The Sorry State of Fashion Today...

[shoreman1782]

The Economist's take on fashion - er, on removing trade safeguards and the economic results. Doesn't look good for those who value European-made goods... Economist article. I don't think it requires registration.

 

[johnapril]

Fascinating. Thanks for the article. Do you think this means one day my Prada tennis shoes will be collectors items?

 

[Mark Seitelman]

This article covers three significant issues:

1. Couture. China does not affect this area. Haute couture has been on life support for decades. It's the equivalent of womens' bespoke by designers, such as Channel and Valentino, and the prices make Savile Row seem like bargain basement. (E.g., starting prices of $15,000 for a simple suit and $45,000 for a gown.) The couture houses have survived solely on two things: RTW and licensing deals (such as perfume, eyewear, etc.). These subsidize couture houses which number a handful. Couture is for super rich society people. This stuff will always be made in fashion capitals, such as Paris, and China is not a competitor because it doesn't have the customers, designers, traditions, and skills. Furthermore, China couldn't care a wiff about couture because it is a drop in the garment industry bucket.

2. Better RTW. China can give Italy and the other Europeans a run for the money here because these are factory made goods. The talent can be imported to China, and the Chinese can be taught to made a high quality garment, either all hand-made or partially hand-made. Loro Piana opened a textile plant in the USA which I understand makes good cloth (after some rough starts), therefore, I would not be surprised if it and others opened both textile and garment plants in China. The better RTW companies of Europe should be very concerned.

3. Cheap RTW Clothes. This is what 99.9% of the planet wears. China and others (Hong Kong, India, Cambodia, etc.) can turn these out cheaper than anyone else. China is the 800 pound gorilla, and the other cheap labor countries fear that China will get all the work. Many people fear that once the USA lifts its trade restrictions, it can kiss good-bye its textile industry in the south. The USA has already said farewell to its shoe industry.

Cheers.

 

[Brian SD]

This stuff will always be made in fashion capitals, such as Paris, and China is not a competitor because it doesn't have the customers, designers, traditions, and skills. Furthermore, China couldn't care a wiff about couture because it is a drop in the garment industry bucket.

i disagree. in many respects, china could be considered the pioneers of couture. no customers? sure. no designers? maybe. no tradition and skill? where have you been the last 1500 years?

 

[LabelKing]

Quote:

This stuff will always be made in fashion capitals, such as Paris, and China is not a competitor because it doesn't have the customers, designers, traditions, and skills. Â Furthermore, China couldn't care a wiff about couture because it is a drop in the garment industry bucket.
i disagree. in many respects, china could be considered the pioneers of couture. no customers? sure. no designers? maybe. no tradition and skill? where have you been the last 1500 years? Â

Hong Kong has numerous couture customers. China might soon join. And also one has to take note that the Chinese or mostly Asian people refuse to buy a high end good that was not imported from Europe. A cultural anomaly perhaps. The Chinese have had an obsession with European high end goods ever since the Qing Dynasty. For example in Japan Lexus' were never sold since the population did not care for domestic luxury made goods.

 

[stache]

IMO China will need European designers for quite some time as the Chinese esthetic is not up to snuff for the rest of the world. I think Europe will wind up like NYC where some clothes are made here but most are designed in NY and made elsewhere.

 

[LA Guy]

IMO China will need European designers for quite some time as the Chinese esthetic is not up to snuff for the rest of the world. I think Europe will wind up like NYC where some clothes are made here but most are designed in NY and made elsewhere.

Interesting point, but who would have thought, 20 years ago, that anything "Made in Japan" would be a sought after and coveted. These days, Japanese denim is synonymous with good denim (I disagree, but I'm an anomaly), and many of the most sought after designers are Japanese.

 

[Brian SD]

correct me if I'm wrong, but are not lexus sold in japan, just under "toyota" instead of the lexus moniker? i.e. the Lexus IS300 in the USA is the Toyota Altezza in Japan.

I consider the Chinese to be the pioneers of couture in that they invented silk, so to speak, and to the best of my knowledge were the first to utilize it with exuberant gowns of 12 layers or more.

 

[benchan]

Maybe The Economists should stick to topics they are familiar with.

1) Blaming the dying of ultra luxury brand/products on China is totally unfound. They may at well point to the weak global economy.

2) I think Chinese purchase MANY luxury brands mentioned in the article. They experience huge growth in sales in the region despite the presence of counterfeit/copycat products. It pains me to say this, but many Chinese simply "worship" foreign-made products despite they may be inferior to equivalent Chinese one.

3) Lower down in the market chain, yes, indeed, they cannot compete with countries like India and China in production cost. BUT, how about moving up the value chain? The market price of clothing depends largely on design and brand building. The raw materials and production cost is minimal. Just look at Nike and Polo, these two brands in fact BENEFIT FROM the cheap labour in China to allow them to keep the product price competitive and accessible to the mass.

4) Why is the name of ZARA and H&M not mentioned if the article stated "copies rapidly available from clothes chains with quick production cycles" Oh wait, they are also European brands.

Now separately, in response to some comments made by forum members.

Other than Bespoke stuff, China is most prepared to make quality garments and shoes. Yes, sometimes it is just unfair for smaller firms in Europe. In China, they do not just benefit from cheap labour, but the use of latest technologies and best equipment as well. Their easy access to capital obviously helps as quite a few companies are being listed. If you visited a few big factories, you will be stunned. It is nothing like those "sweat shops" that you may envision. On an interesting note, the Financial Secretary of Hong Kong has a family biz that even go as far down the production chain as growing their own cotton and sheep to ensure the quality of raw material.


As for bespoke/hand-made stuff, let just say on the average Chinese (esp female) has lots more hands-on experience in sewing and making clothing by hand or at most an old sewer than people in more wealthy areas. If they got the right training, I am sure that they are up to the tasks.

Lastly, on the comment "China will need European designers for quite some time as the Chinese esthetic is not up to snuff for the rest of the world." This is up to debate. I totally agree that product design in China may not have the worldwide appeal that some European designs have. But 1) please don't forget that many Chinese now have the luxury to study design overseas so they will learn and improve, and 2) brands nowadays want designs that appeal to the huge China market. So in the end, I think there will be an exchange of manpower which will good for the fashion world. That is, Chinese brands that look to break out to the world market will hire European designers while some Europe house may consult a Chinese designer.

Sorry for the long rant.

 

[Mike C.]

I've heard from a fashion designer that there are only about 75 couture buyers in the world. Couture is theater more than anything else. There really isn't a "market" for this stuff.

I don't know why anyone is so concerned about this China thing. A friend of mine's family are the biggest players in the US fashion licensing business. His father pioneered outsourcing and licensing on a large scale back in the 70's. We talked about the China issue this past summer, and he said that the factories are becoming very modern now and capable of producing quality comparable with anywhere else. However, prices there are rising, and new and upcoming areas are being sourced from. So the big bum-rush to produce in China might now be so crazy after all.

 

[Mike C.]

Quote:

However, prices there are rising, and new and upcoming areas are being sourced from. So the big bum-rush to produce in China might now be so crazy after all.
For mass production, I bet China will rise and rise. As wages rise, other labor elsewhere may look cheaper, but China's supercharging economy is overseen by a gov't still capable of economic and industrial planning by fiat. This will work for a while at least. Whole cities are devoted to the manufacture of specific garments; the NYT article was about the sock city, for example, and complexes are being built that group together all elements -- fabric and other clothing elements, plus manufacture and shipping -- The other thing to remember is that a certain fraction of Chinese clothing production is for...Chinese. Sooner or later their worship of foreign brands will shift to Chinese or Euro-Chinese brands perhaps yet unknown. How does this affect couture? I don't know; though I suspect the artisanal manufacturing culture that supports the making of couture will be hard-hit, talentwise, by the drying up of artisanal manufacturing below the couture level, as is detailed in the Economist article and other recent fashion coverage from Milan. My big question is how and where and when the contemporary design culture of China will rise up. They have already proved that you can have economic growth without political freedom, and they have proved that they buy luxury brands in clothing or, for that matter, architecture, that are among the best, or at least the best known, in the world. But what will they design for themselves that will draw the world's attention? This is what I want to see here in NYC. When I think of Chinese fashion, the only thing that comes to mind now is the Shanghai Tang stuff, which was merely China-inspired I think.

How does this affect couture?

It won't. It like saying "buying a Kia is now cheaper then ever" and then suddenly Ferrari sales decline. Not related.

to produce near vertical integration of everything except, perhaps at this point, design. Cheap labor alone is not enough to compete.

Talk about economies of scale. China is ahead in that game. It will take longer for other economies to catch up. However, with globalization, this may be the new business model if possible.

 

[LabelKing]

correct me if I'm wrong, but are not lexus sold in japan, just under "toyota" instead of the lexus moniker? i.e. the Lexus IS300 in the USA is the Toyota Altezza in Japan.

I consider the Chinese to be the pioneers of couture in that they invented silk, so to speak, and to the best of my knowledge were the first to utilize it with exuberant gowns of 12 layers or more.

That may be in that Lexus as a separate sale entity would not generate enough sales as a singular luxury vehicle as say putting a luxury flagship in the Toyota line.

I recall that Lexus only recently took to marketing itself in Japan as compeitition to Benz, etc.

Though it seems to me the Japanese are great fans of English cars.

Same with their cameras. A Japanese made item has less desire as just a workhorse to trudge about. However with their Leica's, and Rolleiflex's it is another plane.

I just sold a Rolleiflex to a Japanese buyer for a fairly high sum. He collects Twin lens cameras exclusively it seems.

 

[chocoball]

I remember reading an Economist article sometime last year that talked about the Chinese-owned textiles factories in Milan. Apparently, much of what we see labelled as upper-mid-end Made in Italy goods are produced by Chinese illegal immigrants in factories owned legitimate Chinese immigrants in Italy operating on the outskirts of Milan. But with the opening up of textiles trade quotas by the WTO, it's a good bet that a lot of these factories will shift their manufacture to China, and return garment "pieces" to Milan for "finishing" and sewing on the Made in Italy tag. I'll try to dig that article up in the Economist archives.

re:China market for high-end "couture" imported goods....one cannot generalise about China. 90% of China is rural and dirt poor, but the average living standards in the major coastal cities (primarily Beijing, Shanghai and their satellite cities - with a population similar to the US) are similar to South Korea in the late-1980/early-1990s already and gaining ground very rapidly. Indeed, Hong Kong's high-end retail sector is largely propped up by the influx of mainland-Chinese tourists. You cannot shop in Testoni, Moreschi, Zegna, Gucci, Ferragamo, Veneta, LV, Bally, Mulberry, etc, etc, without getting elbowed out of the way by rich mainlanders anxious to get the latest gear. They're like the Japanese of a generation ago. Give the new rich in Shanghai another 3-4 years and they'll be joining their Hong Kong friends as regulars at Fashion Week in Paris.

Agree about domestic Chinese designers - there's no one quite up to scratch yet. But look at how long it took the Japanese to produce a Yohji Yamamoto....and the South Koreans, for all their wealth, still don't have any big name designers. In a country of a billion-plus people, with a quarter of those getting richer and richer, and more kids being educated in the best schools in Europe and North America, it's only a matter of time before China comes up with its own Hanae Mori.

 

[Alias]

....and the South Koreans, for all their wealth, still don't have any big name designers.

Seriously. What little I read about with regards to Korean fashion design hasn't been encouraging.

 

[esquire.]

There's no doubt that China will hurt American textile industries, but I think its going to mainly hurt other developing countries such as Banbladesh or Guatamela where companies have already outsourced their production and countries which benefitted from the quotas. Interesting sidenote: Chinese garment workers aren't actually the cheapest source of labor in the world. He will make 4X more than a Bangladesh textile worker, but is almost 6X more productive due to all the investments in technology and equipment.

Usually, what happens when you start outsourcing production to one of these countries, costs start to rise. However, I think China might be the exception with its huge labor market. If prices start to rise in the Guandong Province, you can move to cheaper locations like Hunan. Plus, you've got all these state owned industries which will need to lay off workers, and all these workers looking for work will also dampen any potential rise in costs.