Is fast-fashion slowing down?
Recent stumbles from key fast-fashion players have some wondering whether the fast-turn, disposable trend has hit a speedbump.
Among the reports:
- Uniqlo has quietly closed five stores since January amid financial challenges;
- H&M’s sales rose more slowly than expected in its most recent quarter. Investors are concerned that its 10 to 15 percent expansion rate is leading to cannibalization;
- Forever 21 has slowed expansion and closed some of its largest stores as a bankruptcy of a key supplier pointed to a steep drop in sales for the teen chain.
It’s tough to gauge the health of the trend with overall apparel retailing in the doldrums, hurt by mild weather over the holiday season, heightened online competition, a shift in spending toward eating out and vacations, and other factors. Zara also continues to do well, perhaps due to its higher-end positioning. But the fact that a few fast-fashion chains are slowing their growth may mean that they expanded faster than warranted. Fast-fashion may also be largely suitable for major cities given that all of Uniqlo’s closings focused on suburbia.
The bigger question is whether the business model — tied to frequent, smaller deliveries of runway knockoffs — has some kinks. The Wall Street Journal said H&M’s localized model, for instance, forces the company to “rapidly open stores in new markets to justify the cost of local distribution centers, merchandising and property teams and other infrastructure it opens in every market.”
The trend also runs counter to the sustainability and better-quality trend being championed in food and other sectors. Some question how the cheap items can be made ethically and rage against the eco-damage of such throwaway items.
“It comes back to how delightfully cheap everything is,” Abigail Glaum-Lathbury, assistant professor of fashion design at the School of the Art Institute of Chicago, told the Chicago Tribune last November on fast-fashions’s allure. “If something is $5, there’s no downside, but that is a problem on another level. That kind of mentality, that’s not how we treat people and our friends and that’s not how we should treat the environment and our limited resources, especially in the face of global warming.”
- Are We Officially Burned Out on Fast Fashion? – Esquire
- Uniqlo’s struggles cause fashion chain to close stores – New York Post
- Fast-Fashion Leader Keeps H&M at Bay – Dow Jones Businesswire
- Forever 21 Rethinks Its Love of Giant Stores – Forever 21
- Fast-fashion’s rapid growth starts to slow – CNBC
- Is fast fashion at odds with sustainability? – PYMNTS
- Zara Owner Inditex Stays Ahead of the Competition – The Wall Street Journal (sub. required)
DISCUSSION QUESTIONS: How do you explain the recent struggles that fast-fashion chains are having? Do you still see fast-fashion making gains against the traditional apparel model in the years ahead?