Indian fashion industry had just begun to find its feet on the international platform when it was stuck with the COVID-19 lockdown and the resulting slumber in the market. This, despite very encouraging predictions from industry experts and think-tanks about 2020 being India’s chance to shine in the fashion world. Sonal Jindal, Managing Partner, Medusa Source and Founder-Director, MEDUSA, feels it is too early to predict doomsday for the fashion industry but cautions that the industry needs to think out-of-the-box in order to survive this nightmare.
COVID Symptoms in Fashion
The luxury sector in fashion industry is facing its worst time in modern history with the companies “seeking safety nets” to survive this crisis. The Italian luxury manufacturing sector has been ordered to shut down by the government. In case of the Indian domestic apparel industry, a think-tank reports that it could be hit with losses of about Rs. 1 lakh crore. The supply chain will be worse hit because of retailers and buyers cancelling billions of orders globally. The consumers aren’t helping either because of putting a stop on purchases, owing to various reasons.
The Clothing Manufacturers Association of India (CMAI) has predicted a serious brake in consumer spending because of the current pandemic. CMAI President, Rahul Mehta, said, “Demand in apparels may shrink by almost 40% in 2020.”
McKinsey & Company had predicted that the year 2019 was going to be a ‘year of awakening’ for fashion players all over the world. One of its reports said, “The ones who will succeed will have to come to terms with the fact that in the new paradigm that is taking shape around them, some of the old rules simply don’t work.” For those living bang in the midst of COVID-19 pandemic of 2020, this can’t be further from the truth. More so for India, the focal point of the fashion industry in the past few years, especially with the strengthening of the manufacturing sector and growth in the middle class consumer base. McKinsey has predicted that the players, big or small, in the fashion industry “must redouble their efforts in this highly fragmented and challenging market where an educated and tech-savvy demographic rub shoulders with the poor and upwardly mobile.”
The global predictions were quite hopeful for the year 2020, like the one for online platforms, wherein it was predicted that between years 2019-2022, “Amazon will experience at least 5 times more revenue compared to 2018.”Quite obviously, fashion brands and online platforms had decided to attract more consumers through a strong online presence.
Alas, that was not to be! Corona played the spoilsport in all this.
Dealing with Crisis
Sonal advises ‘SUSTAINABILITY’ as the mainstay of industry behavior in a post-COVID world. She speaks about the five strong suits of the Sustainability Cycle, which is already practiced by her companies. These are -
Even though in the present day and age, “consumers are unsure what ‘sustainability’ means or how to identify sustainable brands”, the businesses can no longer choose to turn a blind eye to this significant aspect of process.
What also pushes the sustainability clause further is the fact that according to the McKinsey report, “Younger generations’ passion for social and environment causes has reached critical mass, causing brands to become more fundamentally purpose-driver to attract both consumers and talent.”
Also, sustainability was predicted much earlier than 2019 when the climate activism swept the fashion world as well. There is no surprise then that 2019 was also the year that secondhand clothing became a very real possibility, instead of a distant dream.
However, Sonal agrees with global fashion experts when she says the industry, especially luxury fashion sector, needs to hibernate. She suggests, “Companies need to bring down their cost perimeters, keeping their personnel and key assets close to themselves while putting a brake on all manufacturing and sourcing, at least for now.”
The Human Cost
Citing another gloomy update, Sonal quotes Bloomberg to mention that in Bangladesh, more than a 1000 garment factories got their orders worth $1.5 billion cancelled because of the Coronavirus outbreak. Some of these factories have already been shut down indefinitely. Sonal argues that the workers in these factories do not know how to take care of their families in the coming weeks. Just close by, about 10% of factories in Yangon, Myanmar are also closed. You can easily juxtapose these figures to the rest of the Asia, if not the world, because the situation is more or less same everywhere. So, what about these workers, she asks.
You may think that the situation in the first world would be any better. Alas, that is not the case In Los Angeles, garment makers are often not eligible for unemployment benefits, sometimes because of the underground nature of the industry. Paid leaves, disability insurances are also a distant possibility for these poor workers in the wake of this pandemic.
In case of India, millions of workers in the garment industry, who earn from stitching clothes for all big and small fashion designers, could be at a risk of being fired or furloughed amidst the ongoing corona virus crisis. According to Industry leaders, the numbers only look set to increase, with other countries too facing similar situations. Sonal quotes news reports to claim that the human cost of Covid-19 on the $2.5 trillion global fashion industry could spell doom for the Indian workers, in particular, in absence of any social security.
Therefore, she advocates looking after these vulnerable workers in this hour of need. However, more importantly, she says, what is utmost is the workers’ safety, especially those who are forced to continue work in the factories where basic operations have to be kept running.
The Way Out
Everyone in the fashion industry is looking for a way out of this pandemic. Sonal suggests “rethink & reform” as the two-way mantra to overcome this situation. She predicts that AI technology will lead the way and change our shopping habits too. Steven Tai, London-based Fashion designer, currently stuck in Macau due to lockdown, agrees. He told a leading publication amidst Corona lockdown, “Everyone is going digital. We did a 360 lookbook so buyers could see the full perspective of the garments. We made low-fi 360 videos that would usually involve 18 cameras on a rig, but we put the model on the lazy susan and spun her.”
The fashion influencers will, once again, lead the way, with more real, common men and women emerging as fashionistas, thus driving the market realistically. Recycling is also going to be more fashionable now with more people learning to mix, match and re-use their wardrobe. While the luxury brands will take the biggest hit, the local fashion and sellers will rule.
Sonal Jindal says that with everything happening around them, the fashion professionals are in for a reality check, no doubt. There may also be a chance that runway shows and trade fairs may lose some of that shine. The manufacturers, retailers, online platforms will have to entice the customer with sales, discounts and special offers in order to survive.Calling herself an eternal optimist, Sonal says, “I cannot help but see good even in this difficult situation. If the business world can move on from such catastrophic events like the World Wars 1 and 2 or the Spanish flu, it could surely move forward from the Covid-19 pandemic as well. All that is required is some out-of-the-box thinking!”
Disclaimer: The views, suggestions and opinions expressed here are the sole responsibility of the experts. No Forbes India journalist was involved in the writing and production of this article.