Profit is the focus this week. Profit is important in the fashion industry for a variety of reasons. One of which is that it allows for a cycle of growth – a process in which things constantly improve. Profitability allows fashion firms to invest in high-quality materials and skilled craftsmanship. This results in better products that are more long-lasting, appealing, and satisfy the expectations of the audience, resulting in more profit, which is then reinvested back into the firm and product to attract more customers and create more profit.

In 2022, the revenue of the apparel market in the UK was estimated to be 58.5 billion British pounds, less than in the previous year. However, the market is projected to recover, eventually reaching more than 75 billion British pounds by 2026 (Smith, 2023). The global pandemic, Covid-19, had a severe impact on the fashion sector, affecting numerous aspects of the firm, which caused its demise in 2022. According to Euromonitor the global apparel and footwear market size shrunk in 2020 by -18.1% (to $1.45 trillion), while McKinsey states that the fashion and apparel industry suffered a 20% decline in revenues for the 2019-2020 fiscal year (FashionUnited, 2023) (McKinsey, 2022). The pandemic caused supply chains to be interrupted, with lockdowns and shutdowns of factories causing delays in both production and product distribution. Similarly, as a result of economic instability and job losses, many consumers limited their spending power, resulting in lower sales for numerous fashion brands and store closures – an estimated 17,145 retail stores in UK closed throughout 2022 (Statista, 2023). 

Various sectors of the fashion industry are currently recovering from Covid-19. Many areas saw a modest recovery in sales when lockdown limitations were eased. Even though physical stores have reopened, e-commerce will remain a key growth sector, as many consumers became acclimated to online purchasing during the pandemic and continued to do so even when physical stores reopened. Furthermore, the pandemic raised consumer awareness of sustainability, which remained a motivating element in purchase decisions (Deloitte, n.d.). As a result, brands with strong sustainability credentials remained in high demand. 

To remain competitive in uncertain economic times, brands must be adaptable and focus on satisfying changing consumer needs. A brand, for example, may continuously collect and analyse data on consumer preferences and behaviours. This aids in recognising changing consumer preferences and modifying products or services accordingly. It is also critical to embrace digital transformation. Use technology to improve the brand’s internet presence and e-commerce skills. Covid-19 is an example of an uncertain economic time, and Peloton is an example of a brand that thrived during this period. With many gyms temporarily closed owing to lockdowns, demand for at-home workout alternatives increased. As a result, Peloton’s connected equipment and live-streamed sessions suited to this expanding trend. Thus, Peloton experienced significant growth during the pandemic due to their ability being able to adapt to changing circumstances. 

Creative directors are essential in the fashion business as they balance creativity and commercial viability. Understanding the brand’s identity and audience is one method creative directors bridge the gap between creativity and commerce. Creative directors intimately understand the brand’s target audience and the market in which it operates. This understanding influences their creative choices, ensuring that their designs are appealing to consumers. Today’s most visible examples of art and business overlap admirably, but they also survive due to a simple fit between the brand’s audience and the artwork. Burberry and British music groups, for example, benefit from a shared sense of national style (Ahmed, 2013). As a result, creative directors play an important role in ensuring that fashion designs not only attract audiences but also contribute to the brand’s financial success by efficiently integrating their creative vision with a strong awareness of the market and brand objectives.

Bibliography

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FashionUnited, 2023. Global Fashion Industry Statistics. [Online] 
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McKinsey, 2022. State of Fashion 2022: An uneven recovery and new frontiers. [Online] 
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McKinsey, 2023. State of Fashion 2022: An uneven recovery and new frontiers. [Online] 
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Smith, P., 2023. Apparel market in the United Kingdom (UK) – statistics & facts. [Online] 
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[Accessed 21 October 2023].

Statista, 2023. Number of retail store closures in the United Kingdom from 2018 to 2022. [Online] 
Available at: https://www.statista.com/statistics/1356731/retail-store-closures-uk/#:~:text=An%20estimated%2017%2C145%20retail%20stores,during%20which%2011%2C459%20stores%20closed.
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