A carnage in the French fashion sector
In recent months, many emblematic brands have been making headlines because of their poor financial situation: San Marina, Camaïeu, Gap France, André, Go Sport, Kookaï… The entire mid-range clothing and footwear industry seems to be affected. full force. Indeed, the turnover of the sector to drop by more than 4% after the Covid, according to the French fashion institute.
Did you know ? Corporate insolvencies increased by 51.6% between February 2022 and January 2023 (Source: Banque de France)
Even if this sector is not the only one impacted by these massive closures, the fact remains that these reorganizations, even these judicial liquidations, are alarming for many economists. According to them, buyers and investors find it hard to believe in the renewal and desirability of these brands, which were emblematic in the 1990s and 2000s.
The reasons for these massive administrative closures
After many years of activity, many brands have been forced to close their doors and lay off several thousand employees.
Many cyclical reasons can be at the origin of these massive closures. At first, the demonstrations had an impact on the stores, since the latter had to close their doors on Saturdays during the social protest movements.
Another reason: the Covid-19 crisis, which kept stores closed for many weeks, despite having to pay rent, even during confinement. Even if aid was allocated to brands during the health crisis, it was not enough for some, already bruised by increased competition.
This competition is from second-hand brands or sites, which are more responsive to new consumption patterns by offering second-hand clothes at more than attractive prices. There are also fast and ultra-fast fashion brands such as Zara, Primark and Shein, which constantly renew their collections and their clientele. Their products follow current trends and meet the expectations of buyers, anxious to find products at a lower cost.
Very present on social networks and on the Internet, these brands strongly appeal to young people, who buy mainly online and who are looking for inexpensive clothes, comparing clothes with a simple click instead of going to physical stores.
Did you know : 20% of clothing purchases are made online (Source: IFM)
Because yes, the cost is one of the key criteria of our acts of purchase. Inflation, which has a strong impact on the purchasing power of many French households, has also had consequences for the brands themselves. Indeed, some have not been able to compensate for the rising cost of energy, rents or salaries.
Finally, the signs had to repay the loans guaranteed by the State during the health crisis, a coup de grace for some.
Moreover, this wave of closure is not inevitable for French ready-to-wear. It would even be synonymous with transition within this constantly changing sector. New brands will emerge, others will disappear or completely reinvent themselves with regard to new consumer codes and habits, by relocating factories, producing ecological products or betting on second-hand goods.
LR