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Copenhagen Fashion Week has been selected as one of the 30 semi-finalists of the 2020 European Social Innovation Competition (EUSIC): Reimagine Fashion among over 760 entries from all over Europe. Copenhagen Fashion Week, with fashion brands and companies, strives towards making substantial changes to the way the event is executed.
Copenhagen Fashion Week has been selected for its plans to reinvent the event by introducing minimum sustainability requirements for any brand wishing to participate - thereby transitioning from being a traditional fashion week to becoming a platform for industry change, according to a press release on the show.
The EUSIC is a challenge prize run by the European Commission across all EU member states and Horizon 2020 associated countries. Now, in its eighth year, the competition acts as a beacon for social innovators in Europe - employing a proven methodology for supporting early-stage ideas and facilitating the emerging of a network of radical innovators shaping our society for the better.
Gap Inc has launched Gap Teen, a collection of apparels for its Gen Z girls. Focusing on denim, the collection offers a range of hoodies, shorts, tops, skirts and more, all made using processes that "save water and reduce waste," Gap said, tapping Gen Z consumer interest in sustainable products.
Select pieces from the debut collection are made with 100 per cent organically grown cotton and Lenzing EcoVero, a fiber made using pulp from renewable wood sources. Others are made as part of Gap's 'Washwell Program' that uses at least 20% less water than conventional wash methods. Meanwhile, some items are made in a factory that runs the Gap Inc. P.A.C.E. (Personal Advancement & Career Enhancement) program, the company's educational program that helps women workers develop new skills to advance in work and life.
This week, Gap parent company Gap Inc also delved into new categories by appointing IMG as its first-ever exclusive multi-brand licensing representative. In late April, the company suspended rent payments for stores that have been temporarily closed in response to the Covid-19 pandemic, and warned that it may not survive the next 12 months, as coronavirus shutdowns wreak havoc on the retail world.
By comparing performance from 2014 to 2019 in the industry’s eight most important sustainability areas, the Australian Cotton Sustainability Report 2019 also highlights areas the industry can do better in, such as the need to make greater efforts to reduce carbon emissions, improve nitrogen use efficiency, increase on-farm carbon sequestration in soil and native vegetation, and improve farm safety.
The 2019 Australian Cotton Sustainability Report is part of the industry’s new Planet, People, Paddock, sustainability framework which guides the industry to set ambitious targets, coordinate a whole-of-industry strategy to achieve these targets, and engage effectively with stakeholders on actions and progress.
Cotton Research and Development Corporation General Manager, R & D Investment, Allan Williams says data from the report can be used to set five-year targets for 2024 and 2029, and plans to achieve those targets. The industry can point to long-term trends of significant improvement in areas it has focused on in the past, and we will draw on this experience to transform our performance in other areas in the future
In the first quarter of 2020, the revenue of the Lenzing Group declined by 16.7 percent in comparison with the prior-year quarter and amounted to EUR 466.3 million. The main reason was the development of prices for standard viscose and other standard fibers. The impact of the COVID-19 crisis further increased pressure on prices and volumes. The prices for standard viscose dropped to a new all-time low of 9,150 RMB/tonne by March 31 – up to 33 percent lower than in the prior-year quarter.
The comparatively positive development of the specialty fiber business and slightly higher demand for fibers in the medical and hygiene segments partially offset the decline in revenue. The share of specialty fibers increased from 47.3 percent in the first quarter of the previous year to 60.9 percent. The earnings development reflects the decline in revenue: EBITDA (earnings before interest, tax, depreciation and amortisation) decreased by 24.3 percent to EUR 69.6 mn. The EBITDA margin declined from 16.4 percent to 14.9 percent. Net profit for the period was down 58.6 percent to EUR 17.7 mn. Earnings per share amounted to EUR 0.84 compared with EUR 1.65 in the first quarter of the previous year.
Lenzing also implemented two most important long-term investment projects to strengthen internal pulp supply and to increase the share of specialty fibers in line with the sCore TEN corporate strategy is progressing according to plan. After the decision to build the dissolving wood pulp plant in Brazil with a capacity of 500,000 tonne, the Duratex Group acquired a 49 percent share in the joint venture LD Celulose as agreed in the first quarter of 2020. Lenzing holds 51 percent of the shares.
In the first quarter of 2020, Lenzing completed the second pilot production plant for its TENCEL™ Luxe branded filament yarn. The new facility at the Lenzing site with a total investment of EUR 30 mn provides sufficient capacity for the development of commercial programs and further fiber applications.
Akira Kawashima, Senior Director, Japan Fashion Week Organization/Textile Division
“Due to the turmoil caused by COVID-19, global apparel and textile industry has been greatly affected. In Japan, many people are forced to work from home and consequently not only individual workers (including freelancers) but also company employees are frightened of large-scale personnel-cuts. Incomes have reduced to 60 per cent of normal. Amid such a situation, people’s desire for ‘dressing’ is low. This tendency will continue for a while even after COVID-19 is over, which will lead to local small-mid-sized textile companies suffering from lack of funds, as they cannot wait for recovery, causing more bankruptcy and/or voluntary closures.”
How will COVID- 19 impact Japan’s apparel & textile industry’s business in the mid to long term? What is the most critical aspect?
Due to the turmoil caused by COVID-19, global apparel and textile industry has been greatly affected. In Japan, many people are forced to work from home and consequently not only individual workers (including freelancers) but also company employees are frightened of large-scale personnel-cuts. Incomes have reduced to 60 per cent of normal. Amid such a situation, people’s desire for ‘dressing’ is low. This tendency will continue for a while even after COVID-19 is over, which will lead to local small-mid-sized textile companies suffering from lack of funds, as they cannot wait for recovery, causing more bankruptcy and/or voluntary closures.
Obviously, industry may not get back to ‘business as usual’, what according to you will be the key changes and in what areas?
In Japan, textile industry is organized through division of labour. Therefore, once some parts/companies of the supply chain disappear, it will be difficult to produce fabrics under the same conditions like before. The textile regions will be greatly affected due to the closure of some small-mid-sized companies in the region. Definitely, the industry will not recover previous state of business.
Emotional and economic backlash on China, how would that change global supply chains?
Due to the outbreak, the risk of China has become clear once again. However, since there are no other countries that possess big market with well-developed production infrastructures like them, it is most likely China’s superiority will remain unchanged even after COVID-19 ends. In terms of products such as uniforms, however, it seems certain that more production will shift to ASEAN countries instead of China via trading firms.
What is the impact on upstream/downstream across the supply chain and on retail and above all what are the changes in consumer behavior?
Working ways of people will be reviewed; working style (work from/at home) will be normalized due to COVID-19, and there will be more tele-working/remote working even after the pandemic ends. Consequently, the occasion to go out will reduce and people will be less conscious of how they look, which will be a tremendous disadvantage for the fashion industry. Consumer activities will increasingly focus on online shopping, which will considerably diminish the need for real stores/shops. There will be clearer products uploaded on websites, which will be an unfavorable situation for Japanese fabrics whose specialty is ‘delicate and nuanced texture’ therefore, demand will fall. After COVID-19, people’s desire will mainly shift to travelling, sports with companions, eating out with friends/acquaintances etc, also equally important will be ‘how to spend a comfortable and pleasant life at home’. In that regard, an interior-field is promising probably some local textile makers/companies might shift from making fashion textile products to interior applications.
What is your advice, how should companies face the future?
In the beginning of 1990’s, the scale of Japanese apparel market was the largest, double the size of the US. It was partly due to the bubble economy, but it was clearly abnormal even in comparison with the US population. At that time, most Japanese apparel/textile companies with big domestic markets used to concentrate only on domestic competition, without aspiring for exports. Although domestic market has slowed down over the years, taking a long time view, the change after this COVID-19 will occur instantly and dramatically. Therefore, only companies that ride the wave with a positive attitude will survive, while the passive ones will not.
Kering has issued a dual-tranche bond for a total of EUR 1.2 billion, consisting of a EUR 600 million tranche with a 3 year maturity and a 0.25 per cent coupon and of a EUR 600 million tranche with an 8 year maturity and a 0.75 per cent coupon.
This issue, in line with the Group’s active liquidity management, enables Kering to diversify its sources of financing and to enhance its funding flexibility through refinancing of existing debt and extension of their average maturity.
The great success of this issue with investors confirms the confidence of the market in the creditworthiness of the Group. Kering’s long-term debt is rated “A-” with a stable outlook by Standard & Poor's. The placement is managed Crédit Agricole CIB, HSBC, BNP Paribas, Natixis, Société Générale, UniCredit and Mitsubishi UFG.
The pandemic has hugely impacted the luxury fashion industry. Brands that produced perfumes and scarves are now making hand sanitizers and masks. Luxury brands like Ralph Lauren & Louis Vuitton are making hospital gowns to be donated to frontline medical workers.
Therefore, luxury fashion sales in the first quarter of 2020, is predicted to decline by around 25 per cent year-on-year basis. Even before the start of the pandemic, China was already witnessing a decline in luxury sales. The outbreak further accelerated this decline in their key operations.
Post COVID 19, the luxury sector in China is likely to witness a seismic transformation. Transforming their business model will be a factor for brands to drive growth. However, prioritising a few key areas of their businesses will help them to mitigate the impact of the virus crisis.
Digital fashion to be the core
Post COVID -19, ecommerce will gain more importance as every brand will put digital at the centre of their operating model. They will shift to an
omnichannel strategy by converging in-store and online experiences. These brands will have to create a digital personalised experience online by either investing in ecommerce, partnering luxury e-tailers like Nordstrom & Farfetch, digitising their entire supply chain, automating operations, and adopting rental as a new revenue stream.
Some key drivers of the next industrial revolution in luxury fashion will be: leading edge technologies like augmented reality and artificial intelligence. With countries across the world imposing travel restrictions and social distancing, technologies like prototyping and sampling via 3D printing, augmented reality enabled beauty cams and virtual try on room will be the next-big-thing in digital fashion.
Brands to aim for sustainability
Consumers will look for lasting investment pieces that will force brands to be more conservative, responsible and slow on production, focusing quality over quantity. Responsible consumerism will be the new norm. For such consumers, brands will try to create timeless designs, sustainable materials, local craftsmanship, slow production cycles, fair wage for workers, reducing carbon footprints across the entire supply chain.
Strategies for marketing post pandemic
Some strategies that luxury brands will need to adopt post pandemic include: Being transparent: Post COVID 8819, brands will have to be real and start communicating with their consumers. They will have to bring out their brand’s ethics along with aesthetics.
Providing virtual experiences: Another strategy that brands will have to adopt is to provide consumers with a virtual experience. They will have to partner with streaming/broadcasting services to create interesting content. For instance, H&M partnered Netflix to promote a new collection, inspired by the teenage romantic comedy “To all the boys I’ve loved before”.
Smart discounting: As consumer spending will decrease, brands will have to offer discounts to increase. Adopting smart discounting strategies will help these brands to cut losses.
Creating attractive content: Another way brands can connect with their consumers is by creating attractive content around their niche market. Rent the Runway recently started a newsletter series on poached egg tutorials and inspirational quotes. Similarly Bonobos is sending satirical blog posts about different types of people in Zoom conference calls. So, break the stereotype and connect with your audience.
Overall, Chinese consumers represent 35 per cent of the global personal luxury goods market. Beyond consumption, Post pandemic, the industry is likely to become more customer-centric, digital and sustainable.
In hundreds of messages expressing concerns and complaints directed at "Turkish Clothing Manufacturer Board’s Coronavirus Help Desk" over the past four weeks, suppliers have drawn attention to some of these alarming actions taken by global brands and retailers:
A large number of brands declared to the manufacturers that there will be no future orders until further notice. This will oblige manufacturers to cover labor and overhead costs on their own for an indeterminate period of time. Some brands called for the suspension of production in the pipeline and yet in some rare cases, solicited discounts or cancellations for goods that are in the pipeline. Lastly, some brands have requested for an extension on the payment terms for shipped goods that are on their way to distribution centers or already in the stores. A halt in high-volume production at the beginning of the season means that large quantity orders are creating massive inventories for the factories. Along with the inventory cost, manufacturers bear full liability for materials nominated by brands on their own, which constitutes an existential threat to companies most of which operate within one-digit margins. If brands do not help their suppliers finance the minimum liabilities, suppliers will not be able pay their employees' salaries and secure their livelihood.
According to the Bostòn Consulting Group, (BCG), the coronavirus crisis is accelerating brands’ sustainability
Often sustainability efforts are additional costs that are not high on brands’ priority lists. Even brands that have been loud and proud about their sustainable practices have been forced to make cuts, like Reformation and Christy Dawn, which have reportedly both scaled back sustainability initiatives this year due to cost. But for some brands, the coronavirus has instead become an opportunity for creative, more sustainable rethinking around how production is done.
For instance, Lafayette 148 has using on-hand material from previous collections that would normally go to waste to create entirely new products.
More than 75 per cent of the brand’s materials and products come from Italy, which has meant a significant amount of order cancellations and delays in production. But from Lafayette 148’s pre-fall material order, the company still had 3,000 yards to work with. Some of those materials were used for samples that never got a full production order or were unused.
Similarly, luxury brand Mark Cross,is in the middle of a similar project. For the brand’s 175th anniversary this year, Mark Cross will release an updated version of the Grace handbag that will be made entirely from reused fabric. Garde Due said the brand, which does all of its manufacturing in Italy, was able to put in a big order for raw materials just before its suppliers shut down in Italy in mid-March, which Garde Due said he’s planning on trying to stretch as far as possible.
Both Smith and Garde Due acknowledged that brands may be tempted to cut sustainability efforts right now, but that it’s not strictly necessary. Mark Cross, for example, has been working with a company called Positive Luxury, a third-party company that advises luxury brands on how to improve sustainability in the supply chain, to ensure that all of its manufacturing and product choices meet environmental standards. Mark Cross has been consulting with Positive Luxury for at least the last two seasons.
Garde Due said that rather than cancelling this partnership to save money, he has deepened it — Mark Cross is working on getting Positive Luxury’s Butterfly Mark, a butterfly symbol the company awards to brands with production that meets a tier of sustainable standards, by increasing the amount of recycled materials it uses. (A number of other luxury brands have received the Butterfly Mark including Dior and Kenzo.) Other luxury brands that have recently made commitments in the name of sustainability include Giorgio Armani, saying he would limit his brand’s collections to only two per year.
Many of the downsides of this crisis have sustainability-related silver linings, like the reduced carbon footprint from limited travel, the requirement of brands to stretch their materials as far as they can go and, in general, and the training of consumers to get used to a world in which both production and consumption is limited.
The May 2020 edition of Cotton This Month states that due to the global economy being paralysed and supply chains shattered, global cotton consumption is projected to decline by 11.8 per cent, reducing global trade to 8.26 million tonnes in 2019/20.
According to the report, while there is hope for a vaccine or cure, or that warmer weather in the Northern Hemisphere will minimise COVID”s impact, there can be no real economic recovery unless there is a health recovery first. Whether or not, we sink into a worldwide depression — a long recession with unemployment reaching as high as 33 per cent — will be determined by the effectiveness of government policies.
In 2020/21, global area is projected to decrease by 4 per cent to 33 million hectares, with India remaining the world leader despite plantings dropping to 12 million hectares. Production will decline by a comparable amount to 25 million tonnes. The Secretariat’s current price projection for the year-end 2019/20 average of the A Index has been revised to 71.4 U.S. cents per pound this month. The price projection for the year-end 2020/21 average of the A Index is 56.9 cents per pound this month.
