report the state of fashion by bof and mckinsey: In 2022 recovery driven by the United States and China, but the alert on the supply chain is growing

report the state of fashion by bof and mckinsey: In 2022 recovery driven by the United States and China, but the alert on the supply chain is growing

Based on the testimonies of over 220 business managers and industry experts, the annual survey The State of Fashion 2022 – made by McKinsey and from BoF (Business of Fashion) – starts with good news, namely that next year should finally be the turning point.

In fact, it is estimated that sales will exceed by 3-8% (a more sustained growth rate than estimated six months ago) the levels recorded in 2019, with China and the United States leading the way while Europe will be more slow, even though 67% of executives surveyed say they expect more favorable trading conditions in this market in 2022 than in 2021.

The fashion sell out in the country of Xi Jinpingafter all, it has already reached pre-Covid levels in all segments starting from luxury, ready to jump even 70-90% on 2019 in the area by the end of the current year. McKinsey points out that there are three Chinese companies in the top 20 super winner by market capitalization.

As for the US, in 2021 consumer sentiment took a positive trajectory, with 43% willing to increase their fashion spending.

All this does not mean that the effects of the pandemic have been devastating. Taking up the McKinsey Global Fashion Index (Mgfi), it emerges that in 2020 the fashion industry recorded a negative economic result for the first time in at least a decade, with 69% of companies losing value. The restart seems to be in the shape of a V, given that the performances of the first half of 2021 indicate a possible return to a positive economic result within the next year.

A pitfall for companies is the pressure on the supply chain, which for 67% of respondents will lead to a surge in retail prices next year, on average + 3%, but at least 10% for 15 managers out of 100.

87% of the sample predict that disruptions in the supply chain will negatively impact margins in 2022: it is almost certain that imbalances between supply and demand will be created, caused by the deadly mix between shortages of raw materials, transport problems and greater shipping cost.

But what will be the trends that will shape the fashion industry in 2022? The research answers this question by identifying 10 trends, starting from the uneven recovery between the various countries, also due to the fact that about four out of five vaccines were distributed, up to last September, to countries with high and medium-high income.

We then move on to the logistical stalemate mentioned above and the persistence of the so-called domestic luxury, given that in all probability we will start traveling again in 2023 and that only half of the air traffic between Asia and Europe two years ago will recover.

This is followed by the reconfiguration of the wardrobe: just comfortable clothing, for 37% of managers the proposals for special occasions will appear in the top three best-seller categories in 2022.

Could not miss the metaverse, with the boom of Nftof gaming and virtual fashion: 81% of Gen Z have devoted themselves to video games in the last six months, with an average of 7.3 hours per week.

Social shopping – which for 73% of the panel will be one of the first three themes to influence their business next year – and circularity are increasingly in vogue: 60% of fashion managers have already invested or plan to invest in closed loop recycling practices.

From this perspective, product passports gain importance, aimed at sharing information with partners and consumers to raise the level of transparency, authentication and sustainability. The challenge is a common commitment of companies, to define the standards to be adopted and carry out large-scale pilot projects.

The ninth point is cyber resilience. The nightmare of fashion managers (or at least 53% of them) is that the company will suffer a significant hacker attack in 2022: it is urgent to raise digital security.

Finally, the lack, or rather the management, of talents: in order to attract and maintain their human resources, companies must redesign their workplaces by focusing on sustainability, heterogeneity of solutions and digitization.


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