High Risk High Fashion
April 7th 2020
Words by Emily Batters
It’s not just us humans that are feeling the effect of the virus. COVID 19 flushes out luxury sales. The luxury market is in the high-risk category in regards to the fashion industry. Who would have thought that in our current age in fashion of logo mania and high spending, we’d see a predicted loss of almost £43 billion in sales. This however has been made very realistic and true due to the coronavirus outbreak, that we are all so familiar of.
It is affecting the shopping habits of their biggest customer base. The Chinese make up for 41% of the global luxury market. According to research by Bain & Company for the World Economic Forum; by 2027, middle-class consumers will represent an estimated 65% of all Chinese households, according to research by Bain & Company for the World Economic Forum.
Along with China, Italy is another crucial place to the luxury goods industry that was hit critically hard by the corona virus. Italy and specifically Milan are the Epicentre of luxury fashion, a major luxury good market and supplier. The headquarters of Prada, Versace, and Armani are all here, while many other international brands, such as Louis Vuitton and Stella McCartney, rely on Italy for the manufacturing of goods.
The disruption to travel that the corona virus is also responsible for is costly to the luxury good market. It is estimated that about 40% of all luxury goods spending is in one way or another a result of travel, either purchases made in airports, duty-free stores or on cruise ships or in destinations visited by business and leisure travellers.