The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
Arabelle Sicardi just wants something fun to wear to parties this summer.
The freelance beauty writer, who lives in New York, is fully vaccinated and ready to go out again. But after several fruitless shopping excursions and hours perusing the web, Sicardi has given up on the idea of refreshing her summer wardrobe.
“There’s just nothing interesting ... and nothing new,” she said. “If I see another Hill House dress, I will scream.”
Sicardi is referring to the “nap dress,” a play on the house frock featuring a loose flowing skirt under a smocked bodice. The version sold by Hill House Home wasn’t the first, but for many, the linen maker’s version of the garment came to epitomise pandemic fashion in the United States after it generated $1 million in sales in just 30 minutes after one drop. Dozens of brands now offer their own takes on the style, which is touted as comfortable enough for lounging around the house but stylish enough to wear in public.
There’s just nothing interesting ... and nothing new.
But as much of Europe and the US reopen, shoppers like Sicardi want flashy new outfits designed to be seen in, not to sleep in. Brands are leaning into the idea that the post-pandemic era of parties, hookups and other recently taboo social activities are back with a vengeance.
The clothes on offer don’t always reflect the changing mood, however.
Many mass-market and contemporary brands are still trying to move last year’s styles, or even squeeze a few more sales out of slip dresses, floral prints, loose A-line silhouettes, puffy sleeves and other pre-pandemic trends.
The reason so many stores are selling warmed-over styles dates back to last fall when designers and buyers were planning their summer assortments. At the time, the pandemic was still raging, and there was little visibility into when it would subside. Many were wary of taking a gamble on new looks.
The result: womenswear brands and retailers in the US and UK introduced six percent fewer styles in the first six months of 2021 compared with the same period in 2019, according to Edited. Luxury brands have been bolder about introducing new looks: high-end labels unveiled 18 percent more new items over the same period because luxury brands have bigger budgets on collections and didn’t experience the same dip in demand at the height of the pandemic, according to Divya Mathur, chief merchant at Intermix. Independent mass and contemporary brands, on the other hand, were squeezed much harder in 2020 as their customers were less insulated from the financial impact of Covid-19.
Compounding the issue, stores have struggled to stock even the limited selection that brands have ordered. Factory backlogs and labour shortages have slowed production, and surging demand for everything from automobiles to swimsuits has created global transportation bottlenecks. The cost of ferrying containers across the Pacific Ocean has at certain points surged to six times the normal rate, according to Eric Fisch, US sector head of retail and apparel at HSBC’s corporate banking division.
For now, consumers are shopping anyway: US apparel sales surged 200 percent year-over-year in May, the best-performing retail category, according to the Census Bureau. One recent report from Bank of America found clothing sales are up 35 percent compared to 2019 levels.
Still, consumers are fickle. Apparel sales were stagnant before the pandemic, and the rush to restock wardrobes could quickly subside if brands don’t offer shoppers compelling reasons to return to their stores. Retailers offering holdover styles from 2019 are missing out on a golden opportunity not just to cash in on the current shopping frenzy, but to cement customers’ loyalty in the years ahead, analysts say.
“Creativity has been stifled in the past year,” said Mathur. “There were brands that didn’t develop a single new item, just different colours of previous styles ... Nobody thought that the business would recover as rapidly as it did.”
A Conservative Approach
When retailers were planning for spring and summer 2021 last fall, their priority was to protect their businesses against an unpredictable crisis. They were blindsided by the pandemic and struggled to drive sales with consumers in lockdown. Multi-brand retailers were also cutting back, forcing brands dependent on wholesale to scale back their ambitions.
“The world was a very different place back then,” Mathur said. “Many brands saw budget cuts in the range of 30 percent to 70 percent from key [wholesale] partners. And so a lot of them approached [new] seasons from a perspective of, ‘Okay, we need to protect ourselves.’”
Many brands mined their archives, releasing past hits with a few details tweaked, hence the ubiquity of slip dresses, versatile knitwear, floral prints, ruffles and other styles that call back to 2019 and earlier.
Intermix was also not able to offer as many exclusive items as it had in past seasons. Mathur said typically 30 percent of products are only sold at the retailer. But this summer it’s closer to 20 percent, in part because buyers weren’t able to view new collections in person, and it was difficult to identify standout styles on Zoom calls.
“There is a certain deja vu when trends like the ’70s, for example, continue to be reworked season-on-season,” Edited analyst Kayla Marci said in an email interview. “Fashion’s ongoing obsession with nostalgia sees designers and retailers alike constantly dipping into the archives and modernising relics from the past to make them more palatable to today’s consumer.”
‘Ongoing Shipping Crisis’
While fewer styles and lighter inventory should result in better margins for retailers, that’s only true if they can get the clothes to their stores and warehouses.
As e-commerce surges, backups at American ports are reaching unprecedented levels and shortages are disrupting nearly every segment of the supply chain, from shipping containers, carrier options including FedEx and UPS, and trucking labour.
Last month, the American Apparel & Footwear Association sent a letter to President Joe Biden urging the White House to help “ease the crisis” by facilitating an organised negotiation among logistics players and reduce overall supply chain costs by removing tariffs.
“Our industry is experiencing whopping increases in freight costs and historic shipping delays, which are already affecting the critically important back-to-school and holiday shopping seasons,” Steve Lamar, president and chief executive of the AAFA said in a statement.
The Biden administration announced an executive order on July 8 that addressed some of these challenges by asking various transportation agencies to create more competition in the rail and ocean freight space.
Fisch said most of his clients have seen an uptick in sales but because of this rise in demand, the process of shipping products has become a nightmare. “Everything is delayed across the board,” he said, and that’s not to mention the sky-high costs involved. Brands are now asking their retail partners to chip in on those costs, he added.
Consumers are beginning to shoulder some of the burden, too. In May, apparel prices rose 5.6 percent on a 12-month basis, according to the US Bureau of Labor Statistics, compared with a five percent increase for all goods. It was the biggest monthly increase since 1991. Retail analyst Gabriella Santaniello said she has observed far fewer sales this year too, as retailers planned leaner, lighter inventory levels during the pandemic.
A Return to Newness
The dearth of new styles may be short-lived. Fall inventory will soon hit the shelves, and already offerings will feel more “forward,” Mathur said, with “more tailored clothing.” And despite challenges in logistics, retail cargo imports are at an all-time high, according to National Retail Federation’s Global Port Tracker.
Sexier assortments may also gain ground as the year goes on, according to Marci.
“The sexy dressing trend has been a refreshing palate cleanser,” she said. “Pelvic cut-outs, halo pants, and asymmetric shoulders are all hitting mass retailers and consumers are responding, having been robbed of a party season in 2020.”
And as for resort fashion, which will hit racks in October, merchants like Mathur have returned to buying in person.
“Everyone has seen how strong the business has come back and as a result, they are aggressively going after Q4, with novelty, emotion and [new trends],” she said. “We all feel really confident.”