Many may see the fashion industry as nothing more than a superficial business but it is responsible for almost 900,000 jobs, contributing £28 billion to the UK economy each year.
With 90% of UK designers announcing they voted to remain in the EU, it’s no wonder Brexit has been labelled as the worst thing to happen to the British fashion industry.
As Theresa May triggers Article 50 in a no going back move, the sartorial world is wondering exactly what this significant change will mean for them.
A number of short term benefits were seen straight after the referendum. As the value of the pound dropped to an all-time low, ASOS recorded its biggest sales since the 2015 Black Friday while Burberry reported a huge 30% sales rise thanks to tourists taking advantage of London’s low prices.
However, a significant amount of drawbacks could be on the horizon. The British Fashion Council outlined several areas of concern: trade and investment, talent and skills, and EU funding.
The main impact that will affect the average consumer is a rise in prices. Although luxury goods are now cheaper in the UK than anywhere else, companies may be forced to up their prices to compensate for the weak pound.
High street retailers including Next, M&S and New Look have been hit the hardest by the falling currency due to the majority of their stock being in dollars. In fact, Next has already announced that prices will increase as much as 5% in the next year with experts predicting similar moves by other brands.
All of this economic uncertainty could spell disaster for manufacturing too. The cost of producing and importing clothes is set to jump by a fifth if a hard Brexit goes ahead.
Fashion labels could also face extortionate trade tariffs if the UK fails to come to a suitable trade agreement, again leading to a rise in prices.
Some independent designers have already felt the impact of the referendum vote. Rising costs forced London-based knitwear label Sibling to shutter earlier this month.
One half of the brand, Cozette McCreery, clearly explained the situation Brexit is putting smaller labels in: “We work in an industry with very tight ties and associations with Europe. Many of our suppliers are based in Europe, we sell in Paris, we ship to stores in the EU and beyond, we loan press samples abroad . To us, it made absolutely no sense to vote for leaving.”
“It is making everything more expensive for us with factories and showrooms. One factory owner told me they were concerned [the weak pound] could push design houses into debt and potentially cause closures.”
Menswear designer Patrick Grant agreed, telling the Financial Times: “Most of our goods are made in the UK but almost all these goods have some component that starts outside the UK. The base cloth of our cotton textiles comes from Italy. That cost has gone up. Technical fabrics and zips come from Italy. The snaps and buttons come from Germany. We might sell a few more because the pound is weaker, but virtually every product will get more expensive to manufacture.”
Reports predict that manufacturing may make a return to the UK but with little to no factories, the time needed to kickstart British production may simply be too long.
In a rather brave move, ASOS announced plans to double its UK manufacturing in December. The e-tailer did the complete opposite of British fashion giant Burberry who postponed the building of a new factory in the North.
It’s easy to understand why retailers are reluctant to manufacture (or even attempt to) in Britain. Currently, the majority of raw materials are imported. Certain essential items including zips and denim are not made in the UK with shirts and suits manufacturing being equally non-existent.
Money aside, London’s international reputation as a global fashion hub may also suffer. With fears that London Fashion Week may cease to exist, other institutions (including the BFC and the University of Arts London) are worried about the loss of hundreds of millions in EU funding.
London mayor Sadiq Khan set up the #LondonIsOpen campaign to combat feelings of reluctance, letting the world know that the capital remains open for business and that all are welcome. According to London Fashion Week organisers, it’s working with last season attracting more international interest than any other.
The exact effects Brexit will have on the fashion industry are still unclear. Britain needs the world to remain confident in its retailers in order to avoid economic downturn while continuing to support young talent who will become the industry’s next greatest names.
Let’s hope Theresa May takes fashion into account in her future decisions.
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