Has Greed Killed the Fashion Industry?
From The Huffington Post:
Fashion, it seems, has gone out of fashion. Companies are reporting record losses for the first half of 2009, several are filing bankruptcy — the most high profile being the French couture house of Christian Lacroix, and fashion magazines are in a panic over the drop in ad page sales.
So Diane von Furstenberg, the president of the Council of Fashion Designers of America, held a summit of sorts in New York last week with leaders of the industry, including Vogue editor Anna Wintour, to rethink Fashion Week, the semi-annual trade-show-like event to present new offerings and drum up hype. Instead, the meeting turned into a strategy session to figure out how to stop plummeting sales and profits during the current economic recession.
There were several conclusions. Von Furstenberg argued that the period between the fashion shows and when the clothes reach the stores was too long and wants to reform the show system. Fashion designer Donna Karan declared that the practice of early delivery to retailers was the problem. Who wants to by a bikini in March or a mink in July? As a result, Karan said, consumers wait until sales to shop, and companies and retailers lose the huge mark-up that equals bigger profits. Wintour suggested following the French model of having a government-fixed day when retailers can start price reductions, but this was quickly shot down as price-fixing and illegal in the United States. “Is that something we can change?” asked Wintour. “We have friends in the White House now!”
Finally, von Furstenberg addressed the elephant in the room: “Everyone had been too greedy,” she said, “and everyone thought the party was forever.”
The article by Dana Thomas (the author of Deluxe: How Luxury Lost Its Luster goes on to describe the transition of the major design houses from family businesses to conglomerates, as well as the decline in production quality (but not garment prices).
A lot of her criticisms leveled at the fashion industry are fair; however, to say that greed dictates the fashion industry as a whole is inaccurate. Plenty of mom-and-pop boutiques (my own included) have gone out of business in the last two years because they simply couldn’t afford to sell things at or below cost in a sluggish economy anymore. It would seem that government legislation and stringent pricing guidelines set by showrooms and designers are necessary to both reform and keep the fashion industry afloat.
