Episodes
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The global fashion industry is entering 2025 with a particularly tumultuous and uncertain outlook. According to the latest BoF-McKinsey State of Fashion Executive Survey, 80% of executives expect no improvement in the industry, with 39% anticipating worsening conditions[1][3][5].
The industry's revenue growth is expected to stabilize in the low single digits, a continuation of the sluggishness seen in 2024. This is largely due to consumers becoming increasingly price sensitive following a period of high inflation. The long-feared cyclical slowdown has arrived, and regional differences will become even starker in the coming year[1][3][5].
One of the key shifts in consumer behavior is the rise of "dupes," or affordable alternatives to luxury brands. This trend, combined with the acceleration of climate change and the reshuffling of global trade, means that fashion brands must navigate a complex maze of challenges to find pockets of growth[3][5].
In response to these challenges, fashion leaders are diversifying their sourcing footprint in Asia, particularly in countries other than China. India is expected to be a focus for high-street players, while Japan's luxury boom is expected to continue into 2025[1][5].
Supply chain developments are also a key area of focus. Retailers are accelerating their reconfiguration of supply chains to prioritize nearshoring and manufacturing in geopolitically-aligned countries. This is driven by the need to reduce excess inventory and minimize the risk of shortfalls[1][3].
Regulatory changes are also impacting the industry. Governments around the world are increasing pressure on fashion brands to reduce emissions and fashion waste. This is driving advances in inventory management, with new technology aiding these efforts[1][3].
In terms of market movements, the luxury segment is expected to show more resilience than other categories. However, even luxury brands are not immune to the challenges facing the industry. The McKinsey Global Fashion Index forecasts that non-luxury will drive the entirety of the increase in economic profit for the first time since 2010[3][5].
Overall, the fashion industry is facing a time of reckoning in 2025. Brands must be agile and adaptable to navigate the complex challenges ahead. By diversifying their sourcing footprint, investing in new technology, and prioritizing sustainability, fashion leaders can find pockets of growth in a tumultuous market.
Key statistics:
- 80% of executives expect no improvement in the global fashion industry in 2025[5].
- 39% of executives anticipate worsening conditions in 2025[1][3][5].
- Revenue growth is expected to stabilize in the low single digits in 2025[1][3][5].
- Non-luxury is expected to drive the entirety of the increase in economic profit for the first time since 2010[3][5]. -
The global fashion industry is poised for a transformative yet challenging year in 2025, marked by economic uncertainty, shifting consumer behaviors, and the need to embrace sustainability while navigating complex global trade dynamics.
According to the McKinsey & Company’s State of Fashion 2025 report, the industry faces a long-feared cyclical slowdown, with revenue growth expected to stabilize in the low single digits. This sluggish growth is a continuation of the trends seen in 2024, reflecting economic deceleration and muted consumer confidence[1][3][5].
Key markets such as the United States and Europe are experiencing slow growth, while China’s performance has decelerated significantly. High-net-worth individuals in the US are supporting steady growth, but middle- and lower-income segments are facing challenges[1][3].
Consumer behavior is shifting, with increased price sensitivity due to recent high inflation. The rise of "dupes" and the acceleration of climate change are also influencing consumer preferences. Regional differences are becoming starker, with Europe benefiting from falling inflation and increased tourism, while the US and China face economic uncertainties[1][3][5].
To navigate these challenges, fashion industry stakeholders are advised to diversify sourcing beyond China, enhance sustainability through renewable energy and circular production models, leverage AI and technology for product discovery and supply chain optimization, and target overlooked demographics such as the "Silver Spenders"[1][5].
Supply chain developments are also critical, with retailers accelerating the reconfiguration of supply chains to prioritize nearshoring and manufacturing in geopolitically-aligned countries. This includes efforts to reduce excess inventory and minimize the risk of shortfalls[3][5].
The climate crisis remains a potent force across fashion supply chains and in driving consumer behavior. Leading companies are bolstering their resilience to climate impacts, recognizing that inaction is no longer an option. Extreme climate events are already placing the lives and livelihoods of fashion workers in danger and could put at risk an estimated $65 billion of apparel exports by 2030[2][5].
In summary, the fashion industry in 2025 is characterized by economic uncertainty, shifting consumer behaviors, and the need for sustainability and supply chain resilience. Industry leaders are responding by diversifying sourcing, enhancing sustainability, leveraging technology, and targeting new demographics. The current conditions are more challenging than the previous reporting period, with a significant shift in profit drivers from luxury to non-luxury segments. The industry must navigate these complex challenges to find pockets of growth and ensure long-term success. -
Missing episodes?
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The current state of the fashion industry is marked by significant challenges and uncertainties. According to the latest report by McKinsey & Company, "The State of Fashion 2025," the industry is facing a particularly tumultuous and uncertain year ahead. The long-feared cyclical slowdown has arrived, with consumers, affected by recent high inflation, becoming increasingly price-sensitive[1][3].
Key statistics from the report highlight the pessimistic outlook among fashion executives. Only 20% expect improvements in consumer sentiment in 2025, while 39% see industry conditions worsening. This is a continuation of the sluggish growth seen in 2024, with revenue growth expected to stabilize in the low single digits[1][3].
The industry is experiencing significant shifts in consumer behavior, with a growing focus on value-for-money perception. This is driving growth in segments such as resale, off-price, and dupes. The rise of dupes, in particular, is a surprising trend that is expected to continue in 2025[3].
Regional differences are becoming starker, with Asia emerging as a critical market. China's economic deceleration and changing consumer preferences are making growth challenging, leading international fashion brands to look to other Asian markets like India and Japan[3].
The sportswear industry is outperforming the wider fashion market, with sportswear becoming an important part of fashion and growing faster than the fashion market for the first time[5].
In response to these challenges, fashion industry leaders are focusing on diversifying their sourcing footprint in Asia and laying the foundations for nearshoring. They are also looking to engage the "Silver Generation" aged over 50, which represents a growing population with a high share of global spend[3].
Compared to the previous reporting period, the industry's outlook has become more pessimistic. In 2023, 84% of industry leaders expected market conditions to decline or stay the same, while in 2025, this number has increased to 80% expecting no improvement[2][3].
In conclusion, the fashion industry is facing significant challenges in 2025, driven by economic uncertainty, geographic disparities, and shifting customer behavior. Industry leaders must navigate these challenges by identifying bright spots, whether geographic, demographic, or technological, and evolving their strategies to capture growth in a rapidly changing market. -
The fashion industry is entering 2025 with a mix of challenges and opportunities. According to the latest BoF-McKinsey State of Fashion Executive Survey, only 20% of fashion leaders expect improvements in consumer sentiment this year, while 39% anticipate worsening industry conditions[1][4]. This pessimism is largely driven by the ongoing cyclical slowdown, high inflation, and increasing price sensitivity among consumers.
Despite these challenges, there are areas of growth and innovation. The luxury segment is expected to remain resilient, with sales projected to grow 5-10% in 2025[4]. Additionally, new partnerships and collaborations are emerging, such as the highly anticipated reunion of Takashi Murakami and Louis Vuitton, and Willy Chavarria's collaboration with Adidas Originals[2]. These partnerships not only generate buzz but also reflect a shift towards mixing expertise and innovating on familiar concepts to intrigue consumers worldwide.
Supply chain developments are also a key focus for 2025. Retailers are accelerating their reconfiguration of supply chains to prioritize nearshoring and manufacturing in geopolitically-aligned countries. This shift aims to reduce excess inventory and minimize the risk of shortfalls, driven by margin pressures and regulatory demands to reduce emissions and fashion waste[1][4].
Consumer behavior is also undergoing significant changes. The rise of "dupes" and increasing price sensitivity are forcing brands to adapt their strategies. High-net-worth individuals in the United States and new growth engines in Asia are expected to drive demand, while falling inflation and increased tourism in Europe may offer some relief[1][4].
In response to these challenges, industry leaders are focusing on agility and innovation. ANDMORE's Apparel Markets are introducing new initiatives in 2025, including education programs, enhanced buyer resources, and community-focused events to empower retailers and exhibitors[5]. These efforts aim to foster stronger community connections and provide fresh ways to experience markets.
Comparing current conditions to the previous reporting period, the industry's outlook for 2025 appears to be a continuation of the sluggishness seen in 2024, with revenue growth expected to stabilize in the low single digits[1][4]. However, the luxury segment's resilience and the emergence of new partnerships and supply chain strategies offer pockets of growth and innovation. As the industry navigates these challenges, adaptability and innovation will be crucial for brands to seize opportunities and thrive in 2025. -
The global fashion industry is poised for a transformative year in 2025, marked by a blend of opportunities and challenges. According to McKinsey & Company's State of Fashion 2025 report, the industry faces economic headwinds, shifting consumer behaviors, and the need to embrace sustainability while navigating complex global trade dynamics.
Economic growth in the fashion industry is expected to be sluggish in 2025, with revenue growth stabilizing in the low single digits. This reflects economic deceleration and muted consumer confidence, particularly in markets like China and the United States. However, falling inflation and recovering tourism in Europe are seen as bright spots[1][4].
Consumer behavior is also undergoing significant shifts. High inflation has made consumers increasingly price-sensitive, and there is a growing demand for sustainable and environmentally-friendly products. The report notes that 39% of fashion executives expect industry conditions to worsen in 2025, while only 20% anticipate improvements in consumer sentiment[4].
In response to these challenges, fashion industry leaders are focusing on reconfiguring supply chains to prioritize nearshoring and manufacturing in geopolitically-aligned countries. This includes efforts to reduce excess inventory and minimize the risk of shortfalls. Advances in inventory management and new technology will also play a crucial role in addressing margin pressures and reducing emissions and fashion waste[4].
Despite these challenges, there are also opportunities for growth and innovation in the fashion industry. Recent collaborations and partnerships, such as Takashi Murakami x Louis Vuitton and Willy Chavarria x Adidas, are generating significant interest and driving demand for unique and high-end fashion products[2].
ANDMORE's Apparel Markets are also introducing new initiatives in 2025, focused on education, enhanced buyer resources, and fostering stronger community connections. These programs aim to empower retailers and exhibitors with tools to succeed and provide fresh ways to experience markets[5].
In comparison to the previous reporting period, the fashion industry's outlook for 2025 appears to be a continuation of the sluggishness seen in 2024. However, there are still opportunities for growth and innovation, particularly in areas such as sustainability and digital transformation.
Key statistics and data from the past week include:
- The global fashion industry is expected to grow at a low single-digit rate in 2025[1][4].
- 39% of fashion executives expect industry conditions to worsen in 2025, while only 20% anticipate improvements in consumer sentiment[4].
- Falling inflation and recovering tourism in Europe are seen as bright spots for the industry[1][4].
- The climate crisis will remain a potent force across fashion supply chains and in driving consumer behavior[4].
Overall, the fashion industry in 2025 will require navigating a complex landscape of economic uncertainty, shifting consumer behaviors, and regulatory pressures. However, with a focus on innovation, sustainability, and strategic partnerships, there are still opportunities for growth and success in this challenging environment. -
The current state of the fashion industry is marked by uncertainty and challenges, as highlighted in the recent BoF-McKinsey State of Fashion Executive Survey. The industry is expected to face a tumultuous 2025, with only 20% of executives predicting improved consumer sentiment and 39% expecting worse industry conditions[1][4].
The fashion industry's revenue growth is expected to stabilize in the low single digits, a continuation of the sluggishness seen in 2024. Consumers, affected by the recent period of high inflation, are increasingly price sensitive, leading to a shift towards value-for-money segments like resale and dupes[1][4].
Geographic disparities are also evident, with Asia emerging as a growth hotspot. India, Japan, and Korea are seen as new stars in the APAC region, with 63% of executives viewing mature APAC markets as growth hotspots in 2025[4].
In response to these challenges, fashion industry leaders are focusing on reconfiguring supply chains to prioritize nearshoring and manufacturing in geopolitically-aligned countries. Companies are also making efforts to reduce excess inventory and minimize the risk of shortfalls, driven by margin pressures and pressures from governments to reduce emissions and fashion waste[1].
The integration of technology into fashion is also gaining traction, with the global smart clothing market expected to reach $5.3 billion by 2024. Brands such as Levi's and Google are exploring innovations like temperature-regulating fabrics, augmented reality capabilities, and interactive designs[5].
ANDMORE, a leading apparel market platform, is introducing new initiatives in 2025 focused on education, enhanced buyer resources, and fostering stronger community connections. These initiatives include Market Insiders, New Buyer Meet & Greet, and Taste of Atlanta, designed to share market expertise, foster connection, and encourage exploration around the city[2].
In comparison to the previous reporting period, the industry's outlook has become more pessimistic. The 2023 report highlighted the industry's strong performance in 2021 and the first half of 2022, but noted that deteriorating macroeconomic and geopolitical conditions would weigh heavily on the industry in the second half of 2022 and 2023[3].
Overall, the fashion industry is navigating a complex and challenging landscape in 2025. To succeed, companies must be agile, innovative, and responsive to shifting consumer behavior and preferences. By prioritizing sustainability, technology, and community connection, fashion industry leaders can position themselves for growth and success in the years ahead. -
The global fashion industry enters 2025 amidst subdued optimism, with economic uncertainty, technology, and shifting consumer priorities top of mind. According to the latest BoF-McKinsey State of Fashion 2025 report, revenue growth is projected to stabilize in the low single digits, marking a shift away from the luxury-led recovery of previous years[1][4].
For the first time in over a decade, non-luxury segments are driving profit growth, reflecting consumers' growing preference for value-driven options. However, only 20% of industry leaders expect improved consumer sentiment, citing high inflation, geopolitical tensions, and demographic shifts as key concerns[1][4].
Geographically, Asia's role in fashion is diversifying, with China's economic growth slowing and markets like India, Japan, and South Korea stepping into the spotlight[4]. The industry faces entrenched challenges in achieving sustainability, complicated by fragmentation across its value chain, consumer hesitation to pay a premium for sustainable goods, and sluggish regulatory response[1].
Key strategies for brands include consolidating supplier relationships to drive critical mass, partnering with traceability providers for granular emissions data, and prioritizing cost-neutral sustainability measures such as energy efficiency and waste reduction. Brands like H&M, Inditex, and PVH are piloting these approaches through long-term commitments to sustainable materials, shared financing initiatives, and supplier collaborations[1].
In response to current challenges, fashion industry leaders are focusing on education, enhanced buyer resources, and fostering stronger community connections. ANDMORE's Apparel Markets, for example, are launching new initiatives in 2025, including Market Insiders, New Buyer Meet & Greet, and Taste of Atlanta, designed to share market expertise, foster connection, and encourage exploration[2].
Technology will be critical for fashion businesses in 2025, with success hinging on collaborating with partners, using best-in-class technology tools, implementing actionable strategies, and continually adjusting these efforts to align with the changing priorities of the fashion industry[5].
Compared to the previous reporting period, the industry's growth trajectory has shifted decisively from the post-pandemic boom to low single-digit expansion, marking what analysts describe as a "structural deceleration"[1][3]. The luxury segment, which previously drove growth, is expected to see non-luxury players drive the entirety of economic profit growth for the first time since 2010[1].
In conclusion, the fashion industry in 2025 is characterized by subdued optimism, shifting consumer priorities, and a focus on sustainability and technology. Industry leaders are responding to current challenges by prioritizing education, community connections, and cost-neutral sustainability measures, while also leveraging technology to drive success. -
The current state of the fashion industry is marked by uncertainty and challenges, as highlighted in the latest reports from the Business of Fashion and McKinsey. The industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a slower pace compared to previous years[1][5].
Consumer confidence remains fragile, particularly in key markets such as the US, Europe, and China, due to ongoing economic and geopolitical challenges. The climate crisis has also become a significant pressure point, with extreme weather events in 2023 emphasizing the need for the industry to build resilience into its supply chains and reduce emissions[1].
In response to these challenges, fashion companies are focusing on growing sales through new pricing and promotion strategies rather than volume increases. The industry is expected to bear the impact of fluctuations in demand, leading to a "bullwhip effect" in supply chains, causing factory underutilization, layoffs, and delayed infrastructure investments[1].
The luxury segment is expected to generate the biggest share of economic profit, with global growth forecast at 3 to 5 percent, compared to 5 to 7 percent in 2023. However, even within luxury, companies will face challenges due to the tough economic environment[5].
Regional differences are pronounced, with European growth expected to slow to 1 to 3 percent, while US growth is expected to pick up after a relatively weak 2023. China is expected to see growth of 4 to 6 percent, a slight uptick from the end of 2023 but slow on a historical basis[5].
To navigate these challenges, fashion brands are investing in developing more transparent and collaborative relationships with their suppliers. Vertical integration has emerged as a vital strategy for garment manufacturers, enhancing control over production and reducing lead times[3].
Sustainability demands are also becoming standard business concerns, with the need for rapid production and transparency intensifying. The industry is expected to see significant technological advancements, with robots potentially replacing traditional labor roles and data guiding business decisions[3].
In conclusion, the fashion industry is facing a challenging period, with slow growth, fragile consumer confidence, and significant environmental pressures. However, by focusing on sustainability, vertical integration, and collaborative supply chain relationships, industry leaders are responding to these challenges and positioning themselves for success in the year ahead. -
The fashion industry is navigating a challenging era marked by economic uncertainty, geopolitical tensions, and the pressing need for sustainability. According to the BoF-McKinsey State of Fashion 2024 report, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a modest increase compared to previous years[1].
Consumer confidence remains fragile, with different markets facing unique challenges. In the US, Europe, and China, fashion leaders are anticipating further headwinds, with 85 percent of executives predicting inflation will continue to challenge the market[3]. The climate crisis has also become a critical concern, with extreme weather events in 2023 highlighting the need for the fashion industry to build resilience into its supply chains and reduce emissions[1].
Despite these challenges, the industry is seeing a surge in collaborations and partnerships. Notable examples include Levi's sold-out capsule with Kiko Kostadinov, the collection from Wolverine brands Merrell and Sweaty Betty, and the partnership between Authentic Brands Group properties Reebok and Juicy Couture[2]. These collaborations are helping brands to innovate, differentiate their offerings, and tap into new market segments.
Vertical integration is emerging as a vital strategy for garment manufacturers, enabling them to control more stages of the supply chain, reduce lead times, and enhance efficiency[4]. Private label partnerships are also becoming increasingly important, allowing fashion brands to leverage the expertise and resources of their partners to develop exclusive product lines and expand their reach[5].
In terms of consumer behavior, there is a growing demand for sustainability, with 58 percent of executives believing that the energy crisis will weaken the fashion market[3]. The industry is responding to this demand by incorporating sustainable practices into their business strategies, with a focus on reducing waste, using eco-friendly materials, and promoting transparency.
Compared to the previous reporting period, the industry is facing a more uncertain and challenging environment. The global economic outlook is unsettled, and the industry is expected to contract between 5 percent and 7 percent in the second half of 2022, with slight improvements in 2023[3]. However, the luxury segment is expected to show more resilience, with sales projected to grow 5 percent to 10 percent in 2023[3].
In conclusion, the fashion industry is navigating a complex and challenging landscape, marked by economic uncertainty, geopolitical tensions, and the need for sustainability. Despite these challenges, the industry is seeing a surge in collaborations and partnerships, and is responding to the growing demand for sustainability by incorporating eco-friendly practices into their business strategies. By leveraging private label partnerships, vertical integration, and sustainable practices, fashion brands can position themselves for success in this dynamic and rapidly evolving industry. -
The current state of the fashion industry is characterized by uncertainty and challenges, with executives anticipating further headwinds in 2024. According to the BoF-McKinsey State of Fashion 2024 Executive Survey, the word most often mentioned by executives was "uncertainty," reflecting concerns about consumer confidence, economic conditions, and the climate crisis[1].
In terms of market movements, the fashion industry is predicted to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a slower pace than in previous years[1]. This is partly due to economic challenges, including inflation and geopolitical tensions, which are expected to continue to weigh heavily on consumer confidence.
Despite these challenges, collaborations and partnerships remain a key strategy for fashion brands. Recent deals include Levi's sold-out capsule with Kiko Kostadinov, a collection from Wolverine brands Merrell and Sweaty Betty, and a pair-up between Authentic Brands Group properties Reebok and Juicy Couture[2]. These collaborations aim to create new and covetable products while maintaining separate brand identities.
Emerging competitors and new product launches are also shaping the industry. For example, Mango and Victoria Beckham released a capsule collection in April as part of Mango's 40th anniversary celebration, highlighting the push towards more high-end capsules[2].
Regulatory changes and significant market disruptions are also on the horizon. The climate crisis is becoming increasingly visible, with extreme weather events in 2023 leaving the fashion value chain vulnerable. As a result, leading companies are likely to bolster their resilience to climate impacts in 2024[1].
In terms of shifts in consumer behavior, sustainability is becoming a core business strategy, with waste being transformed into raw materials and data guiding production[4]. Consumers are increasingly environmentally conscious, driving demand for eco-friendly products.
Supply chain developments are also underway, with end-to-end vertical integration emerging as a vital strategy for garment manufacturers. This involves factory owners expanding into textile production, knitting, and dyeing to meet increasingly crunched buyer timelines[4].
Fashion industry leaders are responding to current challenges by forming private label partnerships, which can unlock new opportunities for growth, innovation, and market penetration[5]. Identifying strategic partners is critical, as they can provide access to new technologies, expertise, and markets.
Compared to the previous reporting period, the industry is facing a more challenging environment, with slower growth predicted and increased uncertainty. However, by leveraging collaborations, sustainability, and supply chain innovations, fashion brands can navigate these challenges and remain competitive.
In conclusion, the fashion industry is navigating a complex and challenging landscape in 2024, with uncertainty and economic challenges weighing heavily on consumer confidence. However, by embracing collaborations, sustainability, and supply chain innovations, fashion brands can respond to these challenges and remain competitive in a rapidly evolving market. -
The current state of the fashion industry is characterized by uncertainty and challenges, with various factors influencing its trajectory. According to the BoF-McKinsey State of Fashion 2024 report, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, despite ongoing economic and geopolitical challenges[1].
One of the significant pressures facing the industry is the climate crisis, which has become increasingly visible due to extreme weather events in 2023. Fashion leaders are recognizing the need to build resilience into their supply chains and reduce emissions to mitigate climate risks[1].
In terms of market movements, collaborations have been a significant trend in 2024, with notable partnerships such as Levi's with Kiko Kostadinov, Mango with Victoria Beckham, and Gap with Palace[2]. These collaborations aim to combine the best aesthetics of each brand while maintaining separate identities and creating something new and desirable.
The industry is also witnessing a shift towards vertical integration, with garment manufacturers expanding into textile production, knitting, and dyeing to meet increasingly tight buyer timelines. This strategy enhances control over production, reduces lead times, and enables agility in responding to market changes and customer demands[4].
Private label partnerships are another strategic approach being adopted by fashion brands to expand their reach and influence. These collaborations can unlock new opportunities for growth, innovation, and market penetration by co-creating exclusive product lines and leveraging the expertise and resources of private label partners[5].
In comparison to the previous reporting period, the industry's growth prospects have become more cautious. The BoF-McKinsey State of Fashion 2023 report predicted global fashion sales growth of 5 percent to 10 percent for luxury and negative 2 percent to positive 3 percent for the rest of the industry in 2023[3]. However, the current outlook is more subdued, with a focus on navigating challenges and building resilience.
Consumer behavior is also shifting, with a growing emphasis on sustainability and environmental consciousness. Fashion brands are responding to these changes by incorporating eco-friendly practices and materials into their products and supply chains.
In conclusion, the fashion industry is navigating a challenging era, with uncertainty and climate risks being key concerns. However, industry leaders are responding by adopting strategic approaches such as collaborations, vertical integration, and private label partnerships to drive growth and innovation. By focusing on sustainability and agility, fashion brands can build resilience and thrive in a rapidly changing landscape. -
The current state of the fashion industry is marked by uncertainty and challenges, as highlighted in the latest reports from the Business of Fashion and McKinsey. The industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a slower pace compared to previous years[1][5].
One of the major pressures facing the industry is the climate crisis. Extreme weather events in 2023 have underscored the need for fashion companies to build resilience into their supply chains and reduce emissions. This is not just an environmental imperative but also a business necessity, as climate risks could put at risk an estimated $65 billion of apparel exports by 2030[1].
Consumer confidence remains fragile, with differing headwinds in key markets such as the US, Europe, and China. In the US, non-luxury sector growth is forecast to be between 0 and 2 percent, while in Europe, the market is expected to expand by just 1 to 3 percent. China is expected to see growth of 4 to 6 percent, which is a slight uptick but slow on a historical basis[5].
The luxury segment is expected to generate the biggest share of economic profit, with global growth forecast at 3 to 5 percent. However, even luxury companies will be challenged by the tough economic environment, as consumers rein in spending after a post-pandemic surge[5].
In response to these challenges, fashion industry leaders are focusing on sustainability, vertical integration, and consolidation. The rise of vertical integration is a key trend, with garment manufacturers expanding into textile production, knitting, and dyeing to meet increasingly crunched buyer timelines and enhance control over production[3].
Consolidation is also a major theme, with the survival of the fittest becoming a reality in the industry. Companies are looking to combine careful cost control with strategic investments in skills growth to navigate the challenging economic landscape[3].
The fast fashion market, despite its environmental and social challenges, is projected to reach $197 billion by 2028, driven by innovations in supply chain management and the demand for high fashion at low cost[4].
In conclusion, the fashion industry is facing a complex and challenging environment in 2024. While growth is expected, it will be slower and more uneven than in previous years. Industry leaders are responding by focusing on sustainability, vertical integration, and consolidation, and by adapting to shifts in consumer behavior and supply chain developments. The industry must navigate these challenges to ensure long-term success and resilience. -
The current state of the fashion industry is marked by uncertainty and challenges, with various factors influencing its trajectory. According to the BoF-McKinsey State of Fashion 2024 report, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a slower pace compared to previous years[1].
One of the significant pressures facing the industry is the climate crisis. Extreme weather events in 2023 have highlighted the need for resilience and sustainability in supply chains. Leading companies are likely to bolster their efforts in this area, with a focus on reducing emissions and integrating sustainable materials and processes[1].
In terms of market movements, the global economic outlook remains unsettled, with differing headwinds in key markets such as the US, Europe, and China. This requires suppliers, brands, and retailers to enhance contingency planning and adapt to changing market conditions[1].
Recent partnerships and collaborations are shaping the future of the fashion industry. For instance, close collaborations with textile manufacturers are crucial for successful sample development, enabling access to the latest developments in fabric technology and sustainable materials[2]. Co-creation initiatives with influential fashion brands are also pivotal, fostering innovation, enhancing market adaptability, and promoting sustainability[2].
Emerging trends in the fashion industry include the rise of vertical integration, with garment manufacturers expanding into textile production, knitting, and dyeing to meet increasingly crunched buyer timelines[4]. Consolidation is also a key trend, with businesses needing to navigate complex geopolitical landscapes and respond to changing trade policies and labor laws[4].
In terms of consumer behavior, there is a growing demand for sustainability and transparency. Consumers are increasingly eco-conscious, and companies are responding by integrating sustainable materials and processes into their products[2][4].
Regulatory changes and market disruptions are also influencing the industry. For example, the World Bank's 2024 projections indicate the worst global economic growth in three decades, emphasizing the need for agile and tech-savvy business responses[4].
Industry leaders are responding to current challenges by focusing on sustainability, resilience, and innovation. For instance, Balenciaga's collaboration with Manchester United and Off-White's partnership with the Golden State Warriors demonstrate the potential for unique crossovers that resonate with both fans and fashion-forward consumers[5].
In comparison to the previous reporting period, the industry's growth has slowed down, and the outlook is more cautious. However, there are opportunities for businesses that can adapt to changing market conditions and prioritize sustainability and innovation[1][3].
Overall, the fashion industry is navigating a challenging era, with a focus on resilience, sustainability, and innovation. By understanding the current state of the industry and responding to emerging trends and challenges, businesses can position themselves for success in the years ahead. -
The fashion industry is navigating a challenging era in 2024, marked by economic uncertainty, shifting consumer behavior, and increasing pressure to address sustainability concerns. According to the BoF-McKinsey State of Fashion 2024 report, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, despite ongoing headwinds[1].
One of the key challenges facing the industry is the climate crisis, which has become more visible due to extreme weather events in 2023. Leading companies are likely to bolster their resilience to climate impacts in 2024, as inaction could put at risk an estimated $65 billion of apparel exports by 2030[1].
In response to these challenges, fashion companies are adopting various strategies. One approach is vertical integration, where garment manufacturers expand into textile production, knitting, and dyeing to enhance control over production and reduce lead times[4]. Another strategy is collaboration, with partnerships between textile manufacturers, fashion designers, and tech providers becoming increasingly important for successful sample development[2].
Sustainability is also a key focus area, with many leading brands committed to reducing their environmental impact. Co-creation initiatives with influential fashion brands are essential for successful sample development, as they foster innovation, enhance market adaptability, and promote sustainability[2].
Recent market movements include the rise of sports-fashion collaborations, with brands like Balenciaga and Off-White teaming up with sports teams to create unique crossovers that resonate with both fans and fashion-forward consumers[5].
In terms of consumer behavior, there is a growing demand for sustainable and eco-friendly products. According to the World Bank's 2024 projections, the need for rapid production and transparency has intensified, and agile and tech-savvy business responses are crucial for survival[4].
Compared to the previous reporting period, the industry is facing more uncertainty and pressure to address sustainability concerns. However, there are also opportunities for growth and innovation, particularly in the areas of digitalization and sustainability.
Overall, the fashion industry is navigating a complex and challenging landscape in 2024. While there are headwinds to contend with, there are also opportunities for growth and innovation, particularly in the areas of sustainability and digitalization. By adopting strategies such as vertical integration, collaboration, and co-creation, fashion companies can position themselves for success in this challenging era. -
The current state of the fashion industry is marked by uncertainty and challenges, with leaders anticipating further headwinds in 2024. According to the BoF-McKinsey State of Fashion 2024 Executive Survey, the word most often mentioned by executives was "uncertainty," reflecting concerns about consumer confidence, economic conditions, and the climate crisis[1].
In terms of market movements, the fashion industry is predicted to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024, a slower pace than in previous years[1]. This is partly due to deteriorating macroeconomic and geopolitical conditions, which have weighed heavily on the industry since the second half of 2022[3].
One of the key challenges facing the industry is the climate crisis, with extreme weather events in 2023 highlighting the need for resilience and sustainability in supply chains[1]. In response, companies are bolstering their contingency planning and investing in sustainable materials and practices. For example, collaborations with textile manufacturers and tech providers are becoming increasingly important for successful sample development, enabling brands to access the latest developments in fabric technology and reduce their environmental impact[2].
Another trend shaping the industry is the rise of vertical integration, with garment manufacturers expanding into textile production, knitting, and dyeing to meet increasingly crunched buyer timelines[4]. This shift demands substantial capital investment and a reevaluation of traditional business models but offers benefits such as enhanced efficiency, superior quality control, and heightened competitiveness.
In terms of partnerships, sports-fashion collaborations are becoming increasingly popular, with brands like Balenciaga and Off-White teaming up with sports teams to create unique crossovers that resonate with both fans and fashion-forward consumers[5].
Compared to the previous reporting period, the industry's outlook has become more cautious, with 84 percent of industry leaders expecting market conditions to decline or stay the same in 2023, compared to 91 percent who predicted improvement or stability in 2022[3]. The effects of inflation are also weighing heavily on executives, with prices in Europe and the US reaching historic highs and central banks raising interest rates.
Overall, the fashion industry is navigating a challenging era, with leaders responding to current challenges by investing in sustainability, adopting new technologies, and reevaluating traditional business models. As the industry continues to evolve, agility and tech-savviness will be crucial for survival. -
The fashion industry is navigating through a period of uncertainty and resilience in 2024. According to the BoF-McKinsey State of Fashion 2024 report, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024[1]. This modest growth is influenced by various economic challenges and the ongoing climate crisis, which has become increasingly visible due to extreme weather events in 2023.
One of the significant pressure points for the industry is the climate crisis. The report highlights that leading companies will need to bolster their resilience to climate impacts in 2024. New sustainability regulations in the European Union and the US will require brands and manufacturers to cut greenhouse gas emissions and waste, while building business models that protect and preserve natural resources. This could particularly impact the fast-fashion industry, which faces increased scrutiny and competition from companies like Shein and Temu[1].
In terms of market performance, the global fashion industry is expected to exceed $770 billion in revenue in 2024, with a compound annual growth rate (CAGR) of 8.94% until 2029[2]. The US alone accounts for $358.70 billion in revenue in 2024, with a growth rate of 2.11% until at least 2028[2].
Emerging trends and collaborations are also shaping the industry. Sports-fashion collaborations have become increasingly popular, with brands like Balenciaga partnering with Manchester United and Off-White collaborating with the Golden State Warriors[3]. Luxury brands such as Miu Miu, Saint Laurent, and Alaïa are setting the tone for high-end fashion trends, with a focus on bohemian styles, opulent maximalism, and directional designs[4].
In response to current challenges, fashion industry leaders are prioritizing generative AI, with 73% of executives expecting to prioritize gen AI in 2024[1]. However, many may face a talent gap, as only 5% of executives said they are ready to make the best use of the technology.
Compared to the previous reporting period, the industry is facing increased uncertainty and pressure to adapt to evolving consumer preferences and regulatory changes. The focus on sustainability and climate resilience is becoming more critical, and companies that fail to address these issues may face significant challenges in the years ahead.
Overall, the fashion industry is navigating through a complex landscape, with modest growth prospects and significant challenges ahead. Industry leaders must prioritize sustainability, innovation, and adaptability to stay ahead in the market. -
The current state of the fashion industry is marked by significant challenges and transformations. According to recent reports, the industry is navigating a complex landscape shaped by technological innovations, environmental considerations, evolving consumer demands, and shifting geopolitical dynamics[1][2].
One of the key trends in 2024 is the increasing focus on sustainability. The climate crisis has become more visible, with extreme weather events in 2023 highlighting the need for resilience and emission reduction in the fashion supply chain[2][4]. Industry leaders are bolstering their sustainability strategies, with a growing emphasis on circular fashion and the resale market, which challenges the traditional linear model of 'buy-use-dispose' and promotes a more sustainable lifecycle for garments[3].
Artificial intelligence is also revolutionizing the apparel industry, impacting stages from manufacturing and design to sales and customer experience. AI-driven systems in manufacturing will detect and correct fabric defects with high precision, while generative AI will foster the creation of innovative digital clothes, offering artistic and sustainable alternatives to physical garments[3][4].
Consumer behavior is shifting, with a growing demand for inclusivity and diversity in apparel design, reflected in the rise of gender-fluid fashion. This movement is closely intertwined with sustainable apparel, as environmentally conscious consumers increasingly seek eco-friendly and ethically produced clothing[3].
The global economic outlook remains uncertain, with ongoing financial and geopolitical issues affecting consumer confidence and spending. The anticipated global GDP growth rate is projected to decrease to 2.9% in 2024, suggesting a potential moderation in consumer spending[4].
Industry leaders are preparing for a strategically complex year ahead, with a focus on planning for different scenarios, managing pricing strategies, and gearing up for rapid action when the context calms. The return of brand marketing is also highlighted, as consumers' emotional connections to brands become critical in a shifting landscape[2][4].
Recent data indicates that global travel is estimated to surpass pre-pandemic levels in 2024, reaching as high as 110% of the numbers seen in 2019. This rebound creates an opportunity for fashion players to view their global growth maps with a new lens and innovate marketing initiatives that resonate with 2024's travel zeitgeist[4].
In conclusion, the fashion industry in 2024 is characterized by adaptability, innovation, and ethical alignment with emerging trends. The industry's future hinges on its ability to embrace and navigate these transformations with strategic foresight and operational agility. Key statistics include a projected 2-4% year-on-year retail sales growth in 2024 and a 2.9% global GDP growth rate, underscoring the need for careful planning and resilience in the face of uncertainty[2][4]. -
The current state of the fashion industry is marked by uncertainty and challenges, but also by opportunities for growth and innovation. According to the latest State of Fashion report by The Business of Fashion and McKinsey, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024[2][3].
However, this growth is threatened by various challenges, including global economic uncertainty, climate crises, and evolving consumer behaviors. The report highlights that more than 50 percent of fashion executives expect to raise prices in response to macroeconomic, geopolitical, and climate-crisis pressures, which may challenge the industry's growth[3].
One of the key trends shaping the industry is the increasing focus on sustainability. The climate crisis has become more visible, with extreme weather events in 2023 putting fashion workers' lives and livelihoods in danger and potentially putting an estimated $65 billion of apparel exports at risk by 2030[2][3]. As a result, industry leaders are prioritizing sustainability and resilience in their supply chains.
Another significant trend is the rise of generative AI in the fashion industry. According to McKinsey, up to a quarter of generative AI's potential value in the fashion industry could stem from its application in design and product development[5]. However, there is a substantial gap between the potential and actual use of generative AI, with only 28% of fashion leaders having used it in creative processes related to design and product development.
The industry is also seeing a shift towards brand marketing, with major players moving away from performance marketing and focusing on building long-term emotional connections with audiences[3][5]. Additionally, the rise of outdoor and technical clothing is expected to continue, driven by the post-pandemic shift towards healthier living and the increasing demand for functional and stylish clothing[3].
In terms of supply chain developments, the industry is facing challenges due to fluctuations in consumer demand, which are causing volatility in supply chains and prompting brands and retailers to emphasize transparency and strategic partnerships in their supply chain management[3].
Industry leaders are responding to these challenges by prioritizing agility, sustainability, and innovation. For example, companies are exploring new uses of generative AI, investing in sustainable practices, and revamping their brand marketing strategies to focus on emotional connections with consumers.
Compared to the previous reporting period, the industry is facing more uncertainty and challenges, but also more opportunities for growth and innovation. The focus on sustainability and resilience is becoming more critical, and the rise of generative AI and brand marketing is changing the way companies operate and engage with consumers.
Overall, the fashion industry is at a pivotal moment, where innovation intersects with sustainability and ethical practices. By prioritizing agility, sustainability, and innovation, fashion brands can navigate the complexities of the year ahead and emerge stronger in the pursuit of a more inclusive and sustainable future. -
The current state of the fashion industry is marked by significant challenges and transformations. According to recent reports, the industry is expected to face a complex year ahead, with global economic uncertainty, climate crises, and evolving consumer behaviors shaping the landscape[2][3].
One of the key trends in 2024 is the increasing focus on sustainability and climate policies. The fashion industry's supply chain is particularly vulnerable to extreme weather-related events, which could put an estimated $65 billion of apparel exports at risk by 2030[3]. In response, industry leaders are prioritizing resilience and emission reduction, with the European Union already approving legislation that includes a ban on the destruction of unsold textiles[3].
Another significant trend is the rise of generative AI in the fashion industry. According to McKinsey, 73% of fashion leaders consider generative AI a priority for their businesses in 2024, with potential applications in design, product development, and customer experience[2][5]. However, there is a substantial gap between intention and implementation, with only 28% of fashion leaders having actually used generative AI in creative processes[5].
The industry is also experiencing a shift towards personalized and technical outdoor clothing, driven by consumers' post-pandemic embrace of healthier lifestyles and "gorpcore"[2][3]. This trend is prompting outdoor brands to launch lifestyle collections and lifestyle brands to infuse technical elements into their offerings.
In terms of market movements, the fashion industry is expected to achieve year-on-year retail sales growth of between 2% and 4% in 2024, despite ongoing economic uncertainty[2]. However, consumer confidence remains fragile, with different challenges affecting major markets in the US, Europe, and China[2].
Industry leaders are responding to these challenges by investing in more transparent and collaborative relationships with their suppliers, prioritizing sustainability and regulatory compliance, and exploring innovative technologies like generative AI[2][3]. For example, some brands are using AI-driven systems to detect and correct fabric defects, while others are leveraging social media to engage with consumers and promote sustainable practices[4].
Compared to the previous reporting period, the fashion industry is facing increased pressure to adapt to changing consumer behaviors and regulatory requirements. The industry's resilience and adaptability will be crucial in navigating the complexities of the year ahead and emerging stronger in the pursuit of a more inclusive and sustainable future.
In conclusion, the current state of the fashion industry is characterized by significant challenges and transformations, driven by economic uncertainty, climate crises, and evolving consumer behaviors. Industry leaders are responding by prioritizing sustainability, regulatory compliance, and innovative technologies, with a focus on building resilience and driving growth in a complex and uncertain landscape. -
The current state of the fashion industry is marked by economic uncertainties, climate crises, and evolving consumer behaviors. According to the eighth annual State of Fashion report by The Business of Fashion and McKinsey & Company, the industry is expected to achieve year-on-year retail sales growth of between 2 percent and 4 percent in 2024[2][3].
However, this growth is anticipated to be sluggish, with luxury brands facing challenges after a lengthy period of growth. The report highlights that more than 50 percent of fashion executives expect to raise prices in response to macroeconomic, geopolitical, and climate-crisis pressures, which may challenge the industry’s growth[3].
One of the significant challenges facing the industry is the climate crisis. Extreme weather events in 2023 have brought urgency to the issue, particularly impacting the fashion industry's supply chain. The sector must prioritize resilience and actively contribute to emission reduction, as extreme weather could put an estimated $65 billion of apparel exports at risk by 2030[2][3].
In terms of consumer behavior, there is a growing desire for brand experiences and traditional shopping trips, especially with the return of travel. Global travel is estimated to surpass pre-pandemic levels in 2024, reaching as high as 110% of the numbers seen in 2019. This rebound creates an opportunity for fashion players to proactively identify emerging hotspots and innovate marketing initiatives[4].
Supply chain challenges continue to impact the industry, with the "bullwhip effect" caused by fluctuations in consumer demand leading to factory underutilization, layoffs, and delayed infrastructure investments. To navigate these challenges, fashion brands should consider investing in developing more transparent and collaborative relationships with their suppliers[2][4].
Industry leaders are preparing for a strategically complex year ahead, with a focus on bolstering contingency planning, managing pricing strategies, and gearing up for rapid action when the context eventually calms. The report outlines ten crucial issues that will dictate the textile industry’s priorities over the next twelve months, including climate urgency, vacation mode, and the rise of outdoor and technical clothing[2][4].
In response to current challenges, fashion industry leaders are prioritizing agility, sustainability, and innovation. For example, around 73 percent of executives expect to prioritize generative AI in 2024, recognizing its value beyond automation and its potential to augment human creativity[3].
Compared to the previous reporting period, the industry is facing increased economic uncertainty, with the global GDP growth rate projected to decrease to 2.9% in 2024. This slowdown suggests a potential moderation in consumer spending for the upcoming year[4].
Overall, the fashion industry is navigating a challenging era, with economic uncertainties, climate crises, and evolving consumer behaviors shaping the year ahead. By prioritizing agility, sustainability, and innovation, fashion brands can navigate the complexities of the year ahead and emerge stronger in the pursuit of a more inclusive, sustainable future. - Show more
