The year 2020 will go down in history. The coronavirus pandemic is changing the world and the fashion industry has not escaped unscathed. The report The State of Fashion 2021 by management and strategy consulting firm McKinsey & Company and the British fashion and media enterprise The Business of Fashion focuses on what the industry will need to address in 2021, including shifts in consumer behaviour, problems along the supply chains and lower revenues. While the fashion industry's total economic profits increased by approx. 4 per cent from 2018 to 2019, the report's authors forecast a sharp drop of approx. 93 per cent in 2020. However, despite the negative impacts of the pandemic, there are also grounds for optimism. The crisis is accelerating change and, as such, holds promise. Numerous companies have used the past months to restructure their business models, improve their processes and refine their customer profiles.
What lies ahead for the fashion industry? McKinsey & Company and The Business of Fashion outline two possible future scenarios: The first, more optimistic "Earlier Recovery" scenario is predicated on successful virus containment and a relatively rapid economic recovery. It envisages that fashion sales in 2021will fall by no more than 5 per cent compared to 2019. In concrete terms, the industry would therefore return to 2019 levels of activity in the third quarter of 2022. The second, "Later Recovery" scenario sees sales levels drop by 10 to 15 per cent in 2021 compared to 2019. In this case, sales would only revert to 2019 levels in the fourth quarter of 2023.
The report's findings demonstrate that the pandemic is changing the global economy, the needs of consumers and the garment and textile industry. Trends towards digitalisation, sustainability and social justice became apparent some time ago, but now more than ever it is evident that industry players must realign, grasp shifts in demand, remain flexible and operationally resilient: sustainability, digital technologies and new buying formats are gaining ground.
Fashion, sustainability, innovation and technology are just a few of the themes of the second digital "Neonyt on Air", which will take place online on Neonyt social media channels from 18–20 January 2021.
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