COVID-19 | How to lower the financial impact on the industry

Due to Covid-19 stores have to close and shoppers are in no buying mood, not even online. It is simply not fun to shop and not be able to wear something new outside your home. It is also not fun to hear of the dire situation and meanwhile go on a shopping spree. However, every crises offers chances.

We at WeAr spoke to countless retailers and brands and came to the following suggestion:

1) All delivered spring /summer items will be packed and stored for March/April 2021

We simply skip S/S 2020. Brands can still produce some “key-pieces”, but the bulk gets packed and stored and used for spring 2021.

The advantage of this scenario will be that retailers are not forced to heavily discount or even write-off merchandise, but can sell it to the regular price. Whatever won’t sell now, will be sold in a year.

Brands will lose one season of sales, but save a lot of their clients from dire financial situation and potentially bankruptcy, which ultimately will result in the client not being able to pay its brand-partners. All retailers have to pay for, is the interest and storage fees for 12 months.

Autumn winter could run as usual and losses would be minimized.To now force retailers to quickly get rid of stock with heavy discounts, will flood the market and not generate profit.

2) Shifting Sales Season

Trying to make the best out of the tragic situation should also trigger a new way seasons are currently handled by all participants from trade-shows, producers, brands to buyers.

It makes no sense to discount a pullover in the best time of winter, when consumers need warm clothing most. Instead, these items need to be discounted at the end of the winter, if at all.

3) Delivery of merchandise and shifts of Order Rounds

The entire system has to get re-booted. Winter should get delivered 6 weeks ahead of winter, not in summer, as we sometimes do. The same applies of course for spring/summer. Subsequently: Order Rounds should start for autumn/winter in February and March and for spring/summer early September.

If we would implement this mechanism, which used to be standard in the industry, merchandise can be sold quicker, cash-flow would be quicker, write-offs will be less. Win, win, win. This way the impact of Corona would be minimzed and offset by better bsuiness in the years to come.

Please let us know your thoughts and suggestions, as it’s time for a change.

Stay healthy and all the very best,
Yours WeAr Global Magazine team.