Profit
‘Money makes the world go a round’, it is a common phrase, we have all heard it before but why is it relevant this week? A positive cash flow is a fundamental part of a successful business and that is why we will be delving into how it affects fashion firms. Due to the pandemic the fashion industry alongside many others were hit and faced an unexpected decline as a result of ‘high inflation and decreasing consumer confidence’ (Smith, 2023). However, as we have progressed the global apparel market revenue was calculated to be $1.53 trillion and is expected to be over $1.7 trillion in 2023 (Smith, 2023). The highest demanding countries are China and America which isn’t surprising due to their large population yet China’s demand can also be traced back to the growth of the middle class and China’s emerging economy enabling larger amounts of consumer spending and in turn growth of sectors such as the fashion industry. ‘The second-hand apparel industry, which is forecast to grow as the consumer demand for more environmentally conscious apparel options increases. The luxury market is also a key market in the apparel industry; it is projected to more than double in size from 2022 to 2028.’ (Smith, 2023) This demonstrates the switch consumers are making in order to be more sustainable by shopping second hand, therefore highlighting to brands the importance of sustainability as it is one of the fastest growing sectors. As a result, initiatives and steps should be made to invest into these markets by brands as they are the future and in order to survive and ensure a profit they must stay on top of meeting consumer needs. Additionally, the growth of the luxury market further displays the rise of many nations’ middle classes and how countries are in the stages of emerging and developing which enables people to have higher levels of disposable income to spend on brands.
Despite the predicted growth of the luxury market many brands face the problem of becoming obsolete and decline, an example of this is YSL. During the 90s Saint Laurent struggled with his mental health and the brand as a whole was unable to be a pioneer in trends as it had been but instead was just reiterating previous collections and relied heavily on a loyal clientele that were ageing, leading to the brand ageing as well (Mitterfellner, 2023). 2012/13 was the year of the much needed rebranding and repositioning of YSL, a greater focus was placed on getting in touch with younger generations and a brand name change caused a stir helping attract attention. The focus on the Asian market and multi distribution channels helped revitalise the brand and enable them to survive and regain their reputation of being pioneers, demonstrating the success of rebranding (Mitterfellner, 2023).
Economic uncertainty can cause panic and lead to lower consumer spending. In order to survive and maximise profit margins, brands should focus on analysing and innovating, whilst innovation requires large amounts of R&D and costs associated with it, it is vital in our age of rapid technological advancements especially in the manufacturing process as in the long term it can reduce costs. Alongside this brands should focus on convenience. Convenience is always a key customer need as we as humans are lazy by nature, therefore multiple distribution channels and associated ease are likely to enable higher selling prices and in turn profits.

Creative Directors have one of the most significant yet stressful roles within a business and their numerous roles (brand ambassador, designer, manager) result in them leading in bridging the gap between creativity and commerce. Lagerfield was a visionary and directed brands such as Chanel and Fendi alongside his own label. An example of him bridging the gap was one of his most famous installations in Paris where he ‘re created a supermarket, an airport in the middle of Paris’s Grand Palais, had a giant rocket in the room, a block of carved ice, a ginormous lion, desert sand and waterfalls – just to name a few examples’ (Mitterfellner, 2023). Not only creating a buzz around the brand but also thinking out of the box and doing it creatively, therefore creating a long lasting memory and impact. Subsequently, showing the importance of creatives being appointed to showcase the brand’s DNA.
Bibliography
Mitterfellner, O. (2023) Luxury Fashion Brand Management and sustainability: Unifying fashion with sustainability. New York: Routledge. (Accessed: 21 October 2023).
Statista. (2023) Generation Z fashion market in the United Kingdom. Available at: https://www-statista-com.arts.idm.oclc.org/study/139027/generation-z-fashion-market-in-the-united-kingdom/ (Accessed: 21 October 2023).