movement

Current trends and historical comparisons don’t paint a pretty picture for the fashion industry

The Short Version

The retail sector at large, and the fashion industry specifically, has been having a rough time staying afloat the past two years. While a wave of populism sweeps the US and parts of Europe, fashion labels are beginning to worry that populist politics could gut fashion worse than Germany did during WWII. The comparison is frightening and gives designers more reason to insert politics into fashion.

The Long Cut

Fashion appears to be on the verge of crisis. I mentioned more than once during this past season’s coverage on Pattern that there were several names missing from the schedule, but didn’t take the time to explain why. Let’s do a bit of that now.

BCBG Max Azria has been hurting for a while and confirmed it would be seeking bankruptcy protection March 1. There were announcements that all the stores would be closing as the company shifts its attention to online sales. None of that was terribly surprising, given sales trends for the past few years. However, what did catch people off guard was when Lubov Azria, the long-time creative director, CEO, and wife of founder Max Azria, announced she is stepping down from the company completely. She is being replaced in both the corporate and creative positions by Bernd Kroeber, who has been with the brand since 2007. This announcement is generally viewed as a desperate attempt to revitalize a brand whose look and reputation seems stuck in the 90s.

The last SIBLING runway we covered was the autumn/winter 16 season last year.  The amazingly popular show had erred in not requiring tickets for their presentation and, as a result, a number of editors and buyers were left out in the cold. When September came, we weren’t able to view the show due to scheduling conflicts, but in looking at the pictures we could tell something wasn’t quite right. The death of founding member Joe Bates due to cancer in 2015 was taking its toll.  This season, SIBLING wasn’t on the official London schedule at all (they showed off-schedule). Then, this past Friday (March 10), the label announced they were entering liquidation. Shutting down. Game over. No immediate reason was given.

Then, catching everyone by surprise, THAKOON, the New York-based label backed by Hong Kong investor Vivian Chou, announced that the label is being put “on hold.” This comes less than a month after the label showed its current season collection in New York. While no date has been given for full closure, current inventory is being sold quickly. The reason being given is that the brand’s business model does not line up with the current retail market.  Whether we will ever see another THAKOON collection coming down the runway seems doubtful at this point.

Those are just the latest in a line of recent closures that are punching larger and larger holes in the fashion industry. At the same time, department stores such as Macy’s and Saks are struggling to stay afloat as well. Should the department stores go down, the blow to the fashion industry overall would be tremendous.

Understandably, designers are very nervous. Toss international politics into the fray, though, and designers are downright scared. We saw the application of some of that fear this past season as many designers chose some form of protest, some more obvious than others, during their runway presentations. While outsiders wonder if the rhetoric has any substance, those in the fashion industry see the move toward populism as troubling. Already, the US and UK have populist leaders and designers in both countries are bracing themselves for what might be coming next.

One of the biggest reasons for such concern is that nationalism leads to closed markets and lack of access to the international talent pool on which fashion relies. Already, some 97 percent of all fashion is imported in the US, including the president’s own brand, and those of his daughter. What might be a more important number, however, is realizing that even when clothing is manufactured in the US, much of that work is being done by immigrants, roughly 20 percent of whom are undocumented. Any disruption in either trade or immigration is going to adversely affect the fashion industry and both, at this juncture, seem imminent.

Opening Ceremony’s creative directors Carol Lim and Humberto Leon, both of whom are second-generation immigrants, have never shied away from using their clothing line as means of making a political statement, but since the elections last November have found it all the more critical to be steadfastly aware of the current immigration status not only for themselves but many of the people with whom they work. Most recently, they cooperated with Justin Peck, New York City Ballet’s resident choreographer, in the production of a new piece, The Times Are Racing.  The ballet looks at how the lives of first-generation immigrants affect the lives of their children as they assimilate into the world, a timely topic under most any circumstances. However, between its debut, on a Thursday, and its second performance, on the following Saturday, something changed. The president signed a travel ban leaving thousands stranded at John F. Kennedy and suddenly the protest of the ballet was being mirrored in real life. Dancers, leaping across the stage in t-shirts that read “Act,” “Defy,” “Protest,” “Shout,” and “Change,” were no longer part of what had happened but were now part of what is happening.

The Council of Fashion Designers in America (CFDA), the organization that represents US-based designers, has already been looking at the problems caused by the shift in policies and what might be done to offset the consequences. There don’t seem to be many positive options. CFDA president Diane von Furstenberg, herself a Belgian-born immigrant, said, “The fashion industry has always been a reflection of what America is all about… inclusion and diversity. I am personally horrified to see what is going on.”

New York–based designer Linda Abdalla, who was born in Ireland and raised in Ohio, told Vice magazine, “It even affects the tailors and the seamstresses, and some of the best ones come from countries that are on the banned list. … Having designers and artists coming from those countries, having this ban on people coming to visit, or study, or work for these brands is a big deal. I just started meeting more African designers who are coming to the states, but this is just another block.”

Even in France, National Front leader Marine Le Pen is leading in polls ahead of April-May elections and has said she will push for the country to leave the European Union and close France’s borders, which would be crippling to the Parisian fashion industry, one of the most influential in the world. France’s current minister of culture, Audrey Azoulay, told the Associated Press, “populist powers” are “absolutely incompatible with the idea of fashion and freedom.”

One of the reasons fashion designers and CEOs are so alarmed is because they or their predecessors have seen this before. Many fashion houses, especially those in Europe, are well over 100 years old, some of them, such as Pringle of Scotland, more than 200 years old. Embedded in those fashion catalogs are the evidence of how international politics and upheaval affect the fashion industry.

Consider the fact that we no longer look to Germany as a fashion power. Yet, prior to the rise of Adolf Hitler in that country, Berlin was just as much a fashion capital as Paris or Milan. What happened? At its peak, Germany was home to approximately 2,400 Jewish-owned clothing labels and garment manufacturers. Between 1933 and 1938, all of those companies disappeared because of one person’s severe anti-immigration stance. Imports were forbidden. Exports completely dried up. The fashion industry in Germany died.

Some of the effects of the populist politics from that era still persist. The “Made it Italy” label sewn into garments from Armani to Gucci to Fendi started under Mussolini in an effort to convince Italian women to stop buying their dresses from Paris. While the label is seen today as more of a marketing tool, the nationalistic purpose has never gone away and Italy is still more closed to immigrant designers and foreign textiles than are other countries.

Fashion is a globally dependent industry, reliant on the international travel of both people and material in order to survive. Designers such as Calvin Klein’s Raf Simons regularly travel back and forth between New York and Europe and around the world not only for inspiration for their collections but to discover new fabrics and textile technologies. When politicians begin cutting off access to the global market, either through import/export taxes or through travel bans of any kind, they drive a knife deep into the heart of the fashion industry.

Most reliant on the free flow of textiles are the “fast fashion” retailers such as H&M and Forever 21 whose low prices are dependent upon garments manufactured at the lowest possible prices, usually in places such as Turkey and Bangladesh. Were imports from those countries to see a new tax of 25 percent or more, as has been suggested by the US administration, fashion retailers across the board, from Macy’s to Wal-Mart would feel the negative effect. Stores would have little choice but to pass the increased costs on to the consumers, resulting in an unprecedented amount of inflation. Eliminate those imports entirely and H&M and its competitors would have little choice but to close. Completely.

The rhetoric of populist politics always sounds good on the surface. “Make America Great.” “America first.” “Buy American.” Yet, history has proven that such nationalism and the fashion industry don’t mix. Fashion has to be open. Fashion, as an industry, must move as freely as a summer dress. There can be no borders. There can be no domestic restrictions. Try to put fashion in a box, even if it is flag-draped, and not only will an industry die, but the economies dependent upon that industry will be crippled.

Fortunately, designers are not the kind of people likely to just slip quietly away. As we saw this past season, they intend to speak up, to use their voices not just on the runway but on store shelves and even on the bodies of their customers to express opposition.

Larger groups are getting in on the action as well because bad laws that affect one sector affect them all. To that end, the National Retail Federation (NRF) released this ad last month in opposition to what’s being called a “border adjustment tax.”

The NRF has a strong lobbying presence in the US Congress and is working against any new legislation that would be of any detriment to the already struggling retail sector.

Now, let’s bring the matter home.

Consider what you are wearing right now. Assuming the clothes were not a gift, how much did you pay for them? $10? $100? Maybe $350 for the whole outfit, including the shoes. Americans are notorious bargain shoppers and hate paying full price for anything (which is a problem unto itself). So, what happens if a 25% tax is pushed on to the customer. The actual price increase is going to be closer to 30% to cover additional administration in filing the tax. So, that $10 item is now $13. Doesn’t seem like much. The $100 dress is now $130, which still doesn’t sound like a horrible increase unless you’re on a budget, in which case crossing that $100 line may not be possible. That $350 outfit though is closer to $450, and if you’re someone who likes designer labels in your clothes that 30 percent adds up even faster.

Oh wait, we’re not done. You can’t wear just one outfit every day (though I know some who would try). Consider how much you spend on clothes for your family each year. The kids’ school uniforms. The shoes (almost none of which are made in the US). The underwear (almost all of which is imported). Can you really afford a 30=50 percent increase in your clothing budget on top of all the other prices that are increasing along with it?

If you’re part of the one percent of the US population that makes over $521,411 a year, you might not be too concerned. The rest of us, however, have every reason to worry.

Populist politics, from nationalistic protectionism to anti-immigration restrictions and overly protective import tariffs are not only bad for the fashion industry, they are equally bad for your life, your children’s lives, and your future.

You might want to consider contacting your members of Congress now.