Internet-only retailing and the dominance of social media will rule the future of fashion apparel retailing in the Los Angeles area while 3-D technology will also play a significant role.
These are some of the key findings in the third annual CIT Group Inc. and California Fashion Association “L.A. Area Fashion Industry Profile,” which also included — for the first time — an L.A. apparel survey of 50 industry executives. The report showed that L.A. companies “capture” nearly $18 billion in revenue from the fashion industry there while about $7 billion “flows” to the local workforce.
The researchers of the report also said $43 billion in apparel imports are expected to enter L.A. ports this year. The report showed that there’s been a 9 percent increase to over 4,100 people employed as “fashion designers” in L.A. and the total “L.A. fashion back-end employment, such as manufacturing and wholesaling, adds up to 212,923 jobs.” Of the executives polled, 47 percent cited access to L.A. ports as the reason they do business in the city. This was followed by 37 percent who said it was access to fashion designers and 31 percent cited “fast fashion.”
Asked which countries apparel and textile producers are planning to source goods from in 2016 and 2017, China was tops with 37 percent, followed by Vietnam at 15 percent.
“Los Angeles’ fashion industry continues to play a crucial role in the city’s economy, while adopting a vanguard position in social media, online sales and marketing, and design and manufacturing technology — trends that are changing the fashion industry,” the authors said.
When asked about “innovative technology for the future of the apparel industry,” 54 percent of those polled cited the role of social media as a marketing innovation, which was followed by 24 percent who said it was with “integrated systems between manufacturers and retailers.” Thirteen percent said “either 3-D fitting or 3-D printing.”
The study found that “Internet-only apparel retail is already common in L.A.” and e-commerce-only companies can also “adopt a ‘Clicks-to-Bricks’ strategy, in which retailers build a following through online sales and then open a bricks-and-mortar location.”
“Computer technology also helps L.A.’s designers and manufacturers stay competitive by shortening product cycles and reducing costs…3-D fitting, 3-D printing and virtual reality are all in the mix in L.A.,” the report noted.
Marc Heller, president of CIT Commercial Services, said “Taken together, the savvy use of social media, a state-of-the-art manufacturing platform and a well-developed import and export infrastructure position the Los Angeles region as a leading global fashion epicenter.
“Both established and emerging retail and fashion companies would benefit from working with a financial institution that has deep experience in lending to this sector and that understands the challenges and opportunities it faces.”
The survey also showed that more than half of respondents “said the Internet represents the biggest growth opportunity for L.A. apparel companies in 2016 and 2017.”