With all of the media chatter about designer brands moving away from wholesale, it begs the question, just how can they do this in the short term? The answer is simply that they can’t! Wholesale for designer fashion, while very challenging, is its very life-blood.
Direct to consumer is going to be very important, no question. However, smaller designer brands and even more established brands, who currently only wholesale their collections, could of course transition to a “direct to consumer” model but it’s fraught with risks (unknowns) and couldn’t happen in less than a few seasons, for practical reasons.
We should also not forget that the route to our consumer is currently via an independent or department store, all of whom buy via wholesale, and who can see that changing anytime soon? E-commerce is not a magic bullet by any stretch of the imagination but, like many things about the fashion industry, lots of people don’t really understand exactly how it works, even some of those in the industry.
I myself have worked with a number of designer brands looking to develop online platforms, only to have to scrap their plans further down the road because of untold challenges. Surprisingly, perhaps, but one of the biggest issues for designer brands trying to move to direct to consumer is actually knowing what products to design, produce and sell, as without the guidance and direct feedback from wholesale or buyer knowledge, they have no frame of reference to pick good sellers.
Fashion buyers have years of experience and fully understand their customers’ buying habits and tastes, so the selection process in turn usually dictates what designers will put into production from their collections. So it begs the question how will designers have access to this knowledge if they move away from wholesale?
Even if the fashion business is changing (and some would argue “when is it not?”), part of the ongoing problem is that the fashion industry came to the “digital party” very late in the day and it’s in a complete tail-spin as to what to do next – ’cause nobody really knows! Throw into that mix the growing power and influence of social-media platforms (Insta-mania) and brands are scrambling to address how to give the customer what they think they want.
Additionally, the cost in time, money and manpower to drive sufficient traffic to a website or any digital channel in order to generate sizeable sales is prohibitively expensive for many designer brands. Add to this back end operations for administration and despatch, which require manpower and physical space for stock, and it starts to become apparent that moving away from wholesale is akin to running an entirely different business, that will require different skills, resource and more importantly serious financial investment.
The answer is perhaps to strike a balance between, wholesale, digital and direct to consumer (which can also include retail pop-up and events), but that’s breaking new ground for many fashion businesses and I would suggest it is not to be entered into lightly.