What: The annual Business of Fashion report giving a hint of what is going on in the fashion industry.

Why it is important: There is no new or surprising topic in the list of challenges that brands will have to face in the coming year. However, such a long-lasting challenging situation widen the gap between superstar brands and the others, which are also part of the ecosystem department stores rely on to survive.

The Business of Fashion produces its annual report giving the “state of fashion” for the coming year 2022. After two years marked by a significant change of conditions due to the worldwide pandemic, BoF identifies that in markets where vaccination rates are high, situation is improving (revenge buying in China and in the US).

However, the magazine also pinpoints the fact that the new conditions have created a growing gap between winner-takes-it-all brands and the rest of the market: while a very small number of brands are already surpassing their pre-pandemic level, most fashion brands are still struggling, especially if they are not able to adapt by selling online, to wealthier customers, products revolving around outdoor and comfort. Such a situation generates an unusually high number of takeovers and bankruptcies, while BoF identifies “supper winner” brands as being either from the Sportswear market, luxury segment or Chinese.

McKinsey estimates that 2021 industry turnover will be either -4% to flat compared to 2019, and 2022 between +3 and +8%, aggregated. However, once again, this hides the fact that some brands will be taking the lion’s share while others will keep on fighting for their life, in a market environment which will remain complex and inconsistent, as all will have to deal with:

• A long-lasting logistic gridlock which will also affect brands and producers all along 2022,
• Consumer shifts (getting local, digital and exploring the metaverse opportunities),
• Industry issues: circularity and CSR, use of technology offensively (product passports and NFTs) and defensively (cyber resilience) and the talent shortage.

Fashion 2022