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.
Yesterday, Beijing put into effect an export control law allowing it to block shipments heading abroad for national security reasons.
Beijing has yet to provide details on what products and companies will fall within the new restrictions. But the move — a counterattack on US sanctions — threatens to disrupt supply chains for foreign businesses reliant on Chinese manufacturing. Businesses are concerned that the new rules will be used as a tool in the ongoing trade war.
For sectors including apparel and footwear, the new law will likely accelerate the current offshoring of Chinese manufacturing to Southeast Asian markets like Vietnam and Cambodia, where labour costs are much cheaper. How exactly this plays out for brands outside China will depend on how Joe Biden manages US-China trade relations and whether he follows in the footsteps of predecessor Donald Trump.
With consumers tightening their belts in China, the battle between global fast fashion brands and local high street giants has intensified.
Investors are bracing for a steep slowdown in luxury sales when luxury companies report their first quarter results, reflecting lacklustre Chinese demand.
The French beauty giant’s two latest deals are part of a wider M&A push by global players to capture a larger slice of the China market, targeting buzzy high-end brands that offer products with distinctive Chinese elements.
Post-Covid spend by US tourists in Europe has surged past 2019 levels. Chinese travellers, by contrast, have largely favoured domestic and regional destinations like Hong Kong, Singapore and Japan.