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How Matches’ Collapse Could Impact Independent Fashion

The luxury retailer’s closure has far-reaching knock-on effects for independent brands. Unpaid bills for inventory have pushed some labels into dire financial straits, while confidence in other stockists like Farfetch-backed Browns has sunk to a nadir.
Matchesfashion's Carlos Place townhouse in Mayfair, London
Frasers Group placed Matchesfashion into administration just months after acquiring the struggling luxury retailer. (Shutterstock)

Key insights

  • Independent brands are still in the dark regarding whether they’ll be paid for orders produced for Matches before it was placed into administration.
  • Confidence in Farfetch-backed Browns is also faltering, with brands now limiting or pausing orders with the shop.
  • Smaller labels are pivoting to direct-to-consumer sales, targeting ultra-wealthy clientele and aggressively cutting costs to hedge against the volatile luxury e-commerce market.

LONDON — Nearly a month after London-based retailer Matchesfashion was placed into administration, independent labels remain in turmoil and uncertainty over when they’ll be paid for orders produced for the retailer — as well as how they might make up for the lost sales elsewhere.

The closure of Matches, announced after Mike Ashley’s Frasers Group abandoned plans to turn around the loss-making e-commerce site, blindsided employees and brands. The move occurred just days after the retailer’s buying directors flew back from placing orders at Milan Fashion Week, and less than three months after Frasers acquired the site.

Trouble had long been brewing for the embattled retailer, which reported £40 million ($50.6 million) in operating losses in 2022, up from £25 million in the previous year. With revenues of £380 million, Matches is a smaller player compared to the likes of Farfetch and Yoox Net-a-Porter, but has historically played an outsize role for independent fashion due to its idiosyncratic buy and long-held image as a booster of small brands.

Matches, which was once valued at $1 billion when it was acquired by Apax Partners in 2017, sold to Frasers Group in a fire sale last fall with its new owner paying just £52 million. By March, the group announced it had placed the retailer into administration and was cutting 273 jobs, over half of Matches’ staff. The retailer is still accepting online orders and this week is holding a clearance sale at an East London venue, offering customers 90 percent off on brands like Jacquemus, Jil Sander, Self-Portrait and 16 Arlington.


Worrying Signs

Vendors say Matches was increasingly requesting sizeable discounts on invoices in the months prior to the shutdown. Turmoil at larger rival Farfetch, which sold to South Korea’s Coupang in a December deal that wiped out most shareholders, provided another signal that brands should rethink their dependence on luxury e-commerce. Still, for many independent labels, the changes may have come too late.

“We had stopped future deliveries to [Matches] to mitigate risk, but unfortunately had already shipped 90 percent of their spring-summer 2024 order in early January,” said Tessa Griffith, managing director of London-based womenswear label Molly Goddard. While the brand known for its £1,190 ($1,496) taffeta dresses has sought to ramp up its direct-to-consumer business in recent seasons, “for a time [Matches] were one of our largest stockists,” Griffith said. The brand declined to comment on the administration process and whether outstanding invoices will be paid.

Molly Goddard is just one of the independent labels to be impacted. Tomorrow Ltd — a brand accelerator and distributor that has invested in brands including A Cold Wall, Martine Rose and Coperni — has taken less than £50,000 worth of orders for the most recent season, down from orders in excess of £1 million previously. Rosh Mahtani, founder of London-based jewellery label Alighieri, told The New York Times last week that Matches was responsible for roughly £500,000 ($629,000) of her projected annual revenue.

“It is clear from conversations that we have had that the failure of Matches has significant repercussions for the wider fashion retail sector, and we’re working at pace with funders and the BFC network to develop a package of support for designer businesses affected,” British Fashion Council chief executive Caroline Rush told BoF over email.

A Broken System

Matches’ downfall has compounded an already punishing climate for independent fashion businesses, whose limited funding and niche offering often make it impracticable to operate retail stores, but for whom the path to profitability at wholesale is increasingly narrow. Brands are contending with rising inventory costs and logistical snags as well as the continued decline of department stores and multi-brand e-tailers. Luxury demand has cooled from post-pandemic highs, with the UK taking an especially hard hit due to the economic fallout from Brexit and the removal of tax-free shopping for tourists.

London-based Farfetch, which connects multi-brand boutiques to its vast online marketplace as well as providing white-label e-commerce services for brands and retailers, was rescued from the brink of bankruptcy when it was acquired by Coupang in December. The company’s plight raises questions over the broader ecosystem of stores and brands that stock the platform, as well as the future of Browns, the historic London-based luxury boutique it acquired in 2015, which is a major account for many small and medium-sized designer brands.

“It’s a race to the bottom,” said Stefano Martinetto, chief executive of Tomorrow Ltd. “The first question I ask of new accounts these days is not when they will make payment, but if they will pay at all.”

“There’s a feeling that independent designers and smaller labels are always last to be paid because retailers feel the need to preserve relationships with big luxury brand vendors,” Martinetto added.


It’s a sentiment that’s shared across the industry. “In 36 years in the business I’ve never seen an environment as bad as this,” said John Murphy, president of London-based luxury womenswear label Natasha Zinko.

Murphy shared the widely-held concern that Browns could be next to fall after Matches: after securing payment for its resort and spring collections, Natasha Zinko decided to stop working with the retailer in November.

Like Molly Goddard, many were seeing signs of the disintegrating luxury e-commerce system long in advance. Yet because online wholesale remains such an entrenched part of the way small brands do business, most could only take measures to mitigate losses rather than avoiding damage completely.

A Survival Strategy

In theory, the simplest way to decrease exposure to the volatile world of luxury e-commerce is to pivot to direct-to-consumer sales — a strategy that cuts out the middleman, builds closer relationships with customers and boosts margins. But pivoting to DTC is easier said than done. Digital marketing is a costly exercise at a time when it’s harder than ever to grab consumers’ attention online, while going direct-to-consumer also comes with operational headaches for small organisations often ill-equipped for the logistical challenges of distribution and order fulfilment.

“For smaller brands selling directly without the support of a distribution or licensing partner or a wealthy backer, this is also an impossible task,” Martinetto said.

Some brands are turning to niche pockets of wealthy consumers, refocusing their product offering and marketing to categories where they feel more confident they’ll see a return.

For Molly Goddard, this has meant ramping up its bridal and made-to-order businesses, while retaining a handful of key wholesale accounts for ready-to-wear, Griffith said.

At Natasha Zinko, the brand is focused on cost-saving, looking inward to focus on top-selling SKUs and relationships with retailers like LA-based Maxfield and multi-brand boutique chain The Webster. Those accounts are still seen as indispensable for getting products in front of the right audience who will covet (and can afford) the brand.

Any and all expenses are up for review: “You constantly have to question every few months: ‘Do we pay for production? Do we need to put on a show this season? Do we need to pay for a certain campaign?”, Murphy said. “Because the ultimate question for smaller brands at the moment is simply: do we just close down?”

Further Reading

Why Frasers Group Shuttered Matchesfashion

In the latest blow to the luxury e-commerce sector, the embattled Matches is closing down just over two months after being acquired by Frasers Group as relationships with brands have reportedly soured.

For Luxury E-Commerce, It’s Even Worse Than It Looks

US consumer spending across online luxury sellers like Farfetch, Matches and Net-a-Porter suffered sustained declines throughout 2023. The question is whether the downturn is simply temporary or the luxury e-commerce model itself is broken.

How to Recession-Proof Independent Retail

Small stores can remain competitive by scaling their private labels, testing new store concepts, and offering brands consumers can’t find on Farfetch or in Selfridges.

About the author
Daniel-Yaw  Miller
Daniel-Yaw Miller

Daniel-Yaw Miller is Senior Editorial Associate at The Business of Fashion. He is based in London and covers menswear, streetwear and sport.

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