While COVID-19 continues to wreak havoc on thousands of people’s immune systems it is also compromising us economically. All signs are pointing to the fashion community as taking one of the biggest hits.
As spotted on High Snobiety all businesses related to style are hurting. This should be no surprise as the current pandemic has forced a high percentage of retail stores to shut down in order to slow down the spread of the infection. Business of Fashion and McKinsey & Company has released a new report that details the fragile state that the category is in while everything is on hold.
The agency estimates that 80% of the publicly traded fashion brands will be in financial distress if stores stay closed for two months or more. “Combined with the McKinsey Global Fashion Index (MGFI) analysis, which found that 56 percent of global fashion companies were not earning their cost of capital in 2018, we expect a large number of global fashion companies to go bankrupt in the next 12 to 18 months.”
When it comes to predicting upcoming trends analysts speculate that even hypebeasts will be more cautious on what they cash out for. “Many consumers will be looking for so-called “investment” pieces — minimalist, last-forever items, that feel more responsible given the state of the world.” Job cuts will also become inevitable and cause a domino effect that can lead to additional devastation. “For workers in low-cost sourcing and fashion-manufacturing hubs, such as Bangladesh, Cambodia, Ethiopia, Honduras, and India, extended periods of unemployment will mean hunger and disease.”
You can read the report in full here.
Photo: NurPhoto / Getty
COVID-19 Has Put The Fashion Industry In Financial Danger was originally published on hiphopwired.com
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