TOUGH FINANCIAL TIMES AFFECTING DESIGNERS - The effects of a struggling...

TOUGH FINANCIAL TIMES AFFECTING DESIGNERS

The effects of a struggling economy on fashion....

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By Laila Lu

The future of many retail stores are seeing calamity due to the recession that America is going through. As clothing labels and chains are closing down one by one, it gets even harder for designers to get enough backing to continue their business.

WWD has reported that Neiman Marcus, one of the top retail stores in US, is suffering from a loss of $31.7million in the second quarter of the year while Macy’s Inc ($59 million loss in first quarter), Kohl’s Corp. and Nordstrom Inc. have all reported lower second-quarter earnings. Meanwhile, Steve & Barry’s, the retailer that used to carry Sarah Jessica Parker’s Bitten line, has filed for chapter 11 bankruptcy. In general, women’s apparel sales have dropped a total of 3.8% over the past year.

While the economy is one of the main reason, rip-offs and changing consumer behavior are also some of the factors why the fashion-business world is having a hard time.

As Narcisco Rodriguez once mentioned, copycat items steal around $1.3million of his business every year.

His company might not be suffering decrease in sales like some others but the profit figure has not been increasing like 20 percent per year as usual.

As for customers, buying only during sale season and rummaging sample sales seems to be a trend right now. In that way, retailers are getting less profits. What’s worse is that the shoppers preferred to drop on huge fashion brands rather than fresh designer labels. This has almost forced a handful of the young guns to quit showing during fashion week due to insufficient funding.

Like what Narcisco would say: “We are trudging through this Bush mess and looking forward to the next steps.” Let’s keep praying.

Photos courtesy of the Fashion Spot forums.