The war will weigh on fast fashion - MilanoFinanza.it

The war will weigh on fast fashion – MilanoFinanza.it

The Russian-Ukrainian conflict also weighs on fast fashion. It is not only the big luxury brands that are suffering the first repercussions of the invasion of Ukraine, which is gradually destroying all fashion titles. Inditexthe Galician group to which the brands belong Zara e Bershka, has plummeted by more than 15% in the last month alone. The decline (-2%) continued yesterday, although the company shared excellent results for the 2021 financial year, with net profits almost tripled and revenues up by 35.8% to 27.7 billion euros. However, given the current geopolitical context, the company was required to specify that “in the period from 1 February to 13 March 2022, revenues in Russia and Ukraine represented approximately 5% of the growth in turnover”.

If the conflict continues, therefore, all the companies that have decided to block activities in the countries involved could have more or less slight consequences on the business. For starters, the Swedish giant H&M it has suspended all sales in Russia, while shops in Ukraine have already been temporarily closed for the safety of employees and customers. Russia, it must be said, is the sixth most important market for the fast fashion brand, which is why the stock has plummeted by more than 20% in the last 30 days due to concerns expressed by various analysts. Even Mango said it would temporarily close its stores and its online site in Russia. The company has 800 employees and 120 stores in the country, 65 of which are managed in franchises. Again, if the closure is protracted for a long time, significant drops in revenue could begin.

The same path was also taken by the giants of sportswear. Starting with Nikewhose prices in the last month have seen a drop of 14.8%, which has suspended the sale of the products both on the website and through the applications. Adidas (-9%) instead suspended relations with Russian Football Federationwhile Puma (-15.4%) said that deliveries to the former USSR have been stopped but its 100 Russian stores are still open. Among the British companies, the decision of Marks & Spencer, which blocked shipments to its Russian business. The retailer has in fact announced that it has stopped sending its products to stores, managed by Turkish franchise partners, “given the ongoing humanitarian crisis after the invasion of Ukraine”. The stock has recorded a -12.4% in the last month, with a good recovery in the past few days. (All rights reserved)

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