Matchesfashion innovator programme

It doesn’t take a genius to note that now is not the ideal time to launch a new fashion business. If you are launching your new business, this season, you probably started way before this disaster of a virus appeared and it was too late not to see it through. Too much time and money has been invested to pull out. You’re not a quitter.

Left - In September, MATCHESFASHION launched its The Innovators Programme to help support young designers

It’s a bit like all those cranes on the skyline and builders finishing off their dense blocks of luxury flats. It’s too late to down tools, not finish them and get them on the market. But, fast forward six months and how many spades will still be in or breaking new ground?

There will a gaping hole of projects starting and the fashion business will have one of the largest.

The V shaped, bounce-back recession is ideal because it conserves this economic momentum and it just becomes a blip. Sadly, it’s not looking that way. There is still momentum in the market, but the longer Covid disrupts everything, momentum lessens, and the more time and energy it will take to get it all moving again. This will also make this gap even larger.

Fashion has a time lag. The time between starting and producing samples, to then show, get orders, make and then sell, and then get the revenues, is usually a long timeline. It’s a risk and nobody knows what the state of the market will be when you launch, even at the best of times. Today, many of those thinking about striking out alone and setting up their own thing will choose to put off starting well into next year when they can feel more confident about the economic landscape.

Without trade shows and fashion weeks - a vehicle to showcase to buyers - many stores and websites will reorder previous years’ product, with tweaks, from existing brands. This will only really start to show when SS21 hits the stores after Christmas and consumers will start to notice.

Fashion’s reason to be is newness, or the perception of newness, and a never ending supply of new brands and designers kept the whole industry feeling fresh and new, while established brands and giant luxury groups took most of the sales and profits.

Luxury multi-brand websites and department stores need newness to give vitality to its entire offer. It’s news, it’s buzz, it’s hype and they had it all without the financial risk. This veneer or gap needs to be filled and retailers and luxury groups are now realising that they will have to start supporting it or it won’t be there.

MATCHESFASHION has launched its year-long ‘The Innovators Programme’ designed to champion young design talent. It was built upon an existing womenswear project to include menswear and is a robust package of practical support including mentorship, preferential business terms and £1.8 million in marketing.

The programme was developed as the MATCHESFASHION team collaborated closely with designers during the Covid-19 pandemic. It became clear that many of the designers were unsure how their brands could thrive through 2020 and that practical support and ongoing commitment was required. The 12 designers are: Art School, Ahluwalia, Chopova Lowena, Stefan Cooke, Germanier, Halpern, Harris Reed, Charles Jeffrey LOVERBOY, Thebe Magugu, Ludovic de Saint Sernin, Bianca Saunders and Wales Bonner. Eleven of these designers were already partner brands and each designer was chosen "for having a unique and powerful DNA which is intrinsic".

“I am delighted that we have formalised our support for emerging talent, developing The Innovators into a programme that actually helps futureproof their businesses in what has been a tough year for the creative industry. I have worked with many of these designers for a long time and I am so happy that we are committing to their visionary collections in a practical, material way.” said Natalie Kingham, Buying Director at MATCHESFASHION. This group of designers will only contribute marginally to MATCHESFASHION’s group revenues, £372 million ended 31st January 2019, but they add far more to its brand as a destination for people who love fashion and a place to discover newness and the hottest design talent. This desire is insatiable and companies need this veneer of young designers and brands. A small financial outlay is worth the newness halo effect

LVMH Prize fund

In 2019, Liberty launched its ‘Liberty Discovers’ platform for up-and-coming talent. It supported designers by offering mentorship from the Liberty buying team and exposure opportunities via the brand’s communication platforms and access to Liberty’s two in-house product and fabric design studios, located within its Central London store.

Right - The LVMH Prize fund of €300,000 was split amongst the 8 2020 nominees

As for all the designer prizes, many decided to split the prize monies amongst the nominees due to the pandemic. The LVMH Prize finalists, Ahluwalia, Casablanca, Chopova Lowena, Nicholas Daley, Peter Do, Sindiso Khumalo, Supriya Lele and Tomo Koizumi all shared the €300,000 prize money equally. LVMH also pledged to support previous winners of the prize with a new fund, an undisclosed amount, and the six previous winners of the LVMH Karl Lagerfeld Prize.

In America, the CFDA/Vogue Fashion Fund was renamed ‘A Common Thread’. A Common Thread has raised over $5 million of which over $2.13 million was granted to 44 businesses in the first round of funding, $2.015 million granted to 37 businesses in the second round of funding and $500,000 granted to 47 NYC-based manufacturing businesses in the third round of funding for a total of 128 recipients across the three rounds.

Fashion’s tight production timetable and traditional cashflow model makes it very difficult for small designers and brands to survive. While the giant brands and retailers want to dominate, they also want a veneer of choice and newness. Expect to see many more funds, support and ‘prizes’ to appear from the large luxury groups and retailers.

Buy TheChicGeek's new book FashionWankers - HERE

Louis Vuitton SS21 womenswear Vote

Fashion is pretending everything will be alright. And it will be, eventually.

We’ve just finished the latest round of women’s fashion weeks. What would, usually, have been a month of hundreds of shows stretched between the US and Europe, was a skeleton of former schedules with international fashion councils trying to cobble together something that resembled normality and hoping by the time these clothes hit the stores they’ll be some light at the end of the COVID tunnel. Even before COVID, the traditional idea of fashion weeks and shows was being questioned yet fashion weeks seemed to continue to grow exponentially, becoming a bloated calendar of designer egos. They rarely paid their way.

Left - An underwhelming Louis Vuitton womenswear SS21 collection

What this latest round of SS21 shows did was put a spotlight on the product. Without the fashion circus; the celebs on the front row, hundreds of people pushing and hustling for a ticket, and the subsequent social media onslaught and hype, the clothes and accessorises were the main focus. Replaced by fewer brands, a socially distanced frow, if any, and, a hoped for digital audience tuning in, the product had a chance to shine. It didn’t.

A hard-to-believe audience of 5 million was supposed to have watched the much panned Nicolas Ghesquière collection for Louis Vuitton womenswear telling consumers to ‘Vote”. Seeing inside the soon-to-be-unveiled Samaritaine department store was the highlight.

Other mega brands, such as Chanel and Dior, produced critically underwhelming collections. Some brands tried to think differently though. For example, Moschino hired the Jim Henson studio to make puppets dressed in its collection and a complementary characterful front frow. While the concept was great, the clothes weren’t memorable.

It’s not so much that this season was particularly better or worse than previous seasons, it is more the fact the clothes had less distractions to hide behind. For years, fashion brands have flown everybody - press, buyers - to exotic locations or spent millions on expensive sets and concepts which have all add to the spectacle while helping to disguise the fact that many of the clothes or accessorises weren’t very good. This stripping away of the shows for SS21 has exposed what many have thought for a long time; the majority of product no longer stands up on its own.

This is a broad generalisation and there are still some great ideas in fashion, it’s too big for there not to be, but many brands rely on gimmicks, and, what I call ‘design-by-email’, which tries to squeeze as much as it can from a popular line or style. Brands milk a popular style to death. Rockstuds, anyone?

There has also been this attitude, over the last few years, that ‘brand’ is bigger than any product. As the volume of product grew, so it diluted the ideas, but the ‘brand’ got bigger. It sold, so why question it? Those inside the brands didn’t or don’t seem to be.

But, COVID has made many consumers switch off. It has made many people realise they can live without a lot of this stuff and buying new and expensive stuff was just a perpetual habit they didn’t realise they had.

If nobody can see you wearing or holding it, then what is the point? For many, there isn’t one. Also, without social events, a large proportion of fashion is redundant. Sales follow need and without the need, then want starts to wane and sales dry up. Fashion is going to need fantastic product to re-engage this dormant buying audience. Some of these consumers could be lost forever.

The formulaic fashion cycle of collabs., capsule collections and drops, put a veneer of newness onto tired products and exhausted brands. Brands need to make things that people want to shout about from the roof tops and tell all their friends about.

Moschino SS21 womenswear puppet show

Quality has also become an issue. People are more likely to shout about inferior quality and poor customer service than good. They are quick to social media when complaining or pointing out issues or problems. Many consumers have started to question their last purchases from these ‘luxury’ companies and the inflated price tags for mediocre workmanship. Can they justify the prices? I wrote this last year Gucci: has it sacrificed its quality in pursuit of the quirky? It is going to have to be really good to get people who don’t feel they need something to buy again.

Right - Moschino showed its SS21 collection on puppets

The luxury brands are also humouring the resale market knowing that a strong resell value makes it easier to sell the original item. It’s becoming like the used car market.

Luxury brands need new IT bags and products. Products that stick and become classics and tropes in their repertoire of styles. For example, Dior has been pushing its Saddle bag over the last couple of years, for both men and women. It is a design with a price tag of £2,500 from over 20 years ago. Where is the new Saddle bag for that house?

Brands have become obsessed with newness, but it’s also made the whole business feel more disposable and it needs the brands to stand behind designs and give consumers the confidence to buy. Gucci has done it with its bag collections. Most have become like the fragrance market; continual launches, usurping previous versions with very few lasting more than a few years.

It doesn’t look like things will be much different come next February and March when the next round of AW21 shows are due. Fashion is reactionary but it also needs to go back to the basics of product. While it’s harder to create classic styles, they can do something about quality.

They’ll still be a physicality to showing fashion, whatever happens, and, while brands are concentrating on stemming their losses atm, post-COVID, it has to be about product, product, product. And it needs to be good.

Buy TheChicGeek's new book FashionWankers - HERE

Louis Vuitton SS21 womenswear Vote

Fashion is pretending everything will be alright. And it will be, eventually.

We’ve just finished the latest round of women’s fashion weeks. What would, usually, have been a month of hundreds of shows stretched between the US and Europe, was a skeleton of former schedules with international fashion councils trying to cobble together something that resembled normality and hoping by the time these clothes hit the stores they’ll be some light at the end of the COVID tunnel. Even before COVID, the traditional idea of fashion weeks and shows was being questioned yet fashion weeks seemed to continue to grow exponentially, becoming a bloated calendar of designer egos. They rarely paid their way.

Left - An underwhelming Louis Vuitton womenswear SS21 collection

What this latest round of SS21 shows did was put a spotlight on the product. Without the fashion circus; the celebs on the front row, hundreds of people pushing and hustling for a ticket, and the subsequent social media onslaught and hype, the clothes and accessorises were the main focus. Replaced by fewer brands, a socially distanced frow, if any, and, a hoped for digital audience tuning in, the product had a chance to shine. It didn’t.

A hard-to-believe audience of 5 million was supposed to have watched the much panned Nicolas Ghesquière collection for Louis Vuitton womenswear telling consumers to ‘Vote”. Seeing inside the soon-to-be-unveiled Samaritaine department store was the highlight.

Other mega brands, such as Chanel and Dior, produced critically underwhelming collections. Some brands tried to think differently though. For example, Moschino hired the Jim Henson studio to make puppets dressed in its collection and a complementary characterful front frow. While the concept was great, the clothes weren’t memorable.

It’s not so much that this season was particularly better or worse than previous seasons, it is more the fact the clothes had less distractions to hide behind. For years, fashion brands have flown everybody - press, buyers - to exotic locations or spent millions on expensive sets and concepts which have all add to the spectacle while helping to disguise the fact that many of the clothes or accessorises weren’t very good. This stripping away of the shows for SS21 has exposed what many have thought for a long time; the majority of product no longer stands up on its own.

This is a broad generalisation and there are still some great ideas in fashion, it’s too big for there not to be, but many brands rely on gimmicks, and, what I call ‘design-by-email’, which tries to squeeze as much as it can from a popular line or style. Brands milk a popular style to death. Rockstuds, anyone?

There has also been this attitude, over the last few years, that ‘brand’ is bigger than any product. As the volume of product grew, so it diluted the ideas, but the ‘brand’ got bigger. It sold, so why question it? Those inside the brands didn’t or don’t seem to be.

But, COVID has made many consumers switch off. It has made many people realise they can live without a lot of this stuff and buying new and expensive stuff was just a perpetual habit they didn’t realise they had.

If nobody can see you wearing or holding it, then what is the point? For many, there isn’t one. Also, without social events, a large proportion of fashion is redundant. Sales follow need and without the need, then want starts to wane and sales dry up. Fashion is going to need fantastic product to re-engage this dormant buying audience. Some of these consumers could be lost forever.

The formulaic fashion cycle of collabs., capsule collections and drops, put a veneer of newness onto tired products and exhausted brands. Brands need to make things that people want to shout about from the roof tops and tell all their friends about.

Moschino SS21 womenswear puppet show

Quality has also become an issue. People are more likely to shout about inferior quality and poor customer service than good. They are quick to social media when complaining or pointing out issues or problems. Many consumers have started to question their last purchases from these ‘luxury’ companies and the inflated price tags for mediocre workmanship. Can they justify the prices? I wrote this last year Gucci: has it sacrificed its quality in pursuit of the quirky? It is going to have to be really good to get people who don’t feel they need something to buy again.

Right - Moschino showed its SS21 collection on puppets

The luxury brands are also humouring the resale market knowing that a strong resell value makes it easier to sell the original item. It’s becoming like the used car market.

Luxury brands need new IT bags and products. Products that stick and become classics and tropes in their repertoire of styles. For example, Dior has been pushing its Saddle bag over the last couple of years, for both men and women. It is a design with a price tag of £2,500 from over 20 years ago. Where is the new Saddle bag for that house?

Brands have become obsessed with newness, but it’s also made the whole business feel more disposable and it needs the brands to stand behind designs and give consumers the confidence to buy. Gucci has done it with its bag collections. Most have become like the fragrance market; continual launches, usurping previous versions with very few lasting more than a few years.

It doesn’t look like things will be much different come next February and March when the next round of AW21 shows are due. Fashion is reactionary but it also needs to go back to the basics of product. While it’s harder to create classic styles, they can do something about quality.

They’ll still be a physicality to showing fashion, whatever happens, and, while brands are concentrating on stemming their losses atm, post-COVID, it has to be about product, product, product. And it needs to be good.

Buy TheChicGeek's new book FashionWankers - HERE

working from home windfall COVID 19Money greases the wheels of our consumerist society. Without this continual flow of finance the economy contracts and many people lose their livelihoods, especially in retail.

It is completely natural, and prudent, to want to save in periods of uncertainty. Talk of entering the worst recession for over 300 years would make even the most optimistic of people think twice about a big purchase or being frivolous with their cash.

COVID 19 has been a tale of two working economies; those, generally, white collar workers working from home, whose wages weren’t affected, saving money on travel and lunches, and those reliant on these workers being made redundant or having their hours reduced. Many workers on furlough have been in an economic form of limbo, and while they have not seen most of their income disappear, this is quickly coming to an end and some will be made redundant. Many of these jobs will not be deemed ‘viable’ in the short term.

Left - Results of website loveMONEY poll

A small poll by the website loveMONEY, in June, found readers say their finances have actually improved under lockdown. A remarkable 23% said they were significantly better off, while the biggest amount, 36%, said things had improved slightly.

At the other end of the scale, 13%, more than one in eight, reported that their finances had been hammered since the lockdown came into effect, while a similar percentage (14%) said they were slightly worse off. Finally, 14% of respondents said their bank balance looked largely the same at the end of each month.

The vast majority of people spent less during lockdown because they had less things to spend money on and most not leaving the house.

According to a study by AA Financial Services, 85% of UK adults spent less during lockdown. The average Brit saved (per month) £49 a month on petrol, £57 by not going to pubs or restaurants, £53 by not going to shops, and significant savings in other areas, totalling £617 a month on average for those still receiving their full income.

The report also found that 31% of people with savings accounts had increased their monthly deposits since the start of lockdown. This was confirmed by Bank of England data, which found that personal bank deposits had grown by three times the recent average. The Bank revealed that consumer debt was down by £7.4 billion, to just half the level seen in February. Those who are benefiting from excess income are in many cases using their spare money to pay down debts, while choosing not to take out new loans due to increased uncertainty.

According to Aviva, women seem to have been affected more strongly with 38% of women vs 29% of men saying they have less money to spare at the end of the month than they did pre-lockdown. This could be due to the types of jobs women do, like part time and in customer-facing roles.

Young adults have also been hit hard. Almost a third of 25- to 34-year-olds (32%) are concerned about their ability to save. This age group is also the most worried about losing their job due the impact of COVID-19 (28%).

Aviva Head of Savings and Retirement Alistair McQueen says: “Female savers look to have been disproportionately affected during the lockdown, as workers in sectors like hospitality and retail are more likely to be younger females. Younger people across the board also face a significant challenge. Those under 34 typically struggle to save under normal circumstances, but the current conditions have exacerbated this. For example, this age group typically spends a greater proportion of their budget on housing, and bills, which remains unchanged.”

In August, there was a big government push to get white collar workers back to the office. Then a recent u-turn, telling people to work from home again with positive COVID 19 cases rising. Many commuters don’t want to go back to that lifestyle and it’s easy to understand why.

DJ Sinfield @BigSino on Twitter said, “I am WORKING from home. I am saving £500+ a month and getting an extra 3 hours a day family time. This money and time is being spent at farm shops, local butchers etc and not Southeastern Trains. Why would I want to go back to commuting? Why?”

John Bye @_johnbye said, “The fact is many of us have enjoyed working from home, and companies have realised they're wasting money on big offices they don't really need. I save £300 a month and 2.5 hours a day by not commuting. Why would I want to go back to a London office full time?” and Paul Chapman @Paul_C-Chapman said, “I am saving around £30/day on rail fares and food, I have 3 hours/day of my life back, I have a much better work/life balance and my health is better. Why on earth would I want to go back to daily commuting?”

With interest rates dropping like a stone for savings, for example, the government backed NS&I just reduced its ‘Income Bond’ from a paltry 1.16% to an almost zero 0.01%, the incentive to save has been reduced. What we need is people to spend our way into a U shaped recovery. We need the people, on the positive side of the COVID recession, with this additional monthly money, to spend it.

This is a call to arms for work-from-homers to spend. It’s not about people spend their savings, it is also not about people spending more money than they would usually, it’s about those with this worker windfall - what they would have otherwise have spent on lunch and travel etc.- to inject that into the economy. It’s tempting to save it, but it’s money they wouldn’t have had on a monthly basis.

Put it into retail and services worth supporting, and retailers and brands they don’t want to see disappear and are rewarded with their custom. This isn’t about lazily rewarding shops or travel companies that aren’t very good or really are past their peak, it’s about supporting new or established businesses which resonate with you and make or provide great services or products.

It could be ethical or green products or services. It could be new business, crowd funding and start-ups. Look at it like an investment in the future you want to see. It’s time to put this bonus money to good use. 

Buy TheChicGeek's new book FashionWankers - HERE

UK changes in tax free shopping explained

The words 'Tax Free' is music to any shopper's ears. Many brands and retailers, in tourist hot spots, were looking towards 2021 with optimism. With the UK finally severing ties with the European Union, there was an expected boon for duty free shopping. High spending visitors from the EU would join the rest of the world in being able to claim back VAT from many goods purchased. While they still will be able to, HM Treasury has announced changes to Tax Free Shopping, and they are proving to be deeply unpopular within the retail industry.

So, what’s changing? From January 2021, VAT refunds for overseas visitors in British shops will be removed. Overseas visitors will still be able to buy items VAT-free in store and have them sent direct to their overseas addresses, while the costly system of claiming VAT refunds on items they take home in their luggage will be ended. HM Treasury is also ending tax-free sales in airports of goods such as electronics and clothing for passengers travelling to non-EU countries, following concerns that the tax concession is not always passed on to consumers in the airport. In some instances these tax-free goods are brought back into the country by UK residents, putting high street retailers at a disadvantage.

HM Treasury is clearly expecting duty free shopping to be busier and is therefore no longer willing to incur the expense of running a scheme that ultimately costs them even more money. Tourists with a permanent residence in a non-EU country have been able to claim their VAT back on goods over £30 on production of their receipts. Many department stores and airports installed lounges where shoppers could claim back the value added tax on production of proof of identity and a completed tax form.

Currently, you can get a VAT 407 form from the retailer when buying your purchase They might ask for proof that you’re eligible, for example your passport. You show the goods, the completed form and your receipts to customs at the point when you leave the UK or EU. Customs will approve your form if everything is in order. You then take the approved form to get paid.

Companies, such as Global Blue or ChangeGroup, partner with stores worldwide, and offer a service for tourists to claim back the tax. The refund paid is the VAT minus the company's 'service fee'. Many people have complained about these high fees and hidden costs like service fees, currency conversion fees, payment fees etc.

According to Visit Britain, international tourists spent £6bn on shopping in the UK in 2018. Of those transactions, £3.5bn were registered as tax free sales, although VAT was only reclaimed on £2.5bn. From January 2021, visitors will be able to buy the same goods, but will no longer be able to take them away with them there and then if they want to claim back the VAT. They will have to be sent or couriered by the retailer to their home address, wherever they live in the world. Retailers are worried that this new system will put many tourists off buying. Being able to take your purchase away instantly is one of the joys of shopping. It also means that many will be liable for import duties or taxes in their home countries rather than smuggle it through in their luggage.  Some countries have very high import taxes negating the VAT saving. For example, in China, the ‘Table of Tax Rates on Personal Luggage of Passengers and Personal Postal Parcels Arriving in China” is 50% for watches and timepieces valued over 10,000 yuan (About £1150). Under 10,000 the rate is 30%.

Walpole, an organisation representing 270 of the UK's finest brands, has sent a letter to the UK Chancellor this month and has joined forces with New West End Company along with the British Retail Consortium (BRC) and the Association of International Retail (AIR), to express their deep concern and shock over the decision.

UK changes in tax free shopping explained

It said “it is extremely concerned by the decision’s inevitable impact, not only in London and other key UK shopping destinations for affluent international visitors, but also on the sector’s nationwide manufacturing hubs, where otherwise sustainable skilled employment will be affected by a further contraction in sales.

Right - ChangeGroup at Bicester Village

“The Covid-19 crisis has already dramatically reduced numbers of international visitors to Britain, and other European cities, and the removal of tax-free shopping for anyone visiting the UK will leave Britain at a profound competitive disadvantage post-Brexit.”

Walpole CEO, Helen Brocklebank, said “International visitors are fundamental to the UK luxury sector’s recovery. Right now, the Government needs to be doing all it can to underline the allure of UK PLC and accelerating efforts to encourage affluent visitors to return to our shores rather than actively discouraging them with rulings like this. Globally famous brands like Burberry, Johnstons of Elgin, Harrods, Glenfiddich whisky and Hendrick’s Gin created a ‘jewel in the crown’ sector that was growing at nearly 10% each year before the pandemic, worth £48 billion to the UK economy. £4.5 billion in sales was generated by international visitors alone. Paris ranks as number one destination for luxury shoppers, closely followed by London. We will have no chance of retaining that position or becoming number one unless this decision is reversed.”

The important thing to note is that the government has not removed tax-free shopping, it is just making it harder for people to avoid import duties and avoid tax in their own jurisdiction. 

The UK has already lost vast amounts of tourist spending and anything that looks like it could diminish it further is being met with shock and negativity. The UK will become the only European country not to offer VAT-free shopping for international visitors, but it is hard to argue a case without admitting that many tourists take part in tax avoidance. HM Treasury is expecting a higher number of tax claims when EU tourists join those outside of the EU in being able to claim and doesn’t want to shoulder the increased costs of administering this scheme.

In the new scheme, the VAT will be taken off by the retailer at the till. This new scheme requires added logistics, which adds extra costs for the retailer or seller.

One of the big questions will be, who will pay for carriage to the purchaser’s destination? Plus, installing a trusted form of delivery, in what could be very expensive goods, and making sure they arrive where and when they are supposed to arrive and making the consumer comfortable with that. It will surely have added insurance costs.

As for the change in ending tax-free sales in airports of goods such as electronics and clothing for passengers travelling to non-EU countries, the once bright spot of retail, pre-COVID, the airport, will no longer be as attractive to fashion retailers who can’t promote these duty-free savings. Airports have, over recent years, become shopping centres with runways and this will surely dent sales.

The retail industry could offer to pay the costs of running the tax refund system. It could add a surcharge to each purchase where the VAT is reclaimed. Unfortunately, due to the drop in tourists numbers, it will be harder to compare the effects of this new scheme with the old and whether this is reducing spending overall. When tourists are explained the new scheme, will they decide to buy elsewhere? Pay for the goods and have them shipped to get the VAT back? Or, simply swallow the full retail price?

Buy TheChicGeek's new book FashionWankers - HERE

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