens (well, not the virus directly but the way too fucked up current economical system) garment workers that are obliged to live together in premises next to the factories waiting for them to reopen. After India announced the lock down that affected some cities, around 300,000 workers see themselves obliged to share tiny spaces in not-so-hygienic conditions in pseudo hostels, where confinement is close to zero and chances to get the virus close to 100%. Welcome to the wonderful world of fast fashion, people! *CLAP YOUR HANDS*

Moving aaaaaallllll the way to the Americas, a similar situation is happening in El Salvador, Honduras or Guatemala. Manufacturing workers are threatened by employers with salary cuts, lay offs, forcing them to remain at their workplace (even under imposed governmental confinement) or even retaliation in case of seeking for shelter via the creation of labor unions.

Slower fashion? It would be about time.


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