What Extended Lockdowns and Slow Vaccine Distribution Mean for the Fashion Business

The Business of Fashion Podcast

The Business of Fashion

Fashion & Beauty, Business, Arts

4.6 • 770 Ratings

🗓️ 21 January 2021

⏱️ 34 minutes

🔗️ Recording | iTunes | RSS

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Summary

BoF’s Imran Amed and McKinsey’s Achim Berg discuss what the fashion industry can expect as the world continues to battle Covid-19.

With coronavirus cases surging in most of Europe, extended lockdowns show no immediate sign of easing, while in the US ongoing political and social unrest is set against a backdrop of widespread Covid-19 infections. For fashion, the repercussions will be felt for years to come, but the extent of the impact will largely depend on the handling of such crises over the course of the next year.In the latest episode of The BoF Podcast, BoF editor-in-chief Imran Amed and Achim Berg, global leader of McKinsey’s apparel, fashion and luxury group, discuss the key trends laid out in BoF and McKinsey’s joint annual report, The State of Fashion 2021, in light of recent developments.

While experts had warned that the winter months would be challenging, super-spreading virus mutations in Brazil, South Africa and the UK have further complicated matters. “It’s fair to say that we expected lockdowns, we expected restrictions, but we didn’t expect them that early, and we didn’t expect them to take that long,” said Berg, adding that these developments might indicate a slower-than-anticipated recovery for fashion.
The closing of physical retail and low consumer confidence has hit retailers both with and without e-commerce hard. “Even if online is growing at 50 percent, you cannot compensate for physical retail,” said Berg. But it’s not all bad news. “The moment things normalise, I think people want to have the shopping experience again,” he added.
Stores reliant on tourists for a large portion of their sales are reeling from losses as flights stay grounded, but there is also cause for optimism. “It’s a whole new game, but it’s also an opportunity” said Berg. “I would argue that because in some locations it was easy to serve international customers, they didn’t put [enough] emphasis on serving local consumers.”

Related Articles: The State of Fashion 2021 Report: Finding Promise in Perilous Times Tapping Into the Future of Physical Retail Travel Disruption Will Redraw the Fashion Map Watch and listen to more #BoFLIVE conversations here. To contact The Business of Fashion with comments, questions or speaker ideas please email [email protected].

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Transcript

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0:00.0	Hi, this is Imran Ahmed, founder and CEO of the Business of Fashion. Welcome to the
0:14.8	Bof podcast. It's Thursday, January 21st. A few months ago when we were putting together our state of fashion
0:21.4	2021 report with McKinsey and company, we decided to take a somewhat different approach.
0:26.6	Given all the uncertainty around the coronavirus pandemic, we mapped out two different
0:30.9	scenarios for an economic recovery and a resulting fashion industry recovery, largely dependent
0:36.8	on the massive rollout of three vaccines,
0:39.4	which were approved by health authorities
0:41.5	in many countries around the world.
0:43.3	But as the new year begins,
0:44.7	the prospects for an earlier recovery are beginning to dim.
0:48.7	In December, a new variant of the coronavirus
0:51.5	was discovered in the UK,
0:53.0	leading to a massive spike in cases which
0:55.2	seemed to outpace the vaccination program, despite the fact that the UK was the first country
1:00.7	to approve the Pfizer-Biontech vaccine. This is Matt Hancock, the health secretary, breaking the
1:06.8	bad news to UK residents on December 23rd. Good afternoon and welcome to Downing Street for today's coronavirus briefing.
1:14.6	We all know that 2020 has been a hard year and it's ending in this festive period which is going
1:22.4	to be very different. After all the efforts that we've gone through to control this virus, just as we've got
1:31.5	a tiered system in place that was able to control this virus, we've discovered a new, more
1:38.6	contagious virus, a variant that is spreading at a dangerous rate.
1:50.1	So, in early January, the UK was put back into its third national lockdown, which is now expected to continue until early March.
1:52.7	In continental Europe, the news was not much better.
	...

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