Major crises like the current pandemic have been causing havoc in the fashion industry. This has affected everything from end-user consumption to manufacturing and distribution. Millions of people are employed by department store chains, clothing retailers, and cosmetics stores. Leaders in the industry should always act quickly when it comes to business recovery strategies.
During the crisis, garment and fashion companies have already put their assets to good use. Whether it’s by donating products and services to healthcare workers or assisting employees in finding temporary jobs with companies that are hiring. It is critical to ensure that the company can survive and thrive in the aftermath of an unprecedented shock.
We have identified some of the best business recovery strategies that fashion companies should consider implementing in order to survive in any difficult environment. This includes digitizing supply chains as well as increased cross-brand collaboration.
Take a look at the following:
The pandemic forced companies throughout the fashion value chain to reconsider their current operations. COVID-19 has hastened the transition to digital in the distribution chain via e-commerce. Well, the fashion industry is no exception.
Prior to the pandemic, online clothing sales were already skyrocketing. Global online sales, including sales tax and in constant value terms, increased by 125%. It happened between 2014 and 2019.
Consumers of all generations will have been forced to take the digital plunge in the aftermath of the crises. Many people who were previously hesitant to purchase online are now becoming accustomed to it as a method of shopping and engaging with brands.
E-commerce sales are expected to increase by 24% in 2021 alone. Smaller retailers and brands are now using free tools like Facebook Shops to sell their products on both Facebook and Instagram. Many reputable oem jackets sellers and upcoming winter apparel selling brands have taken their business online without any hesitation. Why can’t you?
2) Transparent Global Supply Chains
As we move away from pandemic-related shutdowns and disruptions, each player in the global supply chain must take a deep dive. It is important to ensure transparency throughout the chain.
It is not sufficient for the enterprise global sourcing professional to have visibility into their immediate level of supply. In short, they must also gain visibility into the entire chain, beyond tier-1 suppliers. But before you understand this important strategy, it is important to get acknowledged about what is supplier sourcing?
In the case of apparel manufacturing, the value chain is particularly extensive. It extends from fiber and yarn to fabric and textiles and, finally, apparel and fashion. As a result, supply chains have multiple tiers. Businesses must understand who their suppliers are, where they are located, where they source from, their risk exposure, and so on.
For example, the US can reduce its trade over-dependence on a single Asian country by sourcing within or nearshoring. But at the same time, if suppliers rely on raw materials and intermediaries in the same cluster or country, disruptions are likely to reoccur.
3) Mergers & Acquisitions
The year 2020 was difficult for many, with several brands disappearing as a result of temporary store closures, as well as putting pressure on retailers. Once the dust settled, we expected a wave of M&A and private equity activity.
Large companies with cash looked horizontally to take over direct competitors who have been left vulnerable by the crisis. While players may also look vertically within the supply chain. In Europe, we’ve already seen signs of activity, with French Connection-owned French fashion brand Naf being purchased by its Turkish supplier.
Businesses will need to work together effectively to address the unusual issues and complications that will arise as a result of any crisis. Some of the most significant benefits of collaboration include the ability to save money, solve problems, share knowledge, and expand networks.
In June 2020, British designers Halpern, Liam Hodges, Mulberry, RAEBURN, Julien Macdonald, and RIXO joined forces to launch non-medical charity face masks. Fashion retailers could learn from the food retail industry as well.
During the lockdown in Germany, for example, Aldi collaborated with Germany’s McDonald’s, with McDonald’s sending workers to Aldi to meet the high demand.
5) Continue Full-Funnel Marketing
In tough business times, it’s easy to assume that all B2B purchasing functions have been halted, but this isn’t always the case. Some businesses are moving through the purchasing stage faster than usual. To the international buyer community, target “categories of immediate need.”
Gain trust by focusing on international quality certified products and sellers. Companies are still willing to buy, but it may take a different form than usual. Continue to have sales teams follow up on leads and use retargeting campaigns to influence their purchasing decisions.
6) Customer Communication
Whatever you do, make sure you communicate proper expectations to your customers at each stage of the buyer funnel. Be specific about what they can expect from you in terms of follow-up.
7) Service as a Product
Finally, as the fashion industry adjusts to social distancing, we can expect to see an increase in the personal shopping experience. More particularly at the premium end. This will allow brands to connect with their customers on a more personal level and better understand their needs. While the customer will benefit from a great personalized experience.
One of the popular UK retailers has launched a free virtual personal shopping service. This service allows customers to receive the same product advice they would receive in a department store without leaving their homes.
Gucci, an Italian luxury brand, is also banking on personalized video consultations to boost sales. Gucci Live, its own video service, was launched in the previous year.
There’s no disputing that business crises, or any other severe disaster such as a pandemic, will make it tough for your apparel company to develop. Even survival can be difficult for some businesses.
However, if apparel and fashion companies lead with compassion and take bold actions, they will be able to not only weather the crisis but also emerge stronger.
We hope the strategies listed above are useful to you during your difficult times!