Price Increases on Fashion’s Horizon

If the economic recovery stays on track, the fashion world just might have to adjust to something it hasn’t seen in almost two decades: inflation. The upward swing in prices would mark a stark turnaround from the steady slide in costs that has been the industry norm as retailers and suppliers found ever-less-expensive sources of supply. But with wage pressures rising in China, raw materials prices climbing and demand beginning to recover worldwide from both consumers and manufacturers, there is a growing sense deflationary pressures could be easing and its opposite might begin to take hold. Retail executives, at least, see that as a hopeful sign. And after more than a year of cost cuts and consumer retrenchment, apparel retailers and vendors are trying to put the Great Recession behind them — and market share gains have become the beacon they hope will lead them forward. From Saks Inc. and Neiman Marcus Inc. to Macy’s Inc., Wal-Mart Stores Inc. and Amazon.com, everyone wants more. Fashion brands and retailers are always jockeying for consumer dollars, but 9.7 percent unemployment, higher savings rates, a tenuous recovery and lower overall sales have only upped the stakes.
 

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